Last week finished with another wave of optimism as the US 30 and US SPX 500 rallied to new all-time highs. Continued weakness for EUR sinking toward $1.0500 propelled the US Dollar higher putting pressure on other currency contracts like gold, AUD and especially JPY. Crude oil has started to advance again and could be active to start the new week as it tests $52.00 resistance. Trading to start the week could be impacted by the result of the OPEC/non-OPEC producers meeting and Italian bank problems potentially coming to a head with the ECB rejecting a plea from Monte Paschi for more time to raise capital.
Asia Pacific indices
Australia 200 keeps climbing, building on its breakout over 5,520 advancing on 5,570 with next resistance possible in the 5,600 to 5,620 area near its July peak. Support rises toward 5,550. RSI confirms upward momentum increasing.
Hong Kong 50 remains under distribution, continuing to struggle with the 23,000 round number and falling toward the 22,725 to 22,775 area with next potential support near 22,485. RSI indicates flat to lower momentum.
Japan 225 is still screaming upward driving up form near 18,810 through 19,000 and on toward 19,200 with resistance emerging near 19,230 then a measured 19,385. RSI overbought and index going parabolic suggest growing risk of a correction.
North American and European Indices
US 30 continues to reach new heights, advancing on 19,700 with next potential resistance near the 19,750 and 20,000 round numbers. Even though RSI is extremely overbought and a correction possible the 20,000 appears to be increasingly becoming a big psychological draw. Initial support in a pullback possible near 19,620 then 19,460.
US SPX 500 remains under accumulation trading up toward 2,255 with next upside resistance possible near 2,260 then 2,295. Support rises toward 2,250 from 2,235. Overbought RSI suggests potential for a pullback at some point.
US NDAQ 100 is advancing on another retest of 4,900 channel resistance which it really needs to clear to call off a trend of lower highs in the RSI and the index. For the moment, momentum appears to be turning upward with the pair advancing on 4,875 from 4,850. On a breakout the 5,000 round number could be challenged.
UK 100 continues to advance, driving from 6,925 level it broke out over Thursday toward 6,970. RSI holding above 50 also indicates upward momentum still increasing. Next upside resistance possible near the 7,000 round number.
Germany 30 briefly touched a new 52-week high up near 11,230 and now appears to be pausing to consolidate this week’s big rally and breakout over 11,000 trading between 11,180 and 11,220. An overbought RSI suggests it may need to stop for a rest in the near term.
Gold has dropped back from near $1,172 a Fibonacci level to retest $1,155 where it appears to be forming a triple bottom but a failure would signal the start of a new downleg. Gold bounced back into the $1,158 to $1,162 area with next resistance near $1,165. RSI still oversold indicates potential for a bounce.
Crude Oil WTI has resumed its uptrend, trading back up above $50.00 after support came in at a higher low near $49.25. Currently trading near $51.20 next potential resistance appears near $52.00 then a measured $54.75. RSI confirms upward momentum increasing.
US Dollar Index has turned back upward on both the index and the RSI following a correction with the index advancing on 101.70 while support rises toward 101.20. A test of its previous peak near 102.15 could complete a double top or signal the start of a new upleg.
EURUSD remains under pressure with $1.0600 giving way and the pair falling toward $1.0530 with next potential support near $1.0500 where a test could end in a triple bottom or a big breakdown. RSI falling away from 50 confirms downward pressure increasing.
GBPUSD continues its correction with the pair slipping toward $1.2550 and resistance falling toward $1.2620. The pair holding uptrend support above $1.2500 and RSI holding 50 indicate underlying accumulation remains intact through the current correction phase.
NZDUSD continues to struggle with $0.7195 Fibonacci resistance unable to break out and sliding back toward $0.7150 and its 50-day average. RSI near 50 indicates neutral momentum. Underlying accumulation continues above $0.7050 with a trend of higher lows intact. Next resistance on a breakout possible near $0.7215 then $0.7260.
AUDUSD is showing signs of weakness after failing to break out over $0.7500. The pair has slipped back toward $0.7440 with downside tests possible near $0.7405 then $0.7370 and $0.7300. RSI failing to retake 50 and a pending death cross of the averages suggest increasing downward momentum.
USDSGD remains in an uptrend bouncing up the bottom of a $1.4150 to $1.4370 trading range rallying toward $1.4320 as support rises toward $1.4270. RSI holding 50 confirms underlying accumulation intact. Next resistance on a breakout possible near $1.4420.
USDJPY broke out Friday, clearing 114.80 which may become initial support, to signal the start of a new upleg and advancing through 115.00 on toward 115.35 Fibonacci resistance. Next measured test near 116.60. Overbought RSI and a negative divergence suggest this could be approaching a buying climax, but the gains did hold into the weekend to confirm the strength of underlying interest.
GBPJPY remains in consolidation mode trading between 142.25 and 146.45 the 50% and 62% Fibonacci retracements of its previous downtrend. Recently the pair has been hovering near 145.00 above its 200-day average near 143.20.
EURJPY ran into resistance near 123.00 but in the ensuing correction has found initial support near 121.00 and its 50-day average. The pair has bounced toward 121.60 but RSI suggests a correction possible as upward momentum fades with next potential support near the 120.00 round number then 119.00.
USDCAD continues to steadily decline, with resistance falling toward $1.3200 from $1.3300 and the pair drifting toward $1.3160 where it has found some support and paused to work off a slightly oversold RSI. Next potential support near $1.3115 on trend.