THE TAKEAWAY: The US Dollar launched a convincing recovery having found technical support but overall positioning still carries remnants of reversal risk.
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US DOLLAR TECHNICAL ANALYSIS– Prices recovered from rising trend line support to challenge resistance at 10879, the 23.6% Fibonacci expansion. A break above that exposes the 38.2% level at 10948. Negative RSI divergence continues to warn of ebbing upward momentum however. Trend line support is now at 10793, with a turn below that initially targeting the 23.6% Fib retracement at 10763.
Daily Chart – Created Using FXCM Marketscope 2.0
SP 500 TECHNICAL ANALYSIS – Prices are consolidating above support in the 1649.60-51.60 area, marked by the 23.6% Fibonacci retracement and the 100% expansion. A break below this barrier initially exposes the 38.2% retracement at 1629.40. Near-term resistance is at 1676.50, the 123.6% expansion, with a reversal above that eyeing the 138.2% mark at 1693.10.
Daily Chart – Created Using FXCM Marketscope 2.0
GOLD TECHNICAL ANALYSIS – Prices completed a Bullish Engulfing candlestick pattern above support at 1348.97, the 38.2% Fibonacci retracement level, hinting at gains ahead. Initial resistance is at 1402.11, the 23.6% level, with a break above that targeting the 14.6% Fib at 1434.86 and the May 3 high at 1488.00. Alternatively, a move below support eyes the 50% expansion at 1306.02.
Daily Chart – Created Using FXCM Marketscope 2.0
CRUDE OIL TECHNICAL ANALYSIS– Prices bounce from support at 93.34, the May 10 low. Near-term resistance is at 96.85 a falling trend line set from mid-September 2012. A bearish Dark Cloud Cover candlestick pattern and negative RSI divergence argue in favor of a downside scenario however. A move below 93.34 initially exposes the May 15 bottom at 93.11.
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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