Originally published by CMC Markets
A number of resource related markets have started to attract renewed interest. WTI crude oil has broken out of a downtrend while the Australian dollar and New Zealand dollar have popped back upward in a big way. The pound is also breaking out to the upside today, particularly against US dollar and euro. The yen is posting strong gains against euro and US dollar as capital leaving risk markets and sending stocks southbound flows toward defensive havens.
Asia Pacific Indices
The S&P/ASX 200 has dropped under 5,700 into the lower third of its 5,655 to 5,800 sideways trading range. The RSI is falling away from 50 indicating momentum turning downward. Next support on a breakdown possible near 5,625 then 5,500.
The Nikkei 225 has turned decisively downward taking out 19,500 and its 200-day average then falling toward 19,320 with next support possible near 19,240 then 18,990 both Fibonacci levels. RSI indicates downward pressure increasing.
The Hang Seng continues to fall away from 28,000 trading down into the 27,690 to 27,810 area. Next potential support appears near 27,480 a common 23% retracement of its previous uptrend. RSI falling toward 50 indicates weakening upward momentum.
North American and European Indices
The Nasdaq 100 failed to hold 6,000 and appears to have completed a bull trap shooting star peak last Friday. The index broke 5,930 and has dropped into the 5,880 to 5,920 area with next potential support near 5,840 and its 50-day average.
The FTSE 100 has plunged back under its 50-day average near 7,400, diving down toward 7,350 with next potential support near 7,300 a channel bottom and the 200-day average. RSI slipping back under 50 signals a downswing underway.
The DAX remains stuck between its 200-day average near 12,000 and 12,225 initial Fibonacci resistance, recently dropping from 12,120 toward 12,080. Next support on a breakdown possible near 11,860. The index remains under distribution until it can break a downtrend of lower highs and retake 50 on the RSI.
Commodities
Gold is consolidating Monday’s rally up into the $1,225 to $1,340 area, with support moving up toward $1,229. An overbought RSI suggests that the metal price could be due for a rest or even a possible correction.
WTI crude oil is turning back upward today, with the price and the RSI both breaking out of downtrends and the RSI regaining 50. The price blasted through $47.00 and advanced on $48.80 before slipping toward $48.40 in normal backing and filling. Next resistance possible near $48.70 then $49.30 the 200-day average.
Gasoline is starting to really tumble back to Earth after a spike up toward $1.90 last week left it overbought on the RSI. The price has dropped back into the $1.74 to $1.78 area with next potential support in the $1.68 to $1.70 area.
FX
The US Dollar Index has paused near 92.30 with a 92.00 to 93.00 trading range emerging. It remains to be see if this is a base forming or a pause within a bigger downtrend as RSI remains below 50 and probes outside this range have been inconclusive.
EUR/USD is still reeling from being rejected by $1.2000 resistance last week, trading between $1.1860 and $1.1910. RSI steady near 60 suggests recent weakness may have been a normal setback within an ongoing uptrend.
GBP/USD is breaking out today, blasting through $1.2970 and its 50-day average then retaking $1.3000 on its way toward $1.3035. RSI regaining 50 confirms momentum turning upward. Next potential resistance near $1.3060 then $1.3130.
NZD/USD has popped up from $0.7160 toward $0.7260 with support rising toward $0.7230 from $0.7190. RSI still needs to regain 50 to signal this is an upturn rather than a trading bounce. Next potential resistance near $0.7275 then $0.7335.
AUD/USD is on the rebound, rallying up from $0.7940 and peeking back above $0.8000. RSI above 50 indicates increasing upward momentum. Next potential resistance near $0.8070.
USD/SGD keeps trending downward with resistance falling from $1.3600 toward $1.3560 while a falling RSI confirms increasing downward pressure. Next potential support near $1.3500 then a measured $1.3400.
USD/JPY continues a downswing within a broad 108.10 to 110.60 trading range. The pair has dropped back under 110.00 and 109.00 into the 108.60 to 108.90 area. RSI faltering at 50 and turning downward indicates distribution intensifying.
GBP/JPY has dropped back under 141.85 a Fibonacci level, sinking toward 141.40. RSI failing to retake 50 and turning down indicates distribution resuming. Next potential support near 141.00 then 140.40 in a downswing.
EUR/JPY is breaking down today, with the pair taking out 130.00 and the RSI taking out 50 to signal the start of a new downturn. The pair is testing its 50-day average and an uptrend support line near 129.50 but it that fails next support may not appear until the 127.75 to 128.00 area.
USD/CAD is digesting recent declines between its $1.2425 recent breakdown point and Friday’s low near $1.2335. Next potential support after that near $1.2250. RSI under 50 confirms continuing distribution.