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THE TAKEAWAY: The US Dollar soared to fresh 18-month highs as the S&P 500 probed back below the 1300 figure but relative strength studies continue to warn of topping.

S&P 500 – Prices are testing below support at 1306.50, the 23.6% Fibonacci expansion, to challenge the 1288.00-1292.90 area marked by the October 27 high and the 38.2% level. A break lower here exposes the 50% Fib at 1273.40. For now, near-term resistance remains at 1335.90, the May 29 session high.

Dollar_Sets_Fresh_18-Month_High_as_SP_500_Probes_Below_1300_Again_body_Picture_5.png, Dollar Sets Fresh 18-Month High as S&P 500 Probes Below 1300 Again

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL Unchanged from yesterday: “Prices broke through support in the 90.14-88.54 region marked by the early September swing top and the 61.8% Fibonacci retracement. Sellers now aim to challenge the 76.4% level at 83.34. The 90.14-88.54 area has been recast as near-term resistance.”

Dollar_Sets_Fresh_18-Month_High_as_SP_500_Probes_Below_1300_Again_body_Picture_6.png, Dollar Sets Fresh 18-Month High as S&P 500 Probes Below 1300 Again

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD Prices continue to consolidate above support in the 1522.50-1532.45 area. The outlines of a Descending Triangle are beginning to emerge, hinting at forthcoming bearish continuation. Confirmation on a break below support would expose a measured downside objective at 1445.95. Near-term trend line resistance lines up at 1596.90 and 1584.82. A break above the latter level exposes the 1600/oz figure.

Dollar_Sets_Fresh_18-Month_High_as_SP_500_Probes_Below_1300_Again_body_Picture_7.png, Dollar Sets Fresh 18-Month High as S&P 500 Probes Below 1300 Again

Daily Chart - Created Using FXCM Marketscope 2.0

US DOLLAR Prices took out resistance at 10220, the 61.8% Fibonacci expansion level, exposing the 76.4% barrier at 10316 as the next upside objective. Negative RSI divergence warns of waning bullish momentum however, hinting a pullback may be brewing. The 10220 level has been recast as near-term support, with a break below that exposing the 10134-43 area.

Dollar_Sets_Fresh_18-Month_High_as_SP_500_Probes_Below_1300_Again_body_Picture_8.png, Dollar Sets Fresh 18-Month High as S&P 500 Probes Below 1300 Again

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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