THE TAKEAWAY: The S&P 500 is on its way to test the 2011 yearly high as US Dollar technical positioning warns the safe-haven currency may see further near-term losses.
S&P 500 – Prices overcame resistance at 1358.60, the July 2011 high, and now aim for the May 2011 top at 1376.10. Negative RSI divergence hints at ebbing bullish momentum and warns a reversal may be imminent. The 1358.60 level has been recast as near-term support.
Daily Chart - Created Using FXCM Marketscope 2.0
CRUDE OIL – Prices broke through resistance at 103.66, the January 4 high, exposing the next upside barrier at the 123.6% Fibonacci extension (105.61). Continued upward momentum above here targets 106.81, the 138.2% Fib. The 103.66 level has been recast as near-term support.
Daily Chart - Created Using FXCM Marketscope 2.0
GOLD – Prices are testing through the top of a Descending Triangle set from early February, with a break higher invalidating the formation’s bearish implications and exposing initial resistance levels at 1746.10 and 1763.00. Near-term support lines up at 1714.05. A break below that targets 1677.05.
Daily Chart - Created Using FXCM Marketscope 2.0
US DOLLAR – Prices are capped by the 50% Fibonacci retracement level at 9863, with negative RSI divergence warning of weakness ahead. Initial support lines up at 9788, the 23.6% Fib expansion, with a break below that targeting the 38.2% level at 9732.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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