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Chart Signals: Tests and retests of channel boundaries underway

Chart Signals: Tests and retests of channel boundaries underway

Last week finished with a number of markets either finishing moves (some with hammer candles) and going into consolidation mode, or nearing the end of patterns and looking to break out in one direction or another. JPY and Japan 225, plus the Hong Kong and US markets could be active to start the week.

Asia Pacific indices

Australia 200 is holding steady consolidating recent gains between 5,300 and 5,400. RSI falling back toward 50 suggests momentum fading from upward to neutral.

Hong Kong 50 has been picking up off 19,500 support with RSI climbing up from 30 confirming downward pressure weakening. It still needs to retake the 20,000 round number to confirm an upturn with next resistance near 20,210 a Fibonacci level.

India 50 is back testing 7,750 as it trends sideways in a channel between 7,675 and 7,950 with more resistance possible near the 8,000 round number. RSI sliding under 50 suggests momentum turning downward with next potential support near 7,515 a Fibonacci level.

Japan 225 is testing the top of a 16,265 to 16,815 Fibonacci trading channel and appears poised for a breakout. Higher lows in the index and the RSI suggest renewed accumulation and growing upward momentum. Next tests on a breakout possible near 17,000 then 17,130.

North American and European Indices

US 30 is retesting 17,515 the neckline of a head and shoulders top and a Fibonacci level as new resistance confirming its recent breakdown so far. Initial support near 17,470 then the 17,325 level it bounced off Thursday. RSI under 50 indicates downward momentum still intact.

US NDAQ 100 rallied up through 4,345 toward 4,380 advancing toward the top of a within a 4,280 to 4,400 trading channel. RSI gaining on 50 indicates an upturn in momentum pending. Next upside resistance near 4,500 where a round number and Fibonacci test converge.

US SPX 500 has bounced up out of a hammer candle and back above 2,040 suggesting an upturn underway that could call off a head and shoulders top. RSI levelling off just below 50 suggests momentum may be going neutral. Initial resistance near 2,060 on a bounce near the 50-day average with support rising toward 2,048.

UK 100 continues to attract support above 6,060 trading between 6,120 and 6.150 but it still needs to clear 6,200 to signal an upturn. RSI holding 40 and starting to rise suggests downward pressure levelling off and starting to fade.

Germany 30 continues to struggle below 10,000 trading below its 50-day average in the 9,880 to 9,920 range with channel support down near 9,725. Index below its 50-day average and 50 on the RSI suggest an emerging downtrend.

Commodities

Gold has stabilized near $1,255 above the 50-day average near $1,250 after a punch down to $1,244 last week. A hammer candle suggests bears may have been washed out by that move. RSI stabilizing near 50 suggests momentum shifting into neutral.

Crude Oil WTI is trading between $47.40 and $48.60 near $48.10 a Fibonacci level as it continues to work off an overbought RSI after an attempt at a downward correction was rejected at $46.75 support.

FX

US Dollar Index is holding steady near 95.30 pausing to consolidate a recent breakout over 95.00 and digesting an overbought RSI. Next resistance in place near 96.00 then 96.50.

EURUSD has stabilized near $1.1200 a Fibonacci level with an oversold RSI suggesting potential for a trading bounce with initial resistance near $1.1225 then $1.1330. Next downside support at the 200-day average near $1.1111.

GBPUSD has slipped back under $1.4500 from near $1.4610. A doji candle Thursday indicates last week’s pop ending short of downtrend resistance. Meanwhile, higher lows for the pair indicate and uptrend emerging above support in the $1.4350 to $1.4400 zone. .

NZDUSD continues to stabilize with the pair retesting $0.6700 and the RSI retesting 40 as support levels to indicate a sideways trend emerging with the pair near $0.6765 and upside resistance near $0.6840 a channel top near the 50-day average.

AUDUSD is stabilizing near $0.7220 following a hammer candle Thursday which bounced off $0.7180 suggesting recent downward pressure may be getting exhausted. Still, it needs to retake its 200-day average near $0.7260 to call off a breakdown with next resistance near $0.7220.

USDCNH is hanging around 6.5600 retesting a breakout point as new support and working off an overbought RSI. Next resistance near 6.5800 then 6.6000 with support moving up to 6.5540.

USDSGD is still hanging around $1.3800 consolidating recent gains with next resistance near $1.3885 and support near $1.3785. RSI confirms underlying uptrend continues.

USDJPY is bumping up against 110.55 Fibonacci resistance while building support above its 50-day average near the 110.00 round number. Next upside test on a breakout at a prior high near 111.85. RSI back above 50 indicates momentum turning upward.

EURJPY continues to base build between 123.00 and the 50-day average near 124.60 with next tests on a breakout possible near 125.00 then 126.20. RSI nearing 50 where an upward crossing would confirm an upturn in momentum.

CADJPY is slowly slipping back downward with the RSI under 50 and rolling over while the pair slips away from 84.55 toward 83.90 with next potential support near 82.45 a Fibonacci level.

USDCAD is sitting just above $1.3100 consolidating its recent breakout over $1.3000 after encountering resistance in the $1.3130-$1.3150 area. RSI nearing overbought but confirms upward momentum still growing.


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