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As Weekend Begins, Euro Is Forced Back to Reality


Take a look at the intraday action in commodities.

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: The impending weekend forced the euro back to reality as was expected, rejecting the mid-week bounce that never gained traction. But its drop back into the range was not trending, and it could rally again, especially as gold and bonds remain in a range.

Dollar Basket
Thursday's second consecutive recovery from probing intraday under support required Friday to reward those buyers by rallying to fresh highs. Friday's surge up to 81.50 was consolidated above prior highs, suggesting that it will extend higher Monday.

Dec Contract EC; (NYSEARCA:FXE)
Thursday's failed higher high that was retraced back into Wednesday's range signaled the false bounce had ended, which all but required Friday to resume the decline. The drop under 12700 retested Tuesday's opening gap and closed back above its 1.2750 high. That requires the decline to extend down immediately Monday or else form a durable bottom.

Dec Contract GC; (NYSEARCA:GLD)
Still testing 1714.50 at Thursday's close prevented clearly signaling that a downleg was underway. Friday also ranged narrowly around it. Extending down without delay would be credible.

Dec Contract SI; (NYSEARCA:SLV)
Holding a dip to 32.25 Thursday did not prevent a lower low Friday, but 32.25 did hold again as support. There is still no active signal.

30-year Treasury
Dec Contract US; (NYSEARCA:TLT)
A fresh high up to 152-21 was retraced back down under the two prior highs at 152-10, which were were still being tested at the close. Rejecting the breakout attempt would still require breaking lower Monday.

Crude Oil
Dec Contract CL; (NYSEARCA:USO)
Despite retracing all of Wednesday's Gaza-related surge, Thursday's drop retraced only the surge and stopped short of breaking lower to resume the decline. That kept the door open for another bounce Friday, which gapped up to retest the prior surge's highs, which held as resistance. Any higher could extend up to 89.00, but there remains potential otherwise to resume the decline.

Natural Gas
Thursday's wide ranging back down to 3.70 made trending unlikely, and unlikely to gain traction if attempted. Friday did rally back up to relevant resistance 3.80, and any higher close would trigger a new upleg.

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.
No positions in stocks mentioned.
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