The US Dollar is cautiously building higher after a test of trend-defining support as S&P 500 positioning continues to warn of a looming reversal downward.
THE TAKEAWAY: The US Dollar is cautiously building higher after a test of trend-defining support as S&P 500 positioning continues to warn of a looming reversal downward.
S&P 500 – Prices put in a Shooting Star candlestick below the critical 1415.10-24.90 congestion region marked by the late March and early May swing tops, warning of ebbing bullish conviction and hinting a pullback may be ahead. Initial support lines up at 1392.10, with a break below that exposing minor support at 1376.10 and a larger level at 1363.90.
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Daily Chart – Created Using FXCM Marketscope 2.0
CRUDE OIL – Prices continue to stall at resistance in the 93.21-90 area marked by the July 19 high and the 50% Fibonacci retracement. Near-term support remains at the psychologically significant 90.00 figure, a barrier is reinforced by the 38.2% retracement at 89.87. A break below the latter level exposes a rising trend line set from early July, now at 88.81. Alternatively, a push above resistance initially targets the 61.8% Fib at 97.82.
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Daily Chart – Created Using FXCM Marketscope 2.0
GOLD – Prices continue to drift below resistance in the 1620.45-35.70 congestion area. Near-term support remains at a rising trend line support set from late June, now at 1596.24. A break below this boundary exposes a longer-term trend line established from the May 16 bottom, currently at 1576.02. Alternatively, a push above resistance initially targets 1677.79, the May 1 swing high.
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Daily Chart – Created Using FXCM Marketscope 2.0
US DOLLAR – Prices are edging higher from support marked by a rising trend line established from late July 2011 (10005) and the 76.4% Fibonacci expansion (9995) to test above resistance is at 10038, the intersection of the 61.8% Fib and a falling trend line set from the July 12 high. A break higher initially targets 10096, the August 2 high. Alternatively, a reversal below support exposes the 100% expansion at 9925.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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This article (US Dollar Probes as S&P 500 Chart Setup Warns of Looming Reversal) was originally developed by and is property of American Banking News. Checkout American Banking News for up-to-date banking news and peer to peer lending news.