THE TAKEAWAY: The US Dollar recovered while the S&P 500 put in signs of a pullback ahead but follow-through is questionable while trend-defining barriers remain intact.
S&P 500 – Prices put in a bearish Dark Cloud Cover candlestick pattern below resistance at 1466.10, hinting a move lower is ahead. Initial support lines up at the bottom of a rising channel set from the early June swing low (1429.10), with a break below that exposing the 1400 figure. Alternatively, reversal through resistance clears the way for a challenge of the 1500 mark.
Daily Chart - Created Using FXCM Marketscope 2.0
CRUDE OIL – Prices are testing resistance at the would-be neckline of an inverse Head and Shoulders bottom (92.26), with a break higher implying a measured upside target at 97.72. Support stands at 87.66, the 38.2% Fibonacci retracement. A drop below that targets the 50% level at 83.76.
Daily Chart - Created Using FXCM Marketscope 2.0
GOLD – Prices are testing support in the 1732.33-35.65 area, marked by a horizontal pivot level and the 23.6% Fibonacci retracement. A break downward initially exposes 38.2% Fib at 1693.06. Initial resistance stands at the underside of a previously broken Rising Wedge pattern (now at 1772.92), with a reversal above that targeting 1790.55-1802.80 region.
Daily Chart - Created Using FXCM Marketscope 2.0
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US DOLLAR – Prices put in a bullish Piercing Line candlestick pattern above support at 9835, the 23.6% Fibonacci expansion, hinting a rebound may be a head. Overall positioning favors weakness absent a close above falling channel top resistance at 9922, making any rebound falling short of that corrective. A drop below support exposes the 38.2% retracement at 9765.
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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