Although the pace of declines subsided Friday, it’s clear that last week represented a bearish turn for markets with a lot of technical damage done that may not be easily undone. Gold continues to climb while WTI remains within striking distance of the $50.00 level.
Asia Pacific indices
Australia 200 finished last week testing its 200-day average near 5,700. The RSI has broken 50 to signal a downturn in momentum. Next potential support in the 5,620 to 5,660 one near a channel bottom.
Hong Kong 50 continues to tumble downward Friday, taking out 27,230 and diving down toward 27,000. RSI testing 50 where a breakdown would confirm a downturn in momentum. Initial resistance falls toward 27,100 a 23% Fibonacci retracement with next potential support near 28,840.
Japan 225 found support at its 200-day average near 19,320 and has bounced back up toward 19,485 a Fibonacci level. With RSI oversold, it could be due for a pause or bounce. Next resistance possible near 19,600 with next support near 19,240 a 50% retracement of the previous uptrend.
North American and European Indices
US 30 has paused to digest the week’s losses, trading near 21,865 between 81,820 and 21,880. The index remains in a downswing below 22,000 but is trading well above 21,755 a 23% retracement of the previous uptrend. RSI falling toward 50 indicates upward momentum weakening and a bigger downturn in momentum pending.
US SPX 500 is consolidating recent losses trading near 2,442 near an uptrend support line. A lot of technical damage has been done this week starting with a bull trap peak and then a breakdown below the 50-day average near 2,450. Next potential downside support near 2,426 then 2410.
US NDAQ 100 found support near 5,755 and bounced back a bit on Friday, climbing up toward 5,830 but still trading below 5,870 where an uptrend recently failed. RSI remains under 50, confirming distribution. The 50-day average near 5,800 remains a key test.
UK 100 remains under pressure with the index falling to test the bottom of its current trading range near 7,290 following from breaking an uptrend support line. Next potential downside support near 7,200. Falling RSI confirms increasing downward pressure.
Germany 30 found support at its 200-day moving average near 11,910, and has bounced back a bit. So far this appears to be an upward correction within a downtrend with the index still below 12,000 and facing additional resistance near 12,090. Next support in place near 11,800 a 38% retracement of its previous uptrend.
Gold continues to climb with the former $1,275 to $1,280 resistance zone becoming higher support and the price advancing on $1,290. Next major potential resistance appears in the $1,296 to $1,300 area. RSI nearing overbought territory but confirms increasing upward momentum for now.
WTI crude oil is sitting above $48.20, the bottom of its current trading range, bouncing back up toward $48.75 following an exploratory dip down toward $47.90. RSI holding 50 suggests the underlying uptrend remains intact for now. Initial rebound resistance possible near $49.10 the 200-day average with next downside support possible near $47.45.
US Dollar Index is starting to roll over again, falling back toward 93.00 while resistance slips toward 93.40. RSI under 50 and rolling over indicates the bears may not be finished yet. Next support possible near 92.55 then 92.35.
EURUSD continues to rebound up off of $1.1705 a Fibonacci level, regaining $1.1800 and advancing on $1.1825. RSI holding 60 confirms the underlying uptrend. Next rebound resistance possible enar $1.1835 then $1.1905.
GBPUSD continues to trade above $1.2970, having completed a common 23% retracement of its previous uptrend, and regained $1.3000. RSI has stabilized near 50 so the recent downswing may be over. Initial resistance near $1.3050.
NZDUSD has established support at a higher low near $0.7250 and bounced back up toward $0.7320, regaining $0.7275 a Fibonacci level in the process. Next rebound tests appear near $0.7345 then $0.7385 which it would need to clear to call off the current downtrend. .
AUDUSD held $0.7825 support and has bounced back up toward $0.7890. RSI holding 50 indicates its underlying uptrend remains intact for now. Initial resistance posi e near $0.7945 then $0.8000 with next support near $0.7775.
USDSGD appears to be resuming its downtrend dropping back under $1.3600 after running into resistance near $1.3650. RSI also indicates the recent trading bounce may be over. Next potential support tests near $1.3540 then $1.3500.
USDJPY remains under distribution with the pair sliding toward 109.10 to confirm its recent breakdown under 110.00. Falling RSI confirms downward momentum accelerating. Next potential support near 108.80 then 108.10.
GBPJPY bounced up off of 141.25 into the 141.80 to 142.00 area where a 50% retracement level and the 200-day average have become lower resistance and a breakout is needed to signal an upturn. Next resistance near 143.30 if successful but next support near 140.40 if it fails.
EURJPY appears to be stabilizing above its 50-day average near 127.550 with the pair bounding back up toward 129.00. It remains in a downtrend, however, unless it can retake 130.00 and 50 on the RSI.
USDCAD has encountered some resistance near $1.2750 and has started to trend downward again, falling toward $12680 in a bearish engulfing day. The RSI has turned back under off near 50 suggesting its broader downtrend remains intact with oversold conditions having eased following a big trading bounce.
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.