Morning Technical Notes – Friday 24 May

Today’s wrap and technical outlook for indices, commodities and currencies from CMC’s head of analysis for North America, Colin Cieszynski

Asia Pacific indices 

Australia 200 found support near 5,050 and has rebounded. RSI climbing back above 30 from oversold is a positive technical sign, but it still faces initial potential resistance near 5,120 then 5,150.

Japan 225 fell from a peak near 16,000 and bounced off of 14,000 toward 14,750. Initial resistance appears near 14,850 and 15,000 with support near 14,220 and 14,000. 

HongKong 43 took a big hit yesterday and has been trying to stabilize near 22,620 with more support possible near 22,500. Initial resistance on a bounce may appear near 22,900, a previous support level.

India50 broke down through 6,100 and quickly fell to test near support near 5,975. Overbought RSI has eased and it could bounce but if support fails, 5,800 could be tested. 

US Indices 

US30 followed yesterday’s bearish key reversal with a breakdown through 15,250 overnight with a new downswing confirmed by RSI rolling under 70. Next significant potential support appears near 15,000 then 14,820.

SPX500 continues to fall building on yesterday’s bearish key reversal. RSI broke under 70 from overbought another bearish sigh. Having taken out 1,650, next potential downside support appears near 1,620 then 1,600. 

UK and European indices 

UK 100 continued to fall today but did manage to hold above 6,660 support. RSI falling under 70 from overbought a bearish sign. Next support on a breakdown appears closer to 6,550. 

Germany30 sold off for a second straight day with RSI rolling back under 70 providing another bearish sign on top of the key reversal. Initial support has appears near 8,290 a 23% retracement of the recent rally with next fib support near 8,125 and 7,990. 

France 40 dropped back under 4,000 which may become new resistance and could easily drop back to retest 3,900, a previous breakout point.

Italy 40 was knocked for a loop breaking 17,360 and diving straight for 17,000 before bouncing back a bit. Oversold RSI has eased but this could still be the start of a deeper correction. 

Spain 35 broke down through 8,300 then bounced off of 8,250 but remains vulnerable with RSI falling under 50 to confirm momentum turning negative. Next support near 8,040 with resistance falling toward 8,380. 

Commodities  

Gold held $1,355 shoulder support in yesterday’s pullback and has been taking another run at $1,400 where a neckline breakout would complete a bullish reverse H&S base that has been forming with next resistance near $1,420 then $1,445. 

Silver continues to build support above $22.40 as it tries to build a base for recovery after Monday’s big bear trap reversal. RSI needs to break out of downtrend to confirm start of upswing. Initial resistance near $23.50 then $24.50.

Copper peeked above $3.36 then was pounded back to $3.26 overnight on the disappointing China news. Support has kicked in near $3.25 with more possible near $3.20.

US crude has broken down through $93.25 signalling the start of a new downleg with RSI falling under 50 confirming that momentum has turned negative. Next downside support appears near $92.00 then $90.00.

UK crude broke down through trend support yesterday and has retested $102.25 as new resistance to confirm the start of a new downswing. Next potential support appears closer to the $100.00 level where big psychological and Fibonacci levels converge.

Gasoline remains in an uptrend holding above $2.80 but stuck under $2.84. With RSI back under 50 it remains vulnerable to a retest of $2.77 or $2.70 with resistance on a bounce near $2.89 then $2.95. 

Natural Gas broke out over $4.20 on storage data with next resistance in the $4.40-$4.45 area and next support near $4.00.  

FX  

NZDUSD dipped below $0.8050 then rallied for nearly a penny in a classic bear trap reversal that coincided with a small positive RSI divergence. Initial upside resistance near $0.8160 then $0.8220.

AUDUSD dove below $0.9600 briefly before staging a strong bounce back above $0.9725 in what appears to be a bear trip reversal. That and positive RSI divergence suggests selling exhausted for now. Next resistance near $0.9860.

USDJPY tried to roll over but support has held near 101.80 and remains in an uptrend with next upside resistance near 03.50 and 105.80.

AUDJPY broke down through 99.20 while RSI broke down through 50 to confirm the start of a new downtrend. A retest of the breakdown point is currently underway with the pair having bounced up from 97.00.

EURJPY followed yesterday’s shooting star with a selloff that took it back to retest 130.00 before rebounding toward 132.00 again. Growing RSI divergence suggests upward momentum fading as cracks start to appear. Next support near 127.30.

About Ric Spooner

Over 30 years market experience - professional trader, broker, director
This entry was posted in Forex, Gold, Market, Trading and tagged , , , , , . Bookmark the permalink.

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