Friday saw indices come under pressure while currencies reversed some of their big moves of the previous two days as traders elected to get out of positions ahead of the weekend and Chinese holidays. While some markets had been overextended, corrections have brought them back toward their 50-day averages.
While many traders appeared to be closing out positions ahead of the weekend, the big question is how much this could carry through into Monday’s Asia Pacific trading or if we may see a reversal. With several markets being closed for holidays for part of this week, we could see more volatility to kick things off.
Asia Pacific indices
Australia 200 continues to trend sideways between 4,900 and 5,080 with resistance falling toward 4.940 from 5,000 and next support near 4,885. RSI suggests momentum sideways to slightly downward.
Hong Kong 50 finished last week trading between 19,100 and 19,270 holding above the 19,000 round number. Next resistance near 19,485 with channel support near 18.610.
India 50 continues to stabilize rallying up off of 7,400 toward 7,500. It needs to clear 7,515 on the index and 50 on the RSI to signal the start of a new uptrend and break the current downtrend of lower highs and lower lows.
Japan 225 has drifted back toward 16,500 where it appears to be finding some support although if it fails, a retest of 16,000 looks possible. RSI falling away from 50 indicates downward momentum increasing. Initial bounce resistance near 15,550.
North American and European Indices
US 30 failed to get through against resistance in the 16,475 to 16,500 area again near a 38% retracement of its previous downtrend, dropping back into the 16,140 to 16,190 area with next potential support in the 16,000 to 16,030 area with initial resistance near 16,270. RSI testing 50 where a breakout would confirm an upturn in momentum but its having trouble getting through.
US NDAQ 100 was hammered down from near 4,180 toward a test of the 4,000 round number, taking out a Fibonacci level near 4,080 along the way. RSI falling toward 30 indicates growing downward pressure. Next support at the August low near 3,920 with initial resistance near 4,030 then 4,060.
US SPX 500 broke down Friday taking out 1,900 and dropping toward 1,875 with next support near 1,855 then 1,815. RSI falling away from 50 signals momentum turning downward again.
Germany 30 broke down below 9,275, a key support level Friday, signalling the start of a new downtrend with next potential support near 9,230 then 9,000. RSI rolling down indicates downward pressure building.
UK 100 took a setback Friday faltering near 5,950, and diving under 5,855 on its way toward the 5,825 to 5,840 area with net potential support near 5,765. RSI back under 50 signals momentum turning downward.
Gold keeps screaming higher, breaking through $1,155 a Fibonacci level which may become support and carrying on toward $1,170. RSI confirms upward momentum still increasing but overbought reading and a parabolic price trend suggest a trading correction possible in the near term.
Crude Oil WTI drifted back Friday but successfully retested $30.00 support with more in place at $29.00. Initial resistance near $30.40 then $31.00 and $32.35 on a bounce. RSI indicates sideways channel trading continues.
US Dollar Index is having an inside day consolidating between 96.45 and 96.75 near the bottom of yesterday’s 96.30 to 97.40 range. RSI near oversold indicates the potential for a pause or short term bounce after a big free fall.
EURUSD has dropped back from near $1.1255 Fibonacci resistance through $1.1200 and on toward $1.1155 in a trading correction of an overbought RSI. A Fibonacci channel between $1.1111 and $1.1255 appears to be emerging.
NZDUSD ran into resistance ne $0.6740 and was pounded back toward $0.6620 where it has held its 50-day average so far. RSI holding 50 suggests this to be a correction within an emerging uptrend with next support near 40.6600 and $0.6560 its recent breakout point.
AUDUSD was unable to hold above $0.7200 and has been slammed back toward $0.7070 in a big correction but with RSI momentum holding 50, AUD remains in an uptrend of higher lows above $0.7000.
USDCNH has found some support for now at its 50-day average near 6.5620 but RSI falling under 50 suggests momentum turning downward an a retest of 6.5325 a Fibonacci level possible. Initial upside resistance near 6,5770.
USDJPY held 116.15 a key long term support level and has bounced back up into the 116.80 to 117.40 area stabilizing near 117.00. It needs to get back up above 118.00 to call off the current downtrend.
EURJPY is bouncing around between 130.00 and 132.00 around its 50-day average near 130.50. RSI drifting back toward 50 suggests momentum shifting sideways.
CADJPY continues to backslide in a trading correction, remaining below 85.00 and falling back under 84.55 and on toward 84.10 with next support near 83.40. RSI slipping back under 50 confirms a retrenchment of its recent rally underway.
USDSGD has bounced back above $1.4000 from $1.3930 toward $1./4080 but a lower high suggests this is likely a correction within an emerging downtrend.
USDCAD is on the rebound bouncing up from $1.3755 a Fibonacci level toward $1.3915 and its 50-day average where the rally has been contained so far. Next potential resistance near $1.4000 with initial downside support near $1.3880.