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Analysis | Commodity Technical Analysis | Written by HY Markets | Tue Jan 03 17 00:12 ET


The ongoing holiday kept the COMEX division of the New York Mercantile Exchange closed this Monday, the primary market for trading metals such as gold, silver, copper and aluminum, with spot gold latest close registered last Friday at $1,150.25 a troy ounce, its highest in two weeks. Activity will resume partially in Asia, as Japan and New Zealand will extend their holidays for one more day, but if the rest of the local share markets advance, gold will likely be in trouble, particularly considering latest dollar's strength. From a technical point of view, the latest recovery stalled short of the 23.6% retracement of the November/December slide at 1,173.10, the level to surpass to deny lower lows beyond December's one of 1,122.62. In the daily chart, indicators have turned back south after failing to overcome their mid-lines, whilst the price stands above a strongly bearish 20 SMA, currently at 1,145.60, the immediate support. In the 4 hours chart, the 20 SMA has advanced above the 100 SMA, both below the current level, while technical indicators have retreated from overbought readings, and head towards their mid-lines within positive territory. A break below the mentioned support should put the metal back in the bearish track, towards 1,122.62, December monthly low.

Support levels: 1,145.60 1,136.45 1,122.60
Resistance levels: 1,159.50 1,173.10 1,182.90


There was no oil trading around oil this Monday with most major markets closed, and WTI latest close registered on Friday at $53.88 a barrel. The commodity was buoyant ever since the OPEC announced an agreement, which included some non-OPEC oil producers country, to trim output by around 1.8 million barrels per day starting this January. WTI rallied up to $55.42 after the official announcement early December, entering afterwards a consolidative stage with buyers aligned around 52.00. Investors are reluctant to push the price higher as the OPEC has a long record of not fulfilling its promises, but seems confidence among investors remains high anyway. Technically, the daily chat shows that the price holds above a bullish 20 SMA, although technical indicators lack directional strength, with the Momentum flat around 100 and the RSI consolidating around 61. In the 4 hours chart, the technical stance is neutral, given that the price has spent the last two days consolidating around a modestly bullish 20 SMA, while technical indicators hovered around their mid-lines.

Support levels: 53.30 52.70 52.10
Resistance levels: 54.40 54.90 55.45


There was no activity in Wall Street this Monday, with most major markets closed around the world. The Dow Jones Industrial Average settled last Friday at 19,762.60, falling for a third consecutive day after trading just 24 points shy of the 20,000 threshold in the last week of December. Dollar's gains at the beginning of the week suggest that confidence in the US remains strong, and therefore, the benchmark may resume its advance this Tuesday, particularly if its overseas partners raise during the upcoming sessions. Technically, the daily chart for the DJIA shows that the benchmark closed last Friday below a bullish 20 DMA, that the Momentum indicator heads sharply lower below the 100 level, while the RSI indicator heads north around 58, supporting further slides on a break below 19,715, Friday's low and the immediate support. In the 4 hours chart, the index has broken below the 20 and 100 SMAs both converging in the 19,840 region, offering a strong intraday resistance, whilst technical indicators have bounced modestly from oversold readings, but remains below previous daily highs, indicating limited buying interest ahead.

Support levels: 19,715 19,688 19,627
Resistance levels: 19,782 19,845 19,890

FTSE 100

The FTSE 100 may open higher this Tuesday, and extend its rally to fresh all-time highs, as the Pound weakened this Monday whilst local banks remained closed. The benchmark ended at 7,142.83 on Friday, pulling modestly lower in electronic trading. The Footsie has rallied over 14% during 2016, and the bullish potential remains strong, as the depreciation of the local currency benefited most of the FTSE 100 companies that made profits offshore. Technically, the daily chart presents a bullish stance, with the benchmark advancing further above its moving averages, and technical indicators heading north within positive territory. In the same chart, the upward momentum is limited, but mode due to thin volume than the absence of demand. Shorter term, and according to the 4 hours chart, the index continues to find support on pullbacks towards a bullish 20 SMA, the Momentum indicator holds flat around its 100 level, while the RSI indicator heads north around 69, favoring a bullish extension once the market returns in full mode next Tuesday.

Support levels: 7,089 7,054 7,010
Resistance levels: 7,134 7,175 7,210


European markets closed with gains in this first of the year, with the German DAX up 117 points or 1.02%, to end at 11,598.33, its highest since August 2015. Strong EU economic data drove shares higher, also helped by news coming from Italy, as local newspapers announced that the troubled Banca Monte dei Paschi di Siena will issue €15 billion of debt this year to help boost confidence and liquidity. Banks were the best performers, and within the DAX Commerzbank led gainers list, adding 2.64%, followed by Volkswagen that rose 3.30%. The index presents a strong upward potential in its daily chart, accelerating further above a sharply bullish 20 SMA, this last around 11,300, while technical indicators resumed their advances. The RSI heads higher around 76, with no signs of changing bias, despite being in extreme overbought territory. In the 4 hours chart, the index advanced beyond a still directionless 20 SMA, whilst technical indicators advanced within positive territory before turning flat on low volume, rather than suggesting upward exhaustion. The index has traded as high as 11,623 the immediate resistance and the level to surpass to confirm further gains for this Tuesday.

Support levels: 11,569 11,512 11,458
Resistance levels: 11,623 11,689 11,743

HY Markets


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