Resource markets were attracting interest to finish the week with NZD and AUD climbing within consolidation ranges while gold and WTI continued to bounce out of recent declines. Indices, however remain mixed with significant tops forming.
Asia Pacific indices
Australia 200 continues to bounce around between 5,620 and 5,800 near the 50-day average, recently trading between 5,700 and 5,740. RSI gaining on 50 indicates downward pressure easing, but at the same time a head and shoulders top continues to form.
Hong Kong 50 continues to roll over, with resistance dropping from 26,000 toward 25,800. RSI testing 50 where a breakdown would signal a downturn in momentum. Support possible near 25,560 then 25,495.
Japan 225 is still drifting down from a shooting star candle that signalled a buying climax and failure to breakout over 20,240. A growing negative RSI divergence indicates slowing upward momentum. So far the index is holding above 20,000 near 20,125 but if that fails next support may appear near 19,945.
North American and European Indices
US 30 continues to retreat following the completion of a bearish Evening Star candle pattern earlier this week. Resistance falls toward 21,400 from 21,470 with the index trading near 21,375. RSI falling away from 70 indicates a deepening correction with next potential support near 21,270 a 23% retracement of the previous uptrend.
US SPX 500 has levelled off in the 2,428 to 2,440 range, having dropped back from a recent peak near 2,454. RSI slipping back from 70 indicates upward momentum downshifting into neutral. Next support on a breakdown possible near 2,420.
US NDAQ 100 remains unable to retake 5,800 the extension of a broken uptrend line that has become resistance. Similarly, the RSI appears to be stalling out just above 50. Initial pullback support possible at the 50-day average near 5,700 followed by 5,580 a 23% retracement of the recent uptrend.
UK 100 continues to trend downward with resistance falling toward 7,440 and the index testing 7,400 the neckline of a head and shoulders top. RSI under 50 and falling indicates increasing downward pressure. Next potential support in place near 7,375 then 7,350.
Germany 30 continues to struggle with lower resistance near 12,800 and has dropped back toward 12,730. It remains in an uptrend above 12,670 but if that fails an ascending triangle would fail. Similarly, RSI breaking 50 would signal a downturn with next support near 12,600 and the 50-day average.
Gold continues to climb up out of a rounded bottom. The price held its 200-day average to keep its underlying uptrend intact and now appears to be resuming its upward course. Support has moved up to $1.250 and the price has rallied to test its 50-day average near $1.258 with next potential resistance closer to $1.270. RSI testing 50 where a breakout would confirm an upturn in momentum.
WTI crude oil looks like the recent selloff is over for now with $42.00 support holding. An oversold RSI and positive divergence indicate upward momentum slowing and a bounce possible. Recently trading between $42.40 and $43.10, next potential resistance appears near $43.50 then $44.00.
US Dollar Index is holding steady near 97.00 as it continues to trade in a 96.10 to 97.50 channel. Higher lows are forming an ascending triangle base. RSI sitting on 50 indicates sideways momentum.
EURUSD is bouncing up off of $1.1140 support testing $1.1200 reasserting the primacy of a $1.1120 to $1.1290 sideways range. RSI holding 50 and perking up suggests underlying uptrend intact and accumulation may be resuming.
GBPUSD continues to recover from recent weakness, rallying up from $1.2670 higher support through $1.2700 and on toward $1.2720. RSI indicates downward pressure easing. Next potential resistance near $1.2790 a Fibonacci level and the neckline of a head and shoulders top.
NZDUSD remains under accumulation, bumping up against the top of the $0.7200 to $0.7300 range where it has been consolidating and working off an overbought RSI. Next potential resistance on a breakout possible near $0.7375 and $0.7400.
AUDUSD continues to attract support above $0.7500 and 50 on the RSI, pausing between $0.7535 and $0.7590.Next potential resistance near $0.7625.
USDSGD ran into resistance near $1.3920 and appears to be rolling over with the RSI turning back downward as well and testing 50 support. The pair has dropped back toward $1.3875 with next potential support near $1.3810.
USDJPY is sitting on its 50-day average about 111.25 near the middle of a 110.60 to 112.15 Fibonacci trading range. RSI near 50 confirms sideways momentum.
GBPJPY continues to form an ascending triangle base below 142.00 with support rising from 140.40 toward 141.00. RSI advancing on 50 indicates downward pressure easing and an upturn pending. Next potential resistance on a breakout possible near 143.05 the 50-day average.
EURJPY continues to climb within a 122.50 to 125.80 trading range. Both the pair and the RSI have broken out of short term downtrends, with the pair approaching 124.50. Initial resistance possible near the 125.00 round number.
USDCAD is consolidating its recent drop from the 200—day average near $1.3340 trading well below $1.3300 near $1.3265. RSI under 50 and in a downtrend confirms ongoing distribution with next potential support near $1.3200 then $1.3160.
Disclaimer: CMC Markets is an order execution-only service. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.