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Chart Signals: Crude oil plunges; Negative divergences rain on breakout party

It has been a big day for trading. Crude oil went diving off a cliff taking out a big round number and multiple moving averages in a big plunge.  There were multiple breakouts by indices to new highs for Hong Kong 50, US SPX 500 and US NDAQ 100 but enthusiasm has been tempered a bit by RSI’s failing to confirm the breakouts and negative divergences suggesting upward momentum slowing. 

Asia Pacific Indices

Australia 200 is still struggling with 5,800 lower resistance, down from the 50-day average near 5,840. RSI still under 50 suggests neutral to downward momentum. Support in place near 5,755. 

Japan 225 keeps creeping up toward a potential retest of 20,000 resistance recently trading between 19,780 and 19,850. RSI holding 50 and rebounding indicates underlying uptrend intact and upward momentum increasing again. 

Hong Kong 50 is in breakout mode again, clearing 25,500 and rallying up toward 25,700 with next measured resistance possible near the 26,000 round number. RSI overbought again and a negative divergence emerging. 

North American and European Indices

US 30 is testing 21,130 resistance today, but has been unable to get through so far, dropping back toward 21,090. It has regained 21,000 and support has moved up toward 21,050. RSI suggests momentum is starting to turn back upward. Next measured resistance on a breakout possible near 21,360. 

US SPX 500 is breaking out today, clearing 2,400 and advancing on 2,416. RSI, however, is still in a downtrend which is needs to break out of to confirm the upturn. Next measured resistance possible near 2,422 with initial support near 2,380. 

US NDAQ 100 is breaking out today, clearing 5,725 to a new all-time high near 5,785. The RSI, however, has failed to confirm the breakout, a negative divergence that suggests upward momentum slowing. Next measured resistance possible near 5,815 with initial support near 5,700 then 5,635. 

UK 100 has dropped back into the 7,500 to 7,520 area after running into resistance near 7,545. The RSI is not confirming recent advances suggesting upward momentum is slowing and a 7,450 to 7,550 consolidation range emerging. 

Germany 30 is still struggling to make further ground trading between 12,540 and 12,720 near 12,625 still well below its recent high near 12,900. RSI setting a lower high and testing 50 suggests a downturn pending. Next potential support at the 50-day average near 12,335. 


Gold continues to consolidate recent gains between $1,245 and $1,265 recently trading near $1,255. RSI steady just above 50 indicates this as a normal consolidation within a bigger uptrend. Next potential resistance near $1,272. 

WTI has been totally crushed today, rolling over today after failures at lower highs for both the price and the RSI indicate the recent upswing has ended. The price has dropped off a cliff from $51.75 resistance down through $50.00, then taking out its 50 and 200-day averages near $49.25 on its way toward $48.30. RSI diving under 50 confirms momentum turning downward. Next support possible near $48.00.  


US Dollar Index has stabilized near 97.00, trading between 96.70 and 97.40 with next rebound resistance possible near 97.80. RSI suggests downward momentum levelling off. 

 EURUSD has paused near $1.1200 trading between $1.1155 and $1.1275 while consolidating recent gains and working off an overbought RSI. So far this appears to be a normal pause within an uptrend. 

GBPUSD continues to struggle with $1.3000 resistance trading near $1.2930. It remains in an uptrend above $1.2910, but falling indicates upward momentum is slowing toward neutral. 

NZDUSD ran into resistance near $0.7055 and has dropped back a bit, but the pair holding above $0.7000 and the RSI holding above 50 suggests this as a pause rather than a correction so far. More support at the 50-day average near $0.6965 with more resistance possible at the 200-day average near $0.7105.  

AUDUSD failed to hold above $0.7500 and has been knocked back down toward $0.7460 with next support near $0.7445 then $0.7400. RSI sitting on 50 indicates neutral momentum.

USDSGD successfully retested $1.3820 support and may be completing a double bottom as it bounces back up toward $1.3870. RSI suggests downward pressure levelling off. Initial resistance possible near $1.3910 then $1.3940. 

USDJPY is testing the top of its 110.65 to 112.15 trading range today recently trading near 111.80. RSI advancing on 50 indicates an upturn in momentum pending. Next potential resistance on a breakout near 113.00 then 113.35. Initial support has moved up toward the 50-day average near 111.25.   

GBPJPY continues to stabilize near 145.00 with support having moved up toward `144.60 from 143.30. Initial resistance possible near 145.45. RSI holding 50 indicates underlying uptrend intact through the current correction. 

EURJPY is still trending upward trading back above 125.00 and advancing in a retest of 125.75 which could end in a breakout or a double top. A lower high in the RSI indicates upward momentum slowing and a negative divergence possible. 

USDCAD found some support near $1.3385 and has bounced back up toward $1.3485. So far price action and the RSI suggest this is likely a common trading bounce within a bigger downtrend with the rally contained by $1.3500 and the 50-day average. 

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