Dollar Rally Resumes in Earnest, S&P 500 Finally Overtakes 1700

2013-08-02 02:46:00

Ilya Spivak, Head Strategist, APAC

THE TAKEAWAY: The US Dollar renewed its upward push in earnest after completing a bullish reversal chart pattern. The S&P 500 has finally managed to clear the 1700 figure.

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US DOLLAR TECHNICAL ANALYSIS – Prices advanced as expected after completing a bullish Flag chart pattern. A break above initial resistance at 10820, the 23.6% Fibonacci expansion, has exposed the 38.2% level at 10899. A further push above that targets the 50% Fib at 10963. The 10820 mark has been recast as near-term support.

Forex_Dollar_Rally_Resumes_in_Earnest_SP_500_Finally_Overtakes_1700_body_Picture_5.png, Dollar Rally Resumes in Earnest, S&P 500 Finally Overtakes 1700

Daily Chart - Created Using FXCM Marketscope 2.0

** The Dow Jones FXCM US Dollar Index and the Mirror Trader USD basket are not the same product.

S&P 500 TECHNICAL ANALYSIS – Prices launched higher out of a narrow consolidation range to finally take out the 1700 figure, setting a new record high and extending the rally initiated following the formation of a Piecing Line candlestick pattern. Buyers now stand to challenge the 100% Fibonacci expansion at 1710.90, with a break above that exposing the 123.6% mark at 1746.70. Near-term support is at 1687.40, the May 22 high, followed by the 76.4% Fib at 1675.10.

Forex_Dollar_Rally_Resumes_in_Earnest_SP_500_Finally_Overtakes_1700_body_Picture_6.png, Dollar Rally Resumes in Earnest, S&P 500 Finally Overtakes 1700

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS – Prices broke lower as expected after putting in a Bearish Engulfing candlestick pattern below resistance at the top of a rising channel set from late June. Sellers now aim to challenge the 23.6% Fibonacci expansion at 1273.98, with a break below that exposing the 38.2% level at 1229.97. Channel bottom support-turned-resistance is now at 1329.49.

Forex_Dollar_Rally_Resumes_in_Earnest_SP_500_Finally_Overtakes_1700_body_Picture_7.png, Dollar Rally Resumes in Earnest, S&P 500 Finally Overtakes 1700

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS– Prices advanced as expected after putting in a Bullish Engulfing candlestick pattern. A break above initial resistance at 106.49, the 23.6% Fibonacci expansion, has exposed the 38.2% level at 108.85. A further push above that aims for the 50% Fib at 110.77. The 106.49 mark has been recast as near-term support, with a reversal back beneath that eyeing the July 30 low at 102.66.