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Chart Signals: Capital returns to risk markets as JPY peaks

Chart Signals: Capital returns to risk markets as JPY peaks

Technicals increasingly suggest that the recent bear market has ended and a reversal underway. The recent reversals in JPY and gold suggest that we may have seen the last hurrah for defensive plays earlier this week. A double top in gold, double bottom in USDJPY and hammer/morning star in EURJPY all suggest a trend reversal starting. Meanwhile breakouts by CAD and US indices plus strength in crude oil all indicate continuing accumulation in stocks, resource currencies and commodities. GBP also appears to have reached a point of extreme bearishness and has stabilized.

Asia Pacific Index Chart Signals

Australia 200 has started to rebound after successfully retesting 4,850 support and bouncing toward 4,880 with next resistance possible near 4,930 then 5,000. RSI bouncing around 50 indicates sideways momentum.

Japan 225 has rallied up off of 15,500 back up through 16,000 and on toward 16,190 to resume base building. RSI advancing on 50 signals downward pressure easing and an upturn pending. Next potential resistance near 16,300 where a breakout would complete an ascending triangle, then 16,500.

Hong Kong 50 continues to trend sideways in a channel between 18,775 and 19,555 more recently in the 18,940 to 19,040 area regaining the 19,000 level. RSI trending up toward 50 indicates downward pressure fading and an upturn underway.

India 50 remains in a downtrend slicing back under 7,000 and on toward 6,950 after failing to overcome Fibonacci resistance near 7,055. Next potential support near 6,900 then 6,855.

North American and European Index Chart Signals 

US 30 is advancing again driving through up off 16,430 a higher low on trend through its 50-day average near 16,550 and on toward 16,640 with support rising toward 16,610 Next potential resistance near 16,660 its recent high. RSI holding above 50 indicates continued accumulation.

US NDAQ 100 is challenging the top of its 4,100 to 4,225 Fibonacci trading channel with support rising toward 4,190. On a breakout, the 50-day average near 4,280 could be challenged. RSI holding 50 indicates momentum still trending sideways for now.

US SPX 500 is breaking out over 1,940 Fibonacci and 50-day average resistance with support moving up toward 1,930 and next resistance possible near 1,955 or 1,975. RSI indicates underlying upward momentum intact through the current consolidation phase.

Germany 30 has stabilized around 9,325 a 23% Fibonacci retracement of its recent downtrend spending today trading between 9,290 and 9,380 within yesterday’s range of 9,110 to 9,415. A higher low indicates continuing accumulation.

UK 100 is on the move higher again, rallying up from 5,850 through 6,000and on toward 6,040 with support rising toward 5,980 from 5,910. Next potential resistance near 6,065 then 6,125. RSI holding 50 signals momentum still turning upward.

Commodity Chart Signals

Gold ran into resistance at a lower high near $1,242 down from $1,250 and has dropped back toward $1,232 with more support possible near $1,222. It appears yesterday’s rally was a double top of sorts and that the current consolidation period could be extended. RSI under 70 and falling suggests a deeper correction remains possible.

Crude Oil WTI has rallied up off $29.60 support through $30.00 and on toward $31.25 with support rising toward $30.80 and next resistance near $31/50 then $32.20. RSI back above 50 indicates momentum neutral to positive.

FX Chart Signals

US Dollar Index has levelled off near 97.50 after stalling short of 98.00 yesterday. RSI faltering below 50 again suggests the recent trading bounce may be ending and its general retreat resuming. Initial support tests possible near 97.30 then 96.55 and 96.10.

EURUSD continues to attract support above $1.1000 with more possible at its 50-day average near $1.0970. It’s bumping up against its 200-day average near $1.1050 with next resistance on a breakout possible near $1.1111 a round number and Fibonacci test.

GBPUSD is starting to bounce back having established support near $1.3910. It’s currently retesting $1.4000 which could either confirm or call off yesterday’s breakdown. On a breakout, next resistance appears near $1.4080 with initial support near $1.3940.

NZDUSD is taking another run at the top of its $0.6560 to $0.6730 channel, rallying up from $0.6680 toward $0.6720. Next resistance on a breakout possible near $0.6870 a previous high. RSI lifting up off 50 indicates upward momentum increasing.

AUDUSD is starting to advance again climbing from $0.7190 toward $0.7240 as an ascending triangle base continues to form below $0.7300. RSI above 50 and trending higher indicates upward momentum accelerating.

USDCNH continues to quietly creep higher trading near 6.5360 above 6.5325 a Fibonacci level with next resistance near 6.5550 then 6.5775 the 50-day average.

USDJPY continues to rally up out of a double bottom near 111.00 jumping from 112.50 toward 113.00 with next potential resistance near 113.35 then 114.25. A higher low in the RSI and oversold readings suggest potential for a bounce as downward pressure weakens.

EURJPY has a turnaround underway that’s nearly a morning star with a down candle followed by a hammer then an upward candle signalling bears washed out. Recent dip under 123.00 looks like a selling climax as well. RSI back up above 30 from oversold confirms an upward correction underway with next potential resistance near 1125.00 then 125.65 with support rising toward 124.50 from 123.15.

CADJPY is turning back upward once again driving up off 82.40 toward channel resistance near 83.60 with next test on a breakout near 84.55 a 38% retracement of a recent downtrend. RSI probing 50 where a breakout would confirm an upturn in momentum.

USDSGD remains stuck in a range between $1.3890 and $1.4100 currently sitting on $1.4000. RSI failing to retake 50 indicates broader downtrend intact.

USDCAD is breaking down taking out $1.3630 Fibonacci support to complete a descending triangle to signal the start of a new downleg and falling to test next potential support in the $1.3500 to $1.3535 area followed by $1.3465. RSI confirms downward momentum intact. Resistance falls toward $1.3610 from $1.3690.

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