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US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

2012-09-25 01:48:00
Ilya Spivak, Head Strategist, APAC
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THE TAKEAWAY: US Dollar technical positioning hints a pullback may be ahead but follow-through from risk trends remains absent as the S&P 500 drifts in a familiar range.

S&P 500 – Prices continue to drift above support at 1453.20, the 14.6% Fibonacci retracement, after testing the top of a rising channel set from early June. A break to the downside targets 1439.80, a Fibonacci confluence point marked by the 50% expansion and 23.6% retracement. Channel resistance is now at 1478.40, a barrier reinforced by the 61.8% expansion at 1480.70. A push above that exposes the 1500 figure and the 76.4% level at 1532.20.

US_Dollar_Pullback_Hinted_as_SP_500_Drifts_in_Familiar_Range_body_Picture_5.png, US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL Prices are testing support at 91.56, the 38.2% Fibonacci retracement, after taking out the bottom of a rising channel carved out since early July. A break downward targets the 50% level at 88.83. The channel bottom – now at 95.08 – has been recast as resistance. A push back above that aims to challenge a falling trend line set from late February (now at 99.31).

US_Dollar_Pullback_Hinted_as_SP_500_Drifts_in_Familiar_Range_body_Picture_6.png, US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD Prices continue to stall after taking out resistance at a falling trend line connecting major swing highs since early November 2011. Near-term resistance is at 1790.55, with a break above that targeting 1802.80. The trend line – now at 1756.93 – has been recast as support. A push back below that boundary sees initial downside barriers at 1725.87 and 1687.84, the 23.6% and 38.2% Fibonacci retracements respectively.

US_Dollar_Pullback_Hinted_as_SP_500_Drifts_in_Familiar_Range_body_Picture_7.png, US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

Daily Chart - Created Using FXCM Marketscope 2.0

US DOLLAR Prices put in a bearish Evening Star candlestick pattern after re-testing a rising trend line set from the September 14 low, hinting a move lower is ahead. Initial support is at 9783, the 23.6% Fibonacci expansion, with a break beneath that exposing the 38.2% expansion at 9738. Trend line resistance is now reinforced by the 38.2%retracement at 9857, with a push above that targeting the 50% barrier at 9893.

US_Dollar_Pullback_Hinted_as_SP_500_Drifts_in_Familiar_Range_body_Picture_8.png, US Dollar Pullback Hinted as S&P 500 Drifts in Familiar Range

4hr 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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