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Analysis | Commodity Technical Analysis | Written by HY Markets | Thu Feb 02 17 23:51 ET


Gold rallied on the back of persistent dollar's weakness, but trimmed half of its daily gains ahead of the close, with spot settling around $1,215.85 a troy ounce. The commodity traded as high as 1225.23 this Thursday, underpinned by the negative tone of worldwide stocks, following a clueless FOMC meeting. Adding to the safe-haven upward momentum these days, are US President Trump contentiousĀ“ relationships with countries such as Mexico, Japan and now, Australia. From a technical point of view, spot has advanced above its 100 DMA for the first time since past September, while the 20 DMA is nearing the 100 DMA with a sharp bullish slope, supporting some further gains ahead. In the same chart, the RSI indicator resumed its advance, now around 62, a fresh weekly high. In the 4 hours chart, technical indicators have retreated from overbought readings, maintaining bearish slopes, but within positive territory, whilst the price is above a bullish 20 SMA, indicating that the commodity may correct lower before resuming its advance.

Support levels: 1,211.56 1,204.50 1,196.10

Resistance levels: 1,225.23 1,231.10 1,241.35


West Texas Intermediate crude oil prices surged to a daily high of $54.32 a barrel, but trimmed all of its daily gains ahead of the close and settled at 53.47. The early advance was triggered by mounting tensions between the US and Iran, as the White House put Iran "on notice" after the country conducted a ballistic missile-test launch, but at the end of the day, US rising production weighed more on traders' sentiment. From a technical point of view, US oil maintains the neutral stance seen on previous updates according to the daily chart, as technical indicators remain flat around their mid-lines, while the price is a few cents above an also directionless 20 SMA. In the shorter term, and according to the 4 hours chart, the price is standing above its moving averages that anyway remain all together in a tight range, and with no certain directional strength, whist technical indicators have pulled back from oversold territory, and are currently standing within neutral territory.

Support levels: 53.20 52.65 52.00

Resistance levels: 53.90 54.30 55.10


US major indexes closed pretty much flat, with the DJIA down 6 points at 19,884.91, and the S&P also down by 6 points at 5,636.20. The S&P gained 1 point or 0.06% to settle at 2,280.85. Earnings reports released right after the close were disappointing, with GoPro missing on sales, down 11% after hours, and Amazon plunging also due to missing sales and despite Q4 earnings per share beat estimates. Ongoing uncertainty and upcoming US Nonfarm Payroll report kept investors side-lined this Thursday, ahead of clearer clues about the US economic future. The DJIA daily chart shows that the index isĀ  in a consolidative phase, despite off its record highs around 20,150, still hovering around a horizontal 20 DMA, but far above a bullish 100 SMA, and with technical indicators within neutral territory. In the 4 hours chart, the index is a few points above a bearish 20 SMA but hovering around flat 100 and 200 SMAs, both together around 19,890, while the Momentum indicator heads north within positive territory and the RSI hovers around 48, this last limiting changes of a steeper recovery.

Support levels: 19,844 19,806 19,745

Resistance levels: 19,929 19,975 20,036

FTSE 100

The FTSE 100 gained 33 points to close the day at 7,140.75, underpinned by an advance in the mining sector and a weaker Pound, which plummeted after the BOE disappointed speculative interest waiting for an upcoming rate hike on soaring inflation. Hikma Pharmaceuticals top gainer's list, up by 3.82, followed by consumer health and hygiene products firm Reckitt Benckiser Group which added 4.48%, benefiting from a cheaper Sterling. Capita on the other hand was the worst performer, down by 2.72%. The daily chart for the index shows that it holds below the 20 DMA, whilst technical indicators have lost their bearish strength, but remain within negative territory, indicating that the daily recovery is not enough to revert the soft tone seen since early January. In the 4 hours chart, a modestly bullish tone surged ahead of the close, as the benchmark is above a horizontal 20 SMA, whilst technical indicators head higher within positive territory.

Support levels: 7,104 7,057 7,011

Resistance levels: 7,183 7,241 7,297


The German DAX lost 31 points and closed the day at 11,627.95, with European indexes closing mixed but not far from their daily openings. In the region, financial firms and automakers led the way lower, as investors continued unwinding the so-called "Trump trade." In Germany, Deutsche bank was the worst performer, down by 3.87%, followed by Daimler that shed 294% and Volkswagen which closed 1.29% lower. Infineon Technologies on the other hand was the best performer, up 2.13%. Daily basis, the technical picture remains neutral, with indicators unable to find direction, still stuck around their mid-lines, and the benchmark stuck around a horizontal 20 SMA. Shorter term and according to the 4 hours chart, the index remains below a bearish 20 SMA, whilst technical indicators have turned flat right below their mid-lines, indicating that the risk is towards the downside for the upcoming session.

Support levels: 11,609 11,550 11,000

Resistance levels: 11,711 11,770 11,804

HY Markets


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