Signs have emerged that the US Dollar may finally have peaked and a correction started. JPY, EUR and gold started the day under heavy pressure which has since relented setting up a number of bullish reversals. RSI indicators remain highly overextended for many markets indicating potential for a series of significant trading corrections.
Asia Pacific indices
Australia 200 successfully retested the downward extension of an old resistance line near 5,420 confirming a recent breakout. The index has rebounded toward 5,500 and appears to be resuming an upswing following a small correction. Next potential resistance near 5,530 then 5,600.
Japan 225 ran into resistance near 18,710 and has turned south, diving back toward 18,400 while resistance falls toward 18,440 from 18,520. RSI falling back under 70 from overbought signals a downward correction starting with next potential support near 18,200 then 18,000.
Hong Kong 50 has paused for a rest in the 22,820 to 22,880 area short of 23,000 round number resistance. Still the index has broken out of a two month downtrend and continues to form a saucer bottom.
North American and European Indices
US 30 is bumping up against the top of a 19,000 to 19,200 range where it has paused for now above 19,170 support up from 19,130. RSI really overbought indicates potential for a pause or pullback but if it does break out, next measured resistance may appear near 19,400.
US SPX 500 has rolled back under 2,200 toward 2,194 and appears to be starting a trading correction with RSI indicating upward momentum is weakening. So far the 2,190 recent breakout point is holding as support but if that gives way its next test may appear near 2,160.
US NDAQ 100 is under pressure for a second straight day diving from near 4,820 toward 4,740 with next potential support near 4,700. RSI indicates a downswing underway within a sideways trend.
UK 100 remains under pressure testing 6,700 support which has held so far. Resistance drops toward 6,770 with the index rebounding toward 6,730. RSI under 50 and falling indicates downward pressure increasing. Next potential support near 6,655 then 6,600.
Germany 30 is testing the bottom of a 10.500 to 10.800 range having falling from near 10.580. RSI under 50 and falling indicates momentum turning downward with next potential support on a breakdown near 10,445 then 10,395.
Gold broke down below $1,170 completing a 62% Fibonacci retracement of its previous uptrend to signal the start of a new downleg. After dropping toward $1,164 where support emerged, however, it has rebounded back up into the $1,172 to $1,175 area a classic bear trap reversal bottom. Oversold RSI suggests potential for a bounce with next resistance possible near $1 190. Next support on a downturn possible near $1,150
Crude Oil WTI continues to climb, rallying from near $49.10 up through $50.00 and on toward $51.30 before backfilling toward $50.50. A massive ascending triangle is forming of higher lows below $51.50 resistance. Rising RSI indicates upward momentum increasing.
US Dollar Index has levelled off between 101.00 and 102.00 pausing to consolidate recent gains. RSI has been overbought and is starting to roll over, a sign the potential for a correction is growing with next potential support near 100.00.
USDJPY appears to be peaking, encountering resistance as it approaches the 115.00 round number with more possible near 115.35. The pair has dropped back from 114.70 toward 114.10 having traded down to 113.90 with next support possible near 113.00. Overbought RSI and a negative divergence indicate upward momentum slowing and the potential for a correction growing.
EURUSD dipped under $1.0600 briefly toward $1.0585 before staging a strong rebound back up toward the $1.0640 to $1.0660 area. The pair continues to build a base in the $1.0500 to $1.0700 range.
GBPUSD has a major breakout underway today. Cable has decisively cleared $1.2500 and its 200-day average to signal the start of a new uptrend with RSI confirms upward momentum accelerating. The pair is trading near $1.2580 having encountered initial resistance near $1.2630 with its next upside test near $1.2700.
NZDUSD is sending mixed signals as it bounces around between its 200-day average near $0.7040 and its 50-day average near $0.7155. Lower highs suggest a downtrend but support above $0.7000 and trading near $0.7080 suggest it could be stabilizing.
AUDUSD has stabilized near $0.7400 having fallen from a lower high near $0.7500 toward the middle of a $.7300 to $0.7500 trading range initial resistance near $0.7420 with initial support near $0.7360.
USDSGD looks vulnerable to a correction as it continues to encounter resistance near $1.4360 with more possible near $1.4400. RSI rolling back under 70 from overbought signals a correction starting with initial support possible near $1.4260 then $1.4200.
USDJPY continues to climb but appears to be encountering resistance as it approaches the 115.00 round number with more possible near 115.35. The pair has paused in the 114.40 to 114.70 area with next potential support near 114.25. RSI suggests potential for a correction or pause but it’s been saying that for a while now.
GBPJPY may be close to a short-term top having broken out over its 200-day average near 143.85, trading up through 145.00 toward 145.60 then dropping back toward 143.40, a classic bull trap top. RSI remains really overbought and a correction possible with next support possible near 142.25.
EURJPY has paused near 121.50 to consolidate recent gains having rallied up from 120.00 toward 122.00.Overbought RSI suggests it may be due for a rest currently holding above 121.10 a Fibonacci level.
USDCAD continues to turn downward shown today by RSI breaking under 50. The pair remains under distribution with resistance falling toward $1.3400 from $1.3440. Next potential support near $1.3330 then $1.3300 a Fibonacci level and $1.3260.