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Gold and Crude Oil Plunge


Today's overly bearish plunge compensated for yesterday's shallow dip.

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 and crude oil plunged Tuesday, retracing all of their recent "worry" premiums. Very relevant support is being tested in each instance, with no room and little time to avoid extending the drops.

Dollar Basket
Tuesday's gap up did not extend higher and the balance of the session ranged narrowly back down to Monday's close, making it difficult to consider the recent dip as having ended.

Sep Contract EC; (NYSEARCA:FXE)
Gapping up Tuesday without extending higher was not bullish, but sellers did not retake control as the balance of the session only ranged narrowly sideways. Early trending Wednesday would be likely to extend.

Dec Contract GC; (NYSEARCA:GLD)
While waiting for Friday morning's surge to extend, it was retraced entirely. Monday's narrow ranging above 1384.50 gave way overnight to a plunge back down to 1357.60. Once again, closing under 1377.00 requires opening above 1381.00 to reinstate upward momentum. So long as 1377.00-1381.00 isn't required, the drop can extend down to "lower prior highs" at 1341.00.

Dec Contract SI; (NYSEARCA:SLV)
Gapping down Tuesday probed under the 23.10 origin of Friday's surge down to 22.85. The pattern has no room and little time to delay recovering back up to 23.55 if a deeper downleg targeting 22.00 can be avoided.

30-year Treasury
Dec Contract US; (NYSEARCA:TLT)
Tuesday's gap down to 128-20 essentially retraced all of Friday's spike up on the Employment Situation report. Its natural support produced a bounce up to 129-14, which must hold as resistance to maintain potential for fresh lows down to 127-04.

Crude Oil
Oct Contract CL; (NYSEARCA:USO)
Monday's shallow dip from 110.65 seemed skeptical about avoiding Syrian confrontation. Tuesday's plunge to 106.40 seems overly assured. Closing back above 107.50 would trigger a retest of recent highs, but there is otherwise no active signal.

Natural Gas
Monday's bounce had rejected Friday's extended drop. The bounce also allowed room for Tuesday's dip without it renewing the drop. Closing back above 3.61 is still needed to launch 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.
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