Forex Analysis: US Dollar Holds Support Despite Sharp S&P 500 Recovery

THE TAKEAWAY: The US Dollar has managed to hold up at chart support despite a sharp S&P 500 rebound that might have been expected to sink the haven currency.

US DOLLAR TECHNICAL ANALYSIS– Prices broke rising trend line support set from the mid-September bottom, exposing a neckline barrier at 9927. A further drop below that exposes the bottom of a Flag formation at 9870. Trend line support-turned-resistance is at 9952, a barrier reinforced by the Flag top. A push above that aims for the 23.6% Fibonacci expansion at 9995.

Forex_Analysis_US_Dollar_Holds_Support_Despite_Sharp_SP_500_Recovery_body_Picture_4.png, Forex Analysis: US Dollar Holds Support Despite Sharp S&P 500 Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS – Prices rebounded from the bottom of a minor rising channel bottom set from late November to challenge resistance at a falling trend line set from the September 14 high (1445.60). This barrier is reinforced by the channel top at 1449.70, with a break above that exposing 1466.10. Alternatively, a drop below channel bottom support (1418.00) aims for 1398.10.

Forex_Analysis_US_Dollar_Holds_Support_Despite_Sharp_SP_500_Recovery_body_Picture_3.png, Forex Analysis: US Dollar Holds Support Despite Sharp S&P 500 Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS – Prices plunged through supports at 1692.41 and 1677.84, the 50% and 61.8% Fibonacci expansions respectively. Sellers now aim to challenge the 76.4% level at 1659.90, with a push below that targeting the 100% mark at 1630.97. The 1677.84 level has been recast as near-term resistance, with a push back above that aiming for 1692.41 anew.

Forex_Analysis_US_Dollar_Holds_Support_Despite_Sharp_SP_500_Recovery_body_Picture_2.png, Forex Analysis: US Dollar Holds Support Despite Sharp S&P 500 Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

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CRUDE OIL TECHNICAL ANALYSIS– Prices bounced from support at 85.61, the 50% Fibonacci expansion, to approach range top resistance at 89.19. A push above that initially aims for the December 3 high at 90.31. Alternatively, a break below that exposes the 61.8% Fib at 84.50.

Forex_Analysis_US_Dollar_Holds_Support_Despite_Sharp_SP_500_Recovery_body_Picture_1.png, Forex Analysis: US Dollar Holds Support Despite Sharp S&P 500 Recovery

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

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