Analys från DailyFX

S&P 500 Trading Outlook: Looking to the Nasdaq 100, Dow for Clarity

Published

8 år ago

11 april, 2017

DailyFX

What’s inside:

U.S. indices drop hard on FOMC minutes last week, follow-through could be in store soon
Nasdaq 100 putting in possibly bearish sequence on hourly, 5400 is big
Dow has a key development underway resolution soon

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On Wednesday, US stocks were hit hard on the FOMC minutes. Since then, they have floundered around, doing little to reverse the swoon. This is setting them up for a leg lower if they can’t quickly gain traction. While all the indices are obviously highly correlated, the Nasdaq 100 and Dow are presenting the cleanest pictures at the moment, which we will use to help gauge where the broader SP 500 is heading over the short-term.

Nasdaq 100

The Nasdaq 100 has a clean head-and-shoulders pattern developing on the hourly chart, with a strong neckline right around 5400. This level has been in play since the first trading day of March. A swift break below 5400 will confirm the HS set-up and likely kick off a move to the downside towards the low 5300s, where the 3/27 swing-low sits at 5316 and near the upper parallel to the Feb ’16 trend-line. There should be decent support there, but should it break then we could see the broadening wedge on the daily act as a signal for a larger top. For now, though, our focus is on 5400. It is support until it isn’t, and for ‘would-be’ longs this isn’t a bad spot from a risk/reward perspective. A break below, an event which could very soon unfold, then favors shorts.

Daily

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Hourly

Created with TradingView

Dow

The Dow has a similar configuration, sans the spike and drop on the FOMC minutes, it is coiling towards the apex of a wedge on the hourly. Should the wedge trigger to the downside along with a break of 5400 in the Nasdaq 100, we should see good downside momentum come in across the board. A break higher out of the coiling pattern would put pause on the notion of seeing lower prices.

Daily

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Hourly

Created with TradingView

SP 500

The fierce rejection from the trend-line running off the March high could be a second lower high in what may be a lower low, lower high sequence developing towards another drop. It, too, like the other indices has a similar short-term technical sequence with 2345 being a key point of support. A break below will also breach of the November trend-line and bring the 3/27 low at 2322 into focus. A close above the top-side trend-line on the daily and break above the 4/5 high at 2378 will negate the currently bearish tilt.

Daily

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Hourly

Created with TradingView

For a longer-term look at the indices, see our Q2 forecast in the Trading Guidessection.

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email by signing up here.

You can follow Paul on Twitter at @PaulRobinonFX.

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form