Indices continue to break down and between the Trump trade unwinding and political risks increasing (new North Korea missiles have been in focus this weekend), JPY has been rallying with capital flowing into defensive havens.
The week starts with traders getting their first chance to react to disappointing US retail sales and US consumer prices which came out Friday morning. Both reports were below expectations and down from last month. Monday, China GDP, retail sales and industrial production could move the markets.
Asia Pacific indices
Australia 200 continues to roll over, falling back under 5,900 back toward 5,860. The index is holding above 8,835, its recent breakout point, keeping its uptrend intact for now but a failure would signal a downturn. RSI rolling over indicates upward momentum weakening. Next potential support at the 5,775 near the 50-day average, followed by 5,700.
Hong Kong 50 remains in an uptrend, still holding above 24,000 round number and 50-day average support plus 50 on the RSI. Lower highs in the index and the RSI and a descending triangle forming, however, suggest that the index may be coming under distribution. Next potential support near 23,635 on a breakdown.
Japan 225 remains under distribution sliding in a falling channel of lower highs and lower lows. The index has taken out 18,500 falling toward 18,320 with next potential support near 18,280 then the 18,000 round number and the 200-day average. RSI oversold suggests it may need to pause at some point.
North American and European Indices
US 30 keeps trending downward, breaking 20,500 and falling toward 20,450 while resistance falls toward 2,0545. RSI under 50 and falling confirms downward pressure increasing. Next potential support near 20,380 then 20,300 a 23% retracement of the post-election advance.
US SPX 500 broke down Friday, falling under a trend support line near 2,345 to resolve a symmetrical triangle to the downside. RSI under 50 and trending lower confirms downward momentum accelerating. Next potential support near 2,313 a 23% retracement of the previous uptrend, then 2,200.
US NDAQ 100 is still rolling over, dropping from 5,400 toward 5,355 and a test of its 50-day average. RSI has already broken under 50 to signal a downturn with index confirmation pending. Next potential support appears near 5,300 then 5,265 a 23% retracement of the post-election advance.
UK 100 continues to form a head and shoulders top, falling away from shoulder resistance near 7,400 back into the 7,300 to 7,350 area around its 50-day average. Neckline support in place near 7,260.
Germany 30 is still sliding with 12,165 a former support level, emerging as new lower resistance while the index declines toward 12,090. The index remains in an uptrend above its 50-day average near the 12,000 round number and its 50-day average. RSI testing 50 where a break would signal a downturn in momentum. Next potential support near 11,860 a recent low.
Gold has paused in the $1,285 to $1,290 area continuing to attract support as it digest this week’s big breakout rally and work off an overbought RSI. Next support possible near the $1,300 round number with next support in a correction possible near $1,272.
Crude Oil WTI is consolidating recent gains and working off an overbought RSI near $52.70 having encountered resistance near $53.50. Initial support in a pullback possible near $52.40 then $52.00. Next upside tests near $54.00 then $54.45 the top of the broader sideways channel.
US Dollar Index held 100.00 round number support bouncing back up toward 100.45 but it still looks troubled with the RSI still under 50 and a bearish Evening Star still in place. Next resistance possible near 100.60 with next potential support near 99.75.
EURUSD’s latest rally attempt fizzled out near $1.0675 another lower high. RSI failing to retake 50 and turning downward confirms its broader downtrend remains intact. Next potential support appears near $1.0600 then $1.0585 a Fibonacci test and recent low.
GBPUSD has paused for a rest near $1.2500 having met some resistance near $1.2570 with more possible near $1.2600, while attracting support well above its 50-day average near $1.2410. RSI bouncing around between 40 and 60 indicates sideways momentum.
NZDUSD is trading near the middle of a $0.6900 to $0.7100 trading range, but unable to retake neither $0.7000 nor 50 on the RSI, this appears to be a pause within a larger downtrend. A double bottom could be forming near $0.6900 but it’s too early to tell.
AUDUSD appears to be trying to form a base trading just above its 200-day average near $0.7550 and the $0.7500 round number. The pair needs to clear $0.7600 along with 50 on the RSI to signal an upswing with next resistance near $0.7620 the 50-day average then $0.7680.
USDSGD is sitting just below $1.4000 for the pair and 50 on the RSI as it bounces around between $1.3950 and $1.4085 both Fibonacci levels with the lower bound also near the 200-day average. RSI holding steady below 50 indicates continuing distribution.
USDJPY found support at its 200-day average near 108.70 and has bounced back up into a Fibonacci cluster between 108.90 and 109.25. An oversold RSI indicates it may need to pause for a rest following recent big declines but it remains in a bigger downtrend below 110.00.
GBPJPY remains under distribution as a trend of lower highs above 136.70 continues to form a bearish descending triangle. RSI consistently below 50 indicates steady downward pressure. The pair needs to clear 138.60 to signal an upturn.
EURJPY remains under pressure with resistance falling toward 116.00 and the pair dropping toward 115.60. Next potential support appears near 115.00 then 114.00, RSI is getting really oversold so a bounce looks possible but at the same time it continues to indicate increasing downward pressure.
USDCAD staged a strong bounce up off its 200-day average near $1.3225 rallying toward $.3325 before pausing short of $1.3360 resistance. RSI held 40 suggesting its underlying uptrend remains intact but needs to retake 50 to confirm an upswing.