THE TAKEAWAY: The S&P 500 and the US Dollar have returned to challenge trend-defining technical barriers, with behavior here likely to set the tone for the months ahead.
S&P 500 – Prices are testing resistance at 1392.10, a horizontal barrier reinforced by a falling trend line set from late March. Negative RSI divergence argues for a downside scenario. Initial support lines up at 1380.60, with a break below that exposing 1358.40. Alternatively, a push through resistance neutralizes the overall bearish structure and exposes the 1400 figure.
Daily Chart - Created Using FXCM Marketscope 2.0
CRUDE OIL – Prices continue to tread water near the 90.00 figure. Initial support remains in the 87.65-88.32 area, marked by the July 3 closing high and the 14.6% Fibonacci expansion, with a break lower exposing the 23.6% level at 85.37. Near-term resistance stands at 93.21, the July 19 high.
Daily Chart - Created Using FXCM Marketscope 2.0
GOLD – Prices are testing resistance in the 1615.65-35.70 area after taking out falling trend line resistance set from late March, with a break higher initially exposing 1671.49. The trend line, now at the 1596.55, has been recast as the first major layer of near-term support.
Daily Chart - Created Using FXCM Marketscope 2.0
US DOLLAR – Prices are probing lower toward the 10,000 figure – a barrier reinforced by a major rising trend line set from late July – after taking out range support at 10041. A daily close below the latter boundary would make the case for a significant bearish trend change. The 10041 level has been recast as near-term resistance.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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