Gold is trading at strong resistance and will need a good surge of buyers to push it through, price levels favor sellers for now. Crude oil is hanging out around a pair of support lines, 200-day included, if stocks keep selling off as they look like they could then more problems likely ahead for oil. Global stocks are showing some signs of further deterioration ahead, S&P 500 and DAX looking lower.
- Gold price trading at significant amounts of resistance
- Crude oil bounce off support at risk of failing
- S&P rising wedge broke, DAX looking toward t-line support
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Gold price trading at significant amounts of resistance
Gold has become a tough handle lately with it bouncing around between support (August t-line) and resistance (bottom of wedge, soon t-line off Feb high). The ranging activity in-line with the general trend since the Feb high still favors lower prices at some point. However, until we see a drop below the August trend-line and pair of lows at 1266, the downside will be contained. A drop below 1266 should usher in some momentum for traders to feed on. A break above the top-side trend-line off the descending wedge may spark a bit of buying up to around 1310.
Gold Price Daily Chart (resistance, range)
Check out the Q2 Gold Forecast for the intermediate-term fundamental and technical outlook.
Crude oil bounce off support at risk of failing
On Monday, crude oil sold off with stocks and rebounded sharply from a confluence of support by way of the 200-day and rising slope from earlier this year. The reversal, however, is now at risk of breaking just as stocks did. A drop through the 59.98 low on Monday should have seller regaining control again. If the rising wedge in the S&P 500 continues to keep pressure on stocks then risk-off will help further a bearish trading bias.
Check out the Q2 Crude Oil Forecast for the intermediate-term fundamental and technical outlook.
Crude Oil Daily Chart (watch reversal-day low)
S&P rising wedge broke, DAX looking toward t-line support
As discussed earlier today, the convincing break out of the rising wedge has U.S. stocks on their heels. A decline to the 200-day around 2775, bottom of wedge at 2722 looks to be in the cards.
S&P 500 Daily Chart (broken rising wedge)
Check out the Q2 Equities Forecast for the intermediate-term fundamental and technical outlook.
The DAX was hammered yesterday and on that with U.S. stocks rolling downhill, bounces look like selling opportunities. It looks reasonable to target the rising underside channel line down in the vicinity of 11850/800. This could also have the April 3 gap tested and possibly filled as well down to 11754. It will take some work and time to turn the picture back to the upside
DAX Daily Chart (looking for lower channel line)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX