Indices/Commodities Outlook

 

INDICES/COMMODITIES
S&P Futures 2101 The S+P had another choppy session (2091/2113) although it has finished with no great damage done, at 2100. Initially weighed by some disappointing corporate results, things perked up a little on the release of the best jobless claims data since 1973. The previously mentioned 2090 support (38.2% of 2034/2125) looks as though it could come in for another test which, being the case, could see a run towards 2080 (50%) and possibly to 2068 (61.8%). The topside looks less likely in the short term, but if wrong, look for a run back towards 2110 and eventually for a test of the recent top at 2125 and the 2133 all time high. As we said previously, the indices have been choppy and extremely difficult recently and there are easier things to trade at present. Sidelined, but with a mild preference to the short side.
DJI 17693 Ditto S+P. The DJI is about 0.7% lower today after a choppy 17625/17830 range, and now sits below the 200 DMA at 17715 suggesting lower levels to come, and which will provide the initial resistance. The dailies still suggest that we may be in for lower levels ahead, (indeed they look more negative than the S+P indicators) potentially for a re-test of 17625, below which would open the way to 17500.  Back above the 17715 area would potentially revisit the 17830 session high, a break of which would see sellers at 17900 and again at 18000, although in the short term it does not appear that this is likely to be seen. As before, sidelined. Possibly selling rallies remains the plan although not overly convinced.
ASX SPI 5513 The SPI continues to leak to the downside, today heading to 5498, before a mild bounce to close at 5513. Given the weak price action in the various commodities, further losses would seem possible and a sustained break of 5500 would open the way  to 5455 (61.8% of 5323/5668) and then to 5403 (76.4%). The short term charts are showing some mild bullish divergence and a bounce could take the SPI back to the previous support – now resistance – at 5535, beyond which (unlikely today) would head to the 200 HMA at 5570 and possibly to the 200 DMA at 5580, which if seen, would appear to be a good medium term sell opportunity, with a SL placed above 5600.
GOLD 1090 Gold has been choppy and slightly lower today, at 1090 (range 1105/1087), but overall remains in sideways mode while it recovers its balance following Monday’s sharp fall. This choppy action seems likely to continue in the near term, but further out things do not look healthy, with further losses, (probably not helped by a strengthening dollar/ hawkish Fed), would see Gold head back to 1070, beyond which there is not too much to hold it up ahead of 1045 (Feb 2010 low), and 965 (Oct 2009 low), with an eventual target being at 888 (61.8% of 254/1921). Back above 1105/10, the topside will run into strong selling interest on the approach back towards 1130, with 1115/20 likely to be toppish on an intraday basis. Selling rallies at 1100/05 seems to be the plan with a tight SL placed above 1110.
SILVER 14.63 Silver had another choppy day, finishing near the session lows after a 14.59/99 range.  A sustained break of 14.60 would open the way to the 1 Dec ’14 low at 14.41, below which would then head towards the 200 MMA (14.15) and eventually to major rising trend support at 13.00. The longer term target would seem to be somewhere around 8.40 (Oct 2008 low) albeit a long way off at this stage. Back above 15.00, the topside will find sellers at 15.25, 15.40 and again at 15.75/85 ahead of 16.00. Selling into strength is again favoured, on the back of a view of a strengthening dollar, but with a tight SL placed above 16.00.
OIL(WTI) 48.82 WTI took another beating today, in falling to 48.18, before a bounce that allowed it to finish the day at 48.80. Below the session low, will find bids close by at the next support, at 48.09 (2 April low), a break of which would accelerate towards 46.80 (76.4% of 42.02/62.55). The topside, which looks rather more problematic, will now find sellers at 49.85/50.00, which would seem a decent sell area, but a break of which would take WTI back towards the 100/200 HMAs at 50.20/51.00, although this seems rather over the horizon at present.

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