FX Charts weekly Outlook: Commodities/Indices by FX Charts

 

INDICES/COMMODITIES
S&P Futures 2013 The S+P had a positive end to the US session on Friday after an early dip to a new trend low of 1970, in attempting to test the 16 Dec low at 1967. Despite the positive finish to the week, equities appear to remain under some pressure from the fall in the oil price and the fallout from last week’s move by the SNB and I suspect that rallies are still a sell-into-strength scenario. If risk aversion returns in force, then the downside will again be the direction to watch.            Technically, the daily and weekly charts still point lower, so an eventual re-test of 1970/60 should not be ruled out, although today is a public holiday (MLK birthday) so the markets will be closed.  2006 (100 HMA) will now provide the initial support although a break could see a return to 1985 and then possibly towards the 1960/70 area, below which 1950 (50% pivot of 1812/2088) and then 1918 (61.8% of 1812/2088) would eventually attract. The topside is sitting up against the 200 HMA at 2016, a break of which could see a return to descending trend/ minor Fibo resistance at around 2040. The game plan of selling into strength, with a tight SL placed above 2040 seems to be the way to go. Above 2045 could see a test of 2060(76.4%  of 1812/2088), although at this stage I am not sure that we are heading this high
DJI 17431 The Dow headed down to 17123 before a strong bounce to 17456, finishing the week near the top end of the range. As with the S+P, the short term charts are positive so we could yet see a stronger recovery towards 17500 (200 HMA), and possibly beyond, to 17,600. Should that be the case, I would be tempted to sell into the strength, looking for a return towards the 100 DMA at 17265 and eventually to Friday’s lows, and beyond, towards the 200 DMA at 19675.
ASX SPI 5307 Having fallen to 5213 on Friday, the ASX later turned strongly higher, in line with global indices, to finish back at 5307 and it looks as though we are going to be in for some more choppy trade in the sessions to come, possibly using 5300 as a pivot. While the short term charts point higher we may be in for a run towards 5330 and possibly 5325 (200 HMA) and possibly 5350, but which if seen, should be rather toppish I suspect. The 100 DMA is at 5380 and would provide sterner resistance, if seen, and stops on shorts should be placed above here. The downside will find support at 5255 (100 WMA) and then at Friday’s 5213 low. If the US equities do head lower, as we eventually expect – and they take the SPI with it, then eventually I suspect we are in for a test of 5200 and lower, although this currently appears to be some way off.
GOLD 1280 Gold continued to benefit from safe haven demand following the move from the SNB and also from the ongoing concern over the oil price, in holding the 1255 support (200 DMA) and heading higher to reach 1282 on Friday. With the dailies looking positive, we could now head on to 1294 (76.4% of 1345/1131) and then to 1300. A break of this would trigger stops and push higher towards the 8 August high at 1322. The US$ is currently rather mixed against the other majors, but if the general uptrend does resume, then Gold could well run out of steam, so downside stops on long positions need to be kept tight. Back below 1255 now would signal warnings and could see a run towards 1235 and possibly 1215. This looks unlikely for the time being and I would still rather trade from the long side. The 4 hour charts are overbought though, so leave room for a dip towards 1260, with a tight stop placed under 1250.
SILVER 17.77 Silver finally caught up with Gold and made it to the 17.80 target (high 17.83) before backing off a little into the week’s close. As with Gold further gains look possible and another run towards 18.00 would not surprise, with the major target then being seen at the 200 DMA at 18.45. Buying dips remains the theme, with 17.25 (minor) and then the rising trend line, currently at 17.00 providing the support levels. As with Gold, be alert to the chance of general dollar strength, which would put headwinds in the way of further upside progress.
OIL(WTI) 48.87 WTI had a choppy but generally positive session, heading higher late in the day on Friday after holding on above the 100/200 HMA support (47.45/46.60). The choppy trade looks set to continue, with a mildly positive bias while the dailies unwind their oversold condition, but overall there is no real change in the outlook. As before, an ongoing, wide range of 45.00/50.00 would not surprise, and in the middle I would tend to leave it alone, although buying dips currently remains the mild bias. A break of 50.00 could see another run towards last week’s 51.25 high, although as we said previously, anywhere in the 51/52 area would appear to be a sell in preparation for another look at the downside.

 

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