It’s been a big day for technical action in currencies with the USD index breaking out of a cup with handle base and EUR/USD breaking $1.0500 to complete a descending triangle. Trend line breaks are underway in a number of markets including gold while other technical barriers have fallen in JPY, SGD, AUD and NZD with the latter two approaching big round number tests. Meanwhile, WTI crude has come under pressure and US indices have levelled off.
Asia Pacific indices
Australia 200 has levelled off in the 5,760 to 5,780 range, short of 5,830 which it needs to clear to call off a double top. An ascending triangle continues to form above 5,700, which along with RSI holding 50 indicates continuing accumulation.
Japan 225 is struggling with channel resistance near 19,700 again with the index slumping from 19,670 back toward the 19,550 to 19,590 area. RSI testing 60 where a breakout would signal an upturn but a failure would confirm the current sideways trend continues. Next support in a pullback possible near 19,480.
Hong Kong 50 is under pressure, staging a bearish engulfing day as it falls from near 24,130 down toward the 23,630-23,690 area. RSI testing 50 indicates upward momentum nearly gone and a downturn pending with next potential support near 23,500. Initial bounce resistance near 23,750.
North American and European indices
US 30 has dropped back under 21,100 having sliding toward 20,050 having encountered some resistance near 21,175. RSI extremely overbought suggests potential for a correction, perhaps back to retest the 21,000 round number.
US SPX 500 has run into resistance in the 2,390 to 2,400 where a round number and two measured moves cluster. RSI remains highly overbought and could be peaking. The index has started to slide trading near 2,385 with Initial support in a correction possible near the 2,370 breakout point.
US NDAQ 100 has started to drop back after running into resistance near 5,400 recently trading near 5,385. A negative RSI divergence indicates upward momentum slowing and a correction possible with initial support near 5,365 its breakout point then 5,300.
US Small Cap 2000 is sitting just below all-time highs having touched 1,415 Wednesday. Although it’s overbought technically, it's still holding above 1,400 with next support on a breakdown possible near 1,380.
UK 100 is trading between 7,365 and 7,400 consolidating Wednesday’s breakout. Next measured tests possible near 7,420 then 7,520, but a negative RSI divergence and non-confirmation suggests upward momentum may already have peaked.
Germany 30 is consolidating above its 12,000 breakout point trading between 12,040 and 12,100. Next measured resistance possible on trend near 12,300. A growing negative RSI divergence, however, suggests upward momentum slowing.
Gold is breaking down today, taking out uptrend support lines in both the metal price and the RSI to signal a downturn starting. Resistance has dropped from near $1,244 toward $1.234 as the price slides toward $1,230 a Fibonacci level with next support possible near $1,218. RSI diving toward 50 where a break would confirm a downturn.
Crude Oil WTI has been knocked back from near $54.30 back under $53.00 and on toward $52.40 inn what looks like a deepening downswing. The price remains in an uptrend above $52.00 and in a sideways channel above $51.00.
US Dollar Index is breaking out in a big way today, clearing 101.75 to complete of a cup with handle base comprised of a large saucer bottom and then a smaller, higher rounded bottom. Rising RSI confirms upward momentum accelerating. Recently trading near 102.25, next potential resistance appears near 102.45 then 103.00.
EURUSD is breaking down today, falling under $1.0500 to complete a bearish descending triangle and signal the start of a new downleg. RSI under 50 and falling indicates downward pressure increasing.
GBPUSD appears to be trying to stabilize in the $1.2260 to $1.2300 area after a big breakdown that saw it fall from $1.2400 through $1.2360 on Wednesday. RSI under 50 and falling confirms downward momentum accelerating with next potential support near $1.2250 then $1.2200.
NZDUSD is breaking down today, taking out $0.7100 and falling toward $0.7050 with next potential support near the $0.7000 round number. Falling RSI indicates downward pressure increasing.
AUDUSD is breaking down today, taking out $0.7600 and diving toward $0.7550 with next potential support near $0.7520 where the 50 and 200-day averages come together then $0.7500. RSI breaking under 50 confirms momentum turning downward.
USDSGD is breaking out today, clearing $1.4085 and advancing on $1.4140 with next potential resistance near $1.4155 then $1.4200. RSI bumping up against 50 where a breakout would confirm momentum turning back upward.
USDJPY continues to climb, breaking through its 50-day average near 114.35 and advancing on 114.60 as it continues its upswing having broken out of a downtrend and cleared 114.05 a Fibonacci level. RSI back above 50 confirms momentum upturn. Next potential resistance at the 115.00 round number then 115.50.
GBPJPY continues to trade just above 140.00 near the middle of a 138.10 to 142.25 Fibonacci trading range. RSI steady just below 50 indicates neutral to slightly downward momentum as the pair also continues to trend sideways between its 50 and 200-day moving averages.
EURJPY continues to climb up out of a downtrend with support moving up toward 120.00 from its 119.60 breakout point. Initial resistance has emerged near 120.45 followed by 121.00 a Fibonacci level.
USDCAD continues to climb, advancing from $1.3300 toward $1.3400 to test the top of a wide $1.3000 to $1.3400 trading channel. Initial support rises toward $1.3370 from $1.3320. RSI is getting overbought suggesting potential for a pause or correction.
CMC Markets Singapore may provide or make available research analysis or reports prepared or issued by entities within the CMC Markets group of companies, located and regulated under the laws in a foreign jurisdictions, in accordance with regulation 32C of the Financial Advisers Regulations. Where such information is issued or promulgated to a person who is not an accredited investor, expert investor or institutional investor, CMC Markets Singapore accepts legal responsibility for the contents of the analysis or report, to the extent required by law. Recipients of such information who are resident in Singapore may contact CMC Markets Singapore on 1800 559 6000 for any matters arising from or in connection with the information.