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Will Gold Rally on Monday?


The yellow metal's decline should extend down forcibly Monday without delay if it intends to extend down at all.

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: Gold seems to have reached an inflection point, both in price and in time. Optimistically avoiding a touch of prior lows Friday, despite gapping down and ranging almost exclusively in negative territory, should either compensate for the delay Monday by capitulating downward, or else rally sharply to prove Friday's buyers right for having absorbed the day's sellers (the past week's sellers, too, for that matter).

Dollar Basket
Thursday night's dip bounced off of its 80.05 pullback limit to retest Thursday's 80.35 highs, leaving 81.05 in-play so long as the pullback limit continues to hold.

Mar Contract EC; (NYSEARCA:FXE)
Friday's opening weakness extended down slightly into the weekend. The second consecutive lower close that all but requires there to be a third lower close - not necessarily consecutive, although currencies do tend to duplicate Friday's behavior on Mondays. The next lower support at 1.3275 is in-play so long as bounces hold 1.3465-1.3475.

Apr Contract GC; (NYSEARCA:GLD)
Thursday afternoon's slide back to its morning's lows extended into Friday's opening gap down. Despite the extended momentum, optimism prevented even touching Thursday's lows. Intraday bounces peaked repeatedly upon testing 1669.00-1670.00 resistance, closing back at the 1666.00 session lows. The decline should extend down forcibly Monday without delay if it intends to extend down at all. The entire bearish scenario depends largely upon holding 1675.00 as resistance.

Mar Contract SI; (NYSEARCA:SLV)
Friday's narrowing range that optimistically avoided even touching Thursday's 31.30 low suggests that any lower low Monday will slide aggressively back to 30.90 and lower.

30-year Treasury
Mar Contract US; (NYSEARCA:TLT)
Thursday's probes above 143-18 weren't credible, which Friday's opening slide to 143-00 confirmed. The test of 143-04 held, and narrow ranging around 143-18 through the afternoon avoided either extending higher or reacting down. Not resuming the drop almost immediately Monday would have potential for extending the corrective bounce temporarily to 145-03.

Crude Oil
Mar Contract CL; (NYSEARCA:USO)
Friday's opening surge peaked under 97.00 and reversed back under Thursday's 95.55 low. The price action had no predictive value, other than to further solidify the current range's attraction, which will undermine or abbreviate the next attempt to trend away from it.

Natural Gas
Friday's weakness wasn't substantial, and barely avoided touching the critical 3.25 support, but its timing all but requires the rally attempt to resume Monday without further delay to avoid becoming a downleg targeting new lows.

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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