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Many Commodity Markets Are Paralyzed Ahead of FOMC News


Volatility was largely missing almost everywhere.

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: Was it a sense of calm or anxiousness that permeated the air Tuesday ahead of Wednesday's FOMC statement? Either way, volatility was limited to energy-related commodities.

Dollar Basket
Tuesday's narrow sideways range didn't reject Monday's gap, nor did it confirm it. There is no active signal going into Wednesday's FOMC statement.

Sep Contract EC; (NYSEARCA:FXE)
Ranging sideways Tuesday still pierced Monday's low to actually test the 1.3333 level, which is still trying to resist a much larger rally from beginning.

Dec Contract GC; (NYSEARCA:GLD)
Failing another test of 1321.00 resistance this time pushed back down to the recent ~1305.00 low, all but assuring at least a fresh low. A fresh low's rejection would make triggering the buy signal more reliable. Triggering the buy signal without first probing a fresh low would be suspicious.

Dec Contract SI; (NYSEARCA:SLV)
Monday's bounce was rejected by Tuesday's gap down, which extended back to recent lows, leaving no active signal ahead of Wednesday's FOMC statement.

30-year Treasury
Dec Contract US; (NYSEARCA:TLT)
Despite retracing all of Monday morning's gap up back into negative territory, Tuesday's session only ranged sideways in positive territory between 129-28/130-12. There is no trending underway ahead of Wednesday's FOMC statement, with equal potential for resuming the decline to 127-04 or for launching a rally above 131-00.

Crude Oil
Oct Contract CL; (NYSEARCA:USO)
The 106.75 pullback limit broke lower Tuesday to test 105.00. Any near-term recovery potential requires rejecting the extra dip by closing sharply higher Wednesday, if not already gapping up at Wednesday's open.

Natural Gas
Tuesday's open gapped up for a change, instead of gapping down like the prior three consecutive sessions. The pattern was similar otherwise, reversing the gap back into the prior session's range. But that meant a post-open dip back into negative territory. At least the open's gap up was above all prior highs, creating an attraction that will try to attract price back up to it, presumably to resume and extend the rally.

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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