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Gold's Surge to New Relative Highs Retraced Entirely


Today the precious metal fell in line with currencies like the euro.

The following are the latest daily summaries of my ongoing intraday coverage, providing context to interpret price action. Any prices listed are for a contract's current "front month." Their direction tends to correlate with any ETFs listed for each.

Today's Highlight: What the cliff giveth to gold, FOMC minutes hath taketh away. Gold's surge to new relative highs was retraced entirely Thursday. The precious metal fell in line with currencies like the euro. Each is testing relevant support, so any delay in reversing up would suggest another downleg coming.

Dollar Basket
Thursday's gap up to the rally's 80.20 target later extended sharply higher to test 80.50, targeting 80.55-80.75.

Mar Contract EC; (NYSEARCA:FXE)
Wednesday's close under 1.3195 gapped down Thursday, and then later extended through its 1.3080 target. The drop can extend to 1.3035 or 1.2965 so long as 1.3145 is not recovered.

Feb Contract GC; (NYSEARCA:GLD)
Not extending up immediately Thursday made a correction likelier down to 1675.00. Thursday's open gapped down to test it. The FOMC minutes triggered another downleg back to "lower prior highs" at 1662.00. Just closing above 1663.00 keeps alive potential for retesting 1675.00, or even probing above it to 1690.00. But resuming the rally is premature, as is rejecting the prior rally leg.

Mar Contract SI; (NYSEARCA:SLV)
Thursday's reaction to FOMC minutes extended the morning's drop under 31.00, but only to 30.40, still above "lower prior highs." A recovery remains credible so long as 30.25 holds as support.

30-year Treasury
Mar Contract US; (NYSEARCA:TLT)
Extending down Thursday confirms Wednesday's steep drop. It also creates potential for a corrective bounce up to 145-08 while lower lows at 143-30 are in play. Closing above 146-00 would suggest a bigger bounce underway.

Crude Oil
Feb Contract CL; (NYSEARCA:USO)
The reaction down from Wednesday's high did not extend lower Thursday as the market ranged narrowly sideways. A corrective dip to the gap below at 91.80 could be tested down to 91.25 would suggesting the rally had ended.

Natural Gas
Wednesday's gap down to new lows was not rejected Thursday. Fresh lows were probed without extending down, but there is no active signal.

Editor's note: Rod's analytical techniques are designed to efficiently identify targets and turning points for any liquid stock or market in any time frame. He applies his techniques live intraday, primarily to S&P futures, at RodDavid .com.
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