US Dollar Edging Lower, S&P 500 Rebound Seen as Corrective
THE TAKEAWAY: The US Dollar continues to edge lower resistance while yesterday’s jump in the S&P 500 looks to be corrective within the context of a broader move lower.
US DOLLAR TECHNICAL ANALYSIS– Prices pulled back from resistance at the top of a rising channel set from early February to test 14.6% Fibonacci retracement support at 10367. This barrier is reinforced by the channel bottom (10377). Negative RSI divergence warns of weakness ahead, with a break downward initially exposing the 23.6% level at 10320. Channel top resistance is now at 10483.
Daily Chart - Created Using FXCM Marketscope 2.0
S&P 500 TECHNICAL ANALYSIS – Prices rebounded from support at 1486.90, the 23.6% Fibonacci retracement, to recapture the 1500 figure. Near-term rising trend line support-turned-resistance is at 1533.10. A Bearish Engulfing candlestick pattern at the February 20 top remains valid however, marking the current advance as corrective in the context of a broader bearish bias absent a close above the pattern’s high (1531.60).
Daily Chart - Created Using FXCM Marketscope 2.0
GOLD TECHNICAL ANALYSIS – Prices recoiled from resistance at 1611.83, the 23.6% Fibonacci retracement, cutting short a four-day recovery. Near-term support is at 1590.16, the 14.6% level, with a break below that aiming for the February 21 low at 1555.00. Alternatively, a reversal above resistance aims for the 38.2% retracement at 1646.99.
Daily Chart - Created Using FXCM Marketscope 2.0
CRUDE OIL TECHNICAL ANALYSIS– Prices are retesting support-turned-resistance at 92.80, the 38.2% Fibonacci retracement. A break back above this barrier exposes the 23.6% level at 94.87. Near-term support is at 91.13, the 50.0% Fib, with a drop beneath that targeting the 61.8% retracement at 89.45.
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
New to FX? Watch this Video. For live market updates, visit the Real Time News Feed
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.