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Dollar Pressing Higher as S&P 500 Continues to Stall

By , Currency Strategist
07 February 2013 04:28 GMT

THE TAKEAWAY: US Dollar continues to press higher, touching an 8-month high, while the S&P 500 is stalling near the 1500 mark and warning of ebbing upward momentum.

US DOLLAR TECHNICAL ANALYSIS Prices are testing resistance at 10273, the 100% Fibonacci expansion. A break above that exposes the 123.6% level at 10330. Near-term support is in the 10207-16 area, marked by the 76.4% Fib and rising channel resistance-turned-support. A drop back below that eyes the 61.8% expansion at 10181.

Forex_Analysis_Dollar_Pressing_Higher_as_SP_500_Continues_to_Stall_body_Picture_4.png, Dollar Pressing Higher as S&P 500 Continues to Stall

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS – Prices are hovering above support at 1495.90, the 100% Fibonacci expansion. Negative RSI divergence warns of ebbing bullish momentum, hinting a reversal lower may be ahead. A break downward initially exposes the 1470.30-74.90 area, marked by the September 14 high and the 76.4% Fib. Initial resistance is at 1521.30, the 123.6% expansion, with a push above that aiming for the 138.2% level at 1537.00.

Forex_Analysis_Dollar_Pressing_Higher_as_SP_500_Continues_to_Stall_body_Picture_3.png, Dollar Pressing Higher as S&P 500 Continues to Stall

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS Prices continue to hover above rising trend line support dating back to mid-May (1657.55), with a bullish Morning Star candlestick pattern arguing for an upside bias. Near-term resistance is at 1690.39, the 38.2% Fibonacci retracement, followed by a falling channel top at 1694.42. Alternatively, a drop below support targets the January 4 low at 1625.69 and the 1600/oz figure.

Forex_Analysis_Dollar_Pressing_Higher_as_SP_500_Continues_to_Stall_body_Picture_2.png, Dollar Pressing Higher as S&P 500 Continues to Stall

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS Prices broke lower as expected, taking out the bottom of a Rising Wedge chart formation, after putting in a bearish Dark Cloud Cover candlestick pattern. Initial support is at 95.14, the 23.6% Fibonacci retracement, with a break below that exposing the 38.2% level at 93.24. Near-term resistance is marked by the January 30 high at 98.21.

Forex_Analysis_Dollar_Pressing_Higher_as_SP_500_Continues_to_Stall_body_Picture_1.png, Dollar Pressing Higher as S&P 500 Continues to Stall

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 February 2013 04:28 GMT