Morning Technical Notes – Friday 31 May

Today’s wrap and technical outlook for indices, commodities and currencies

Asia Pacific indices

Australia 200 bounced up off of 4,890. A positive RSI divergence combined with a hammer candle suggests that selling pressure may be close to exhaustion for now. Initial resistance on a bounce appears near 5,000. Further support on a failure near 4,850. 

Japan 225 remains in a downtrend with RSI indicating momentum continues to turn increasingly negative. Could have a bounce today after yesterday’s selloff but gains could be limited to 14,000 resistance. Downside support near 13,500 then 13,115 a 38% retracement.

HongKong 43 remains under distribution, currently testing 22,500 as new resistance following a breakdown with next support near 22,275 then 22,000. RSI under 50 suggests downward momentum building.

India50 continues to hang around 6,100 with next resistance near 6,250 and next support near 5,950.

Singapore 30 is breaking down today. It has taken out uptrend support while RSI has dropped under 50 both bearish signs. Next potential support appears near 3,300 then 3,230. 

US Indices

US30 is steady near the middle of a 15,130-15,530 trading channel. Falling RSI suggests upward momentum slowing.

SPX500 is sitting near 1,650 as it continues to drift lower within a 1,635 to 1,685 trading channel.

UK and European indices 

UK 100 continues to retreat with the broken 6,660 support level emerging as new resistance with next potential support on trend near 6,540.

Germany30 is holding 8,290 Fibonacci support for now but a falling RSI and descending triangle suggest distribution increasing. Next support on a breakdown near 8,125, a 38% retracement of the previous uptrend.

France 40 is sitting near 4,000, having completed a double top near 4,040 but stubbornly refusing to break down. Next support near 3,900 then 3,800 should the selloff deepen.

Italy 40 keeps getting kicked around in the 16,960 to 17,650 zone currently trading in the upper half but drifting lower with initial support near 17,150.

Spain 35 continues to drift downward within a 8,250 to 8,700 trading channel. 

Commodities

Gold is breaking out over $1,400 today while RSI suggests upward momentum accelerating. A move through $1,410 would confirm the start of an upswing with next resistance near $1,420, $1,445, $1,460 and $1,485 on trend.

Silver is picking up with RSI suggesting upward momentum building. It needs to clear and stay above $23.00 to confirm the start of a new upswing with next resistance near $23.40 then $24.80.

Copper continues to hang around $3.30, trading in a $3.25 to $3.35 range with sideways momentum confirmed by flat RSI.

US crude has bounced back from an early selloff toward $93.50 but the RSI breakdown through 50 confirms momentum has turned negative, opening the potential for a retest of the $89.00 to $90.00 support zone with resistance falling toward $94.00.

UK crude has bounced up from $101.20 toward $102.25 but it needs to clear $103.25 in order to call off its current downswing.

Gasoline broke $2.80 and trend support yesterday which may become resistance with next support near $2.70. Next upside resistance near $2.83 then $2.89.

Natural Gas is breaking down today following the storage report, taking out $4.00 which may become resistance with next downside support near $3.85 the $3.65. 

FX

NZDUSD is testing $0.8000 and appears to be completing a double bottom. RSI suggests its due for a trading bounce but upside appears limited with risk of another RBNZ intervention. Resistance near $0.8160 with next support near $0.7900 then $0.7840.

AUDUSD appears to be bottoming for now, rebounding strongly out of a bear trip reversal. RSI has broken out over 30 from oversold territory, a bullish technical signal. Next resistance appears near $0.9720 then $0.9840 with support near $0.9590. 

USDJPY continues to form a descending triangle above 100.60 and appears poised for a retest of its key 100.00 level. RSI trend break suggests momentum turning in JPYs favour. Next support on a breakdown appears near 97.00.

AUDJPY is consolidating in the 97.00 to 99.00 area but falling RSI suggests that appears to be a pause in a broader downtrend with next support closer to 95.00.

EURJPY continues to form a bearish descending triangle above 130.00 with next support on a breakdown near 127.00.

USDSGD has reversed course and started falling after failing to clear $1.2700 resistance. Initial support tests appear near $1.2530 then $1.2440.

About Colin Cieszynski

Colin Cieszynski, has been a Senior Market Analyst with CMC Markets Canadian office since 2007. Colin has provided trading insights to individual and institutional clients for over twenty years both as an analyst/strategist and investment advisor, with additional experience in investment banking and syndication. Colin tracks economic and market trends for Global indices, North American stocks, commodities and currencies utilizing both fundamental and technical analysis techniques. He has completed both the Chartered Financial Analyst and Chartered Market Technician programs.
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One Response to Morning Technical Notes – Friday 31 May

  1. Julius says:

    Thank you. Perfect summery!

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