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The 30-Year Treasury Makes It Through the Auction, but Support Is Thin


Another drop into the weekend would confirm that a retest of its lows is underway.

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 long bond ranged narrowly through its monthly auction. Meanwhile, a sell signal is in play, so any strength while those two factors are pressuring it would be unlikely to extend.

Dollar Basket
Thursday's surge to test 80.20 resistance would leave no unfinished business below if it were extended Friday to close above 80.35. Otherwise, the recent 79.75 low's retest is likely without extending higher Friday.

Dec Contract EC; (NYSEARCA:FXE)
Testing 1.3775 support Thursday threatened to reverse the trend down. That will be likely on a second consecutive lower close Friday in this pattern. There is otherwise potential for an oversold bounce to retest recent highs, and to actually test 1.8333 resistance.

Feb Contract GC; (NYSEARCA:GLD)
Wednesday's failure to confirm Tuesday's surge was punished harshly overnight with a drop that gapped down Thursday to test 1232.00. That is a 61.8% retracement of the rally from last week's low. Room for noise around it down to 1224.00 was tested, too. Closing under 1219.00 would signal that a new down leg was underway. Otherwise, closing back above 1240.00-1245.50 would trigger another rally leg.

Mar Contract SI; (NYSEARCA:SLV)
Thursday's gap down back under prior highs formed an Island out of the two prior sessions. Gaps were made to be retested, albeit not necessarily immediately. But so long as a lower close Friday doesn't confirm Thursday's drop, then a recovery would be likely.

30-Year Treasury
Dec Contract US; (NYSEARCA:TLT)
Gapping down slightly and ranging sideways through the day and through the afternoon's auction did not extend the 129-16 signal targeting a retest of last week's lows.

Crude Oil
Jan Contract CL; (NYSEARCA:USO)
Ranging narrowly sideways doesn't suggest a new up leg is forming, so much as a correction to the current up leg remains possible.

Natural Gas
Fresh highs overnight were probed intraday Thursday to 4.42. Dipping to unchanged at 4.31 was recovered to attack the morning's highs, and to maintain the rally's momentum.

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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