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Gold Surges Into the New Year... and Out of It, Too?


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: Mark-to-market influences for tax purposes can influence the last session's price action. But gold's rally Monday seems very much inline with expectations.

Dollar Basket
Monday's choppy sideways ranging kept alive potential to test 80.20, which would put into play higher targets.

Mar Contract EC; (NYSEARCA:FXE)
After Sunday night's temporary strength, Monday's session ranged almost exclusively in negative territory. Friday's 1.3325 close was still being tested, and not broken. Back under 1.3195 should trigger a delayed decline targeting 1.3080, but there is otherwise potential for fresh highs to test 1.3325.

Feb Contract GC; (NYSEARCA:GLD)
Having earned one extra day to make its case, the recovery began Monday by gapping up above 1660.00, and then extended higher to 1681.00. Just recovering 1675.00 was the minimum requirement, so a second consecutive higher close Wednesday would confirm a major recovery underway.

Mar Contract SI; (NYSEARCA:SLV)
Monday afternoon's surge above last week's 3.20 prior highs did not touch last week's 3.51 prior high. If the hesitation is bullish -- - which it is, potentially, from a contrarian perspective - -- then the recovery should not hesitate extending higher Wednesday.

30-year Treasury
Mar Contract US; (NYSEARCA:TLT)
Monday's blip-up peaked just under Friday's 148-25 pre-open high before reversing down sharply to 147-03. There is no bullish reason for this retracement, and closing under 147-00 would signal signal momentum reversing down.

Crude Oil
Feb Contract CL; (NYSEARCA:USO)
Friday morning's retest of 91.30-91.40 prior highs suggested that a distributive top was not forming. Monday's fresh highs attacked 92.00. A second consecutive higher close Wednesday would confirm.

Natural Gas
Friday's recovery had stopped pessimistically short of extending to fresh highs. That didn't prevent gapping down Monday instead of extending higher. But there was no breakout to confirm, so buyers aren't undermined. And gapping down Monday did not gain traction; - in fact, it filled the gap back down to Thursday's close. Above 3.45 would qualify as a breakout.

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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No positions in stocks mentioned.
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