NEW YORK (TheStreet) -- Gold's intraday correction is in place. Watch for a break in the short term.
In our 2nd Skies members' commentary last Thursday, we talked about how the key resistance short term for gold is in the 1324 area. If the precious metal rejects from here, expect a round trip back down toward 1306.
As we can see, the precious metal fell lower from a high of 1323 last week. It is now heading back to 1306.
For now, intraday we have to watch the 1303 and 1313 levels for the next major direction. While long term we are still in a down trend, medium term we are in a range with some bullish under-pinning. If 1324 folds, then the 1331 and 1341 levels will be tested.
AUDUSD: Large Range in Play, Heading Toward Range Support
Since April this year, the Aussie has been largely contained within a +230 pip range between 9200 and 9435. The pair attempted to head north outside of the range, but had three false-break setups, all leading to lower prices.
You'll notice the general tendency after the false breaks is not to consolidate. Such breaks are followed by strong selling, further cementing the two-way market, but also the presence of sellers willing to cap the upside.
For now, the pair seems as if it wants to head for the 9200 key range support before buyers step in and sellers cover their shorts. Bulls can look to play the range buying at the support, while sellers will want a daily close below this, or a weak rally to the top of the range before selling again.
Dow Jones: Engulfing Bar Followed Up by Strong Buying
As we opined in our daily commentary to end last week, we felt the price action of the major U.S. indices hinting at bottoming and should bounce from here, likely closing green on Friday. We even tweeted about this before the U.S. open on Friday.
As we can see, the Dow Jones did just that, forming a large bullish engulfing bar on Friday. Today the Dow has literally opened and climbed from the get-go, up +75 points on the day. The next major resistance comes in at 16722.
If the bounce forms a V-bottom with several bull closes taking out 16722, expect a retest of 17000 and perhaps the yearly highs as bears will likely capitulate after 16722 and wait for the yearly highs before re-entering.
At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.