THE TAKEAWAY: The US Dollar and the SP 500 continue to decline in tandem, with the stock index down for a third day as the benchmark currency broke key chart support.
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US DOLLAR TECHNICAL ANALYSIS – Prices took out support at a rising trend line set from mid-June, with sellers now aiming to challenge the 61.8% Fibonacci expansion at 10702. A break below this barrier exposes the 76.4% level at 10656. Near-term resistance is at 10739, the 50% Fib, followed by the trend line (now at 10751).
Daily Chart – Created Using FXCM Marketscope 2.0
** The Dow Jones FXCM US Dollar Index and the Mirror Trader USD basket are not the same product.
SP 500 TECHNICAL ANALYSIS – Prices pulled back as expected after putting in a Hanging Man candlestick. Near-term support is at 1687.40, the May 22 high, a barrier reinforced by the bottom of a rising channel set from mid-July (1690.80). A break below that targets the 23.6% Fibonacci retracement at 1674.10. Channel resistance is now at 1714.70.
Daily Chart – Created Using FXCM Marketscope 2.0
GOLD TECHNICAL ANALYSIS – Prices broke lower as expected after putting in a Bearish Engulfing candlestick pattern below resistance at the top of a rising channel set from late June. Sellers are now challenging the 23.6% Fibonacci expansion at 1274.92, with a break below that exposing the 38.2% level at 1229.97. Near-term resistance is at 1302.62, the 14.6% expansion, followed by the July 24 high at 1347.57.
Daily Chart – Created Using FXCM Marketscope 2.0
CRUDE OIL TECHNICAL ANALYSIS– Prices appear to be carving out a double top below the July 19 swing high at 108.89. A break below the 23.6% Fibonacci retracement at 105.06 has exposed the 38.2% level at 102.70, with a further push beneath that eyeing the 50% Fib at 100.79. Alternatively, a move back above 105.06 targets 108.89 anew.
Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
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