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Chart Signals: Neckline tests underway as indices retreat

Chart Signals: Neckline tests underway as indices retreat

Indices have been sliding through the US trading session with the US 30 and US SPX testing the necklines of head and shoulders top formations where breakdowns could be a sign of growing bearishness. Other indices like the Australia 200 have been falling in sympathy while the India 50 and Hong Kong 50 have been trying to muster up support.

Asia Pacific Indices

Australia 200 is struggling with 5,400 resistance, falling back toward 5,350 with next potential support near 5,335 then 5,300 a former breakout point. RSI rolling down from 70 indicates upward momentum fading and a correction starting.

Japan 225 continues to trend sideways between 16,280 and 16,815 both Fibonacci levels while RSI sitting on 50 confirms neutral momentum. Index recently dropped back from 18,790 back toward 16,535.

Hong Kong 50 is challenging 20,000 once again which it needs to retake to signal an upturn. Next resistance near 20,210 a Fibonacci level if successful. Support rises toward 19,880.

India 50 continues to climb, breaking out of a short term downtrend through 7,865 and retesting it as support after trading up toward 7,930 with next resistance in the 8,000 to 8,080 area between a round number and Fibonacci level. RSI holding 50 confirms uptrend intact.

North American and European Indices

US 30 is retesting 17,515 support at a 23% Fibonacci retracement level and the neckline of a head and shoulders top after getting pounded down from 17,750. RSI retesting 50 as new resistance and falling confirms downward pressure increasing. Next support possible near 17,120 where a 38% retracement and the 200-day average converge.  .

US NDAQ 100 once again failed to break through resistance at 4,400 (channel and moving average resistance) on the index and 50 on the RSI  indicating downward momentum remains intact. The index has dropped back toward 4,320 with channel support in place near 4,280

US SPX 500 is testing 2,040 again, a 23% Fibonacci retracement test and the neckline of a head and shoulders top. RSI sitting below 50 confirms momentum turning downward. Next support on a breakdown near 2,000 where a round number and 38% retracement level converge.

UK 100 is testing key resistance again, clearing recent resistance near 6,170 and its 200-day average but still struggling with its 50-day average near 6,220. Support rises toward 6,140 from 6,080. RSI gaining on 50 indicates an upturn in momentum pending. Next upside tests possible near 6,300 then 6,450.

Germany 30 peeked back above 10,000 but after faltering near 10,075 it has rolled over and dropped back under again, falling into the 9,830 to 9,890 area. Overall, it appears to be stuck in a trading range between 9,750 and 10,125.


Gold is bouncing around between $1,270 and $1,285 as it forms a symmetrical consolidation triangle. RSI holding 50 and a higher low suggest this may be another consolidation phase within an ongoing uptrend.

Crude Oil WTI continues to climb, breaking through $48.10 a Fibonacci level with next resistance at the $50.00 round number while support rises toward $47.80 from $47.40. RSI getting overbought suggests a trading correction possible sometime soon.


US Dollar Index is holding steady above 94.00 where it broke out of a downtrend trading near 94.60 with next resistance near 95.20. RSI holding above 50 following its own breakout confirms momentum turning upward.

EURUSD is bouncing around between $1.1300 and $1.1350 trading near its 50-day average with next support near $1.1285 and next resistance near $1.1385.

NZDUSD has bounced up into the $0.6800 to $0.6840 area but it really needs to retake $0.6860 to call off its recent breakdown. RSI holding 40 suggests momentum shifting into neutral with more support in place near $0.6740.

AUDUSD continues to bounce up off its 50-day average trading up into the $0.7320 to $0.7360 area. RSI suggests downward pressure starting to ease but the pair needs to clear $0.7400 to signal an upswing that could challenge $0.7500 initially.

USDCNH is bouncing around between 6.5380 and 6.5480 as it works off an overbought RSI between 6.5285 support near 6.5600 resistance.

USDSGD is holding steady near $1.3700 in a $1.3640 to $1.3770 trading range as it consolidates its recent breakout.

USDJPY is sitting on 109.00 for the pair and 50 on the RSI as it pauses trying to decide whether to take a run at the 110.00-110.50 area which includes a round number, Fibonacci test and 50-day average or roll over and fall back toward 18.25 channel support.

EURJPY keeps trying to turn higher bouncing off a higher low near 122.50 toward the 123.40 to 123.70 area. RSI gaining on 50 suggests an upturn in momentum pending but it still needs to clear the 50-day average near 124.65 to signal an upturn.

CADJPY is holding steady with the pair sitting on 84.55 a Fibonacci level and the RSI sitting on 50. Pair trading in a 83.55 to 85.25 channel below its 50-day average.

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