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Forex Analysis: US Dollar Chart Setup Warns of Pullback Ahead

By , Currency Strategist
07 January 2013 06:07 GMT

THE TAKEAWAY: US Dollar technical positioning warns a turn lower may be ahead after the currency hit a five-month high against its top counterparts last week.

US DOLLAR TECHNICAL ANALYSIS Prices are testing resistance at 10122, the 61.8%Fibonacci expansion, with a Shooting Star candlestick warning that a turn lower may be ahead. Near term support is at 10082, the 50% level. A reversal back below that exposes the 32.8%expansion at 10044. Alternatively, a break above resistance aims for the 76.4% Fib at 10170.

Forex_Analysis_US_Dollar_Chart_Setup_Warns_of_Pullback_Ahead_body_Picture_4.png, Forex Analysis: US Dollar Chart Setup Warns of Pullback Ahead

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS – Prices launched sharply higher in the aftermath of a deal to avert the fiscal cliff, taking out a falling trend line set from mid-September and exposing resistance at 1466.10. A break above that targets the 1471.60-1474.90 area marked by the October 5 and September 14 swing highs. Initial support is at 1450.10, the December 19 top, with a break below that eyeing the trend line at 1440.40 and a horizontal pivot at 1432.90.

Forex_Analysis_US_Dollar_Chart_Setup_Warns_of_Pullback_Ahead_body_Picture_3.png, Forex Analysis: US Dollar Chart Setup Warns of Pullback Ahead

l Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS Prices reversed lower from resistance at a falling trend line set from late November to test support at the 38.2% Fibonacci expansion (1649.37). A break below this boundary exposes the 50% level at 1635.24. Near-term resistance is at 1666.86, the 23.6% Fib, with turn back above that eyeing the trend line (now at 1685.77) anew.

Forex_Analysis_US_Dollar_Chart_Setup_Warns_of_Pullback_Ahead_body_Picture_2.png, Forex Analysis: US Dollar Chart Setup Warns of Pullback Ahead

Daily Chart - Created Using FXCM Marketscope 2.0

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CRUDE OIL TECHNICAL ANALYSIS Prices put in a Hanging Man candlestick below resistance at 93.25, the 100% Fibonacci expansion, hinting a move lower is ahead. Near-term support is in the 91.23-92.01 area, marked by the 61.8% and 76.4% Fibs respectively. This barrier is reinforced by the formerly broken top of a rising channel top set from early November.A drop below 91.23 exposes the 90.00 figure. Alternatively, a reversal above 93.25 aims for the 123.6% expansion at 94.51.

Forex_Analysis_US_Dollar_Chart_Setup_Warns_of_Pullback_Ahead_body_Picture_1.png, Forex Analysis: US Dollar Chart Setup Warns of Pullback Ahead

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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07 January 2013 06:07 GMT