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S&P 500 Breaks Key Support, US Dollar Holds Below April Top

S&P 500 Breaks Key Support, US Dollar Holds Below April Top

Ilya Spivak, Head Strategist, APAC

THE TAKEAWAY: The S&P 500 cleared major technical support to point the way lower while another strong advance from the US Dollar fell short of overcoming April’s swing top.

S&P 500 – Prices broke through support in the 1339.40-1347.40 area, marked by the 100% Fibonacci expansion and the 38.2% retracement of the rally from the December 19 swing low. Sellers now target the 50% retracement at 1313.00. The 1339.40-1347.40 region is now acting as near-term resistance.

SP_500_Breaks_Key_Support_US_Dollar_Holds_Below_April_Top_body_Picture_5.png, S&P 500 Breaks Key Support, US Dollar Holds Below April Top

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL Prices took out support at 95.41, with sellers now targeting the December 16 low at 92.51. The 95.41 level has been recast as immediate resistance. Importantly, relative strength studies are their most oversold since early August when prices set a major bottom, hinting at least a corrective bounce may be an increasingly likely scenario near-term.

SP_500_Breaks_Key_Support_US_Dollar_Holds_Below_April_Top_body_Picture_6.png, S&P 500 Breaks Key Support, US Dollar Holds Below April Top

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD Prices broke support at 1570.22, the 61.8% Fibonacci expansion level, exposing the measured target of a Triangle chart pattern carved out since late March at 1548.21. The 1570.22 level has been recast as near-term resistance. A break below 1548.21 aims for the December 29 low at 1522.50, followed by the 1500/oz figure.

SP_500_Breaks_Key_Support_US_Dollar_Holds_Below_April_Top_body_Picture_7.png, S&P 500 Breaks Key Support, US Dollar Holds Below April Top

Daily Chart - Created Using FXCM Marketscope 2.0

US DOLLAR Prices are resting resistance at 10047, the April 5 swing high, with a break above that on a daily closing basis targeting the March 15 top at 10097. Near-term support is at 9994, followed by a falling trend line that previously acted as resistance now at 9955.

SP_500_Breaks_Key_Support_US_Dollar_Holds_Below_April_Top_body_Picture_8.png, S&P 500 Breaks Key Support, US Dollar Holds Below April Top

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, send a note with subject line "Distribution List" to ispivak@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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