Analys från DailyFX
US Dollar Digesting Gains, SPX 500 Searching for a Catalyst
Talking Points:
- US Dollar Digesting Last Week’s Five-Day Win Streak
- SP 500 Still Treading Water Below 2013 Peak Highs
- Gold, Crude Oil Consolidating at Familiar Chart Levels
Can’t access to the Dow Jones FXCM US Dollar Index? Try the USD basket on Mirror Trader. **
US DOLLAR TECHNICAL ANALYSIS – Prices edged higher after showing a Hammer candlestick above support at a rising trend line set from September 2012. Prices are correcting slightly lower after securing finish last week with the best performance since late October. A daily close above the 38.2% Fibonacci retracement at 10610 exposes the 50% level at 10638. Alternatively, a reversal back below the 23.6% Fib at 10576 targets the trend line (now at 10543) anew, followed by the February 17 low at 10520.
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 are consolidating below resistance at 1847.90, the 2013 closing high. Near-term support is at 1821.30, the 23.6% Fibonacci retracement, with a break below that on a daily closing basis targeting a rising trend line at 1810.60 and the 38.2% level at 1805.40. Alternatively, a push above resistance aims for the 38.2% Fib expansion at 1861.80.
Daily Chart – Created Using FXCM Marketscope 2.0
GOLD TECHNICAL ANALYSIS – Prices began to pull back as expected after putting in a bearish Dark Cloud Cover candlestick pattern below trend line resistance set from April 2013. Breaking below rising trend line support (now at 1319.10) initially exposes the 23.6% Fibonacci retracement at 1295.85. Trend line resistance is now at 1337.40, followed by the February 17 high at 1339.85.
Daily Chart – Created Using FXCM Marketscope 2.0
CRUDE OIL TECHNICAL ANALYSIS – Prices are consolidating below resistance at 103.29, the 38.2% Fibonacci expansion. A break higher targets the 50% level at 104.48. Alternatively, a move below the 23.6% Fib at 101.81 exposes 100.73, the December 27 high.
Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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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.
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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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
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