THE TAKEAWAY: The US Dollar slipped below key trend line support but S&P 500 positioning continues to favor losses, hinting the greenback may yet find a near-term lifeline.
US DOLLAR TECHNICAL ANALYSIS– Prices broke rising trend line support set from the mid-September bottom, exposing a neckline barrier at 9925. A further drop below that exposes the bottom of a Flag formation at 9881. Near-term resistance is at 9963, the Flag top, with a break above that aiming for the 23.6% Fibonacci expansion at 9995.
Daily Chart - Created Using FXCM Marketscope 2.0
S&P 500 TECHNICAL ANALYSIS – Prices put in a bearish Three Inside Down candlestick pattern at resistance marked by a falling trend line set from the mid-September swing high (now at 1439.40), hinting a move lower is ahead. The appearance of what looks to be a bearish continuation Flag chart formation reinforces the case for a downside scenario. A break below the Flag bottom at 1413.80 confirms the setup, initially exposing 1396.40. Alternatively, a push above 1439.40 targets the next upside hurdle at 1466.10.
Daily Chart - Created Using FXCM Marketscope 2.0
GOLD TECHNICAL ANALYSIS – Prices broke lower after putting in a Bearish Engulfing candlestick pattern, taking out support at a rising trend line set from late June. A move lower is now materializing as expected following a Hanging Man candle completed on a retest of this barrier. Near-term support is at 1692.41, the 50% Fibonacci expansion. A break below that exposes the 61.8% level at 1677.84. Trend line support-turned-resistance is at 1720.45, with a break above that broadly targeting 1752.55 anew.
Daily Chart - Created Using FXCM Marketscope 2.0
Want to learn more about RSI? Watch this Video.
CRUDE OIL TECHNICAL ANALYSIS– Prices moved lower as expected after putting in a Shooting Star candlestick. A bearish continuation Flag chart pattern now appears to be validated with a break through the setup’s lower boundary. Near-term support is at 85.61, the 50% Fibonacci expansion. A break below that exposes the 61.8% Fib at 84.50. Alternatively, a push back above the Flag bottom (87.16) aims for 89.19
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
To be added to Ilya's e-mail distribution list, please CLICK HERE
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.
