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Is Crude Oil Ready to Rally?


Almost any immediate strength Tuesday would be credible for triggering a rally higher.

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's false break indication cannot be a false break itself. So, Monday's complete recovery of Friday's tumble isn't necessarily bullish. And it underscores last week's elastic session that first predicted trending about to begin. But it does create a new timing window described below… Meanwhile, has crude oil finally bottomed?

Dollar Basket
The drop from 84.45 extended Monday to test "lower prior highs" at 82.40. Back above 83.15 would signal the pullback had ended, with new highs in-play.

Jun Contract EC; (NYSEARCA:FXE)
1.2955 helds as support Friday to maintain momentum for the 1.3110 target, which was tested at Monday's high. A pullback has room down to 1.3020 before suggesting that momentum is reversing down, although pullbacks should hold 1.3015 if the rally intends to extend.

Apr Contract GC; (NYSEARCA:GLD)
Friday's post-close extension down to 1385.00 was recovered Sunday night to test the 1398.50 bounce limit by $3. A dip back to 1390.00 Monday morning was recovered more substantially to 1416.50, well above the 1398.50 bounce limit. The drop must resume without further delay - and aggressively - to avoid a much bigger rally leg.

May Contract SI; (NYSEARCA:SLV)
Monday's gap up was retraced to almost fill the gap below back to Friday's 22.22 close before recovering to fresh highs at 22.90, which more fully filled the gap above back to Thursday's 22.70 close. The attraction above was neutralized thanks to impatient buyers at the attraction below. Back under 22.35 would again be credible for trending down.

30-Year Treasury
Jun Contract US; (NYSEARCA:TLT)
Another flight-to-safety Monday morning triggered a retest of Friday's pre-open rally to 142-13. Its reaction down still held 142-00 as support, so a bottom may be forming, so long as 141-06 isn't broken.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
Friday's "inside day" was followed by another Monday, sort of. It was also contained within Thursday's range, but probed above Friday's high. Any higher Tuesday would still be credible for triggering a rally back up to 96.00, and probably then on to 98.10.

Natural Gas
The 4.11 buy signal wasn't even attacked Monday, as 4.00 was probed as support.

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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