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Analysis | Commodity Technical Analysis | Written by HY Markets | Wed Feb 08 17 01:24 ET

GOLD

Gold consolidated its latest gains this Tuesday, setting a fresh high for this 2017 at $1,235.71 a troy ounce. Spot hold within a tight range, just above the 50% retracement of the November/December decline around 1,230.00. The metal was pretty much immune to intraday dollarĀ“s strength, supporting some additional gains ahead. Backing gold's gains was increasing political uncertainty in Europe, adding to that coming from the US. Daily basis, the RSI indicator has lost upward strength within overbought readings, whilst the Momentum indicator diverges lower, nearing its 100 level. The price, however, remains above its 20 and 100 SMAs, with the shortest crossing above the largest, something usually understood as a bullish signal. In the 4 hours chart, technical indicators are retreating modestly from overbought territory, but are far from signaling a bearish extension, whilst the price remains well above bullish moving averages, all of which supports the case for further gains.

Support levels: 1,230.00 1,221.65 1,215.00

Resistance levels: 1,237.30 1,245.20 1,255.05

WTI CRUDE

Crude oil prices fell for a second consecutive day, as speculators rushed to price in a large US stockpiles build, following a private survey and ahead of the release of official data. West Texas Intermediate US futures fell down to $51.81 a barrel and settled right above 52.00, also weighed by weak gasoline prices on decreasing consumption. WTI fell to the lower end of its latest range, and technical readings in the daily chart support additional declines as the price extended below a flat 20 DMA whilst technical indicators have turned bearish maintaining strong bearish slopes. In the shorter term, the 4 hours chart the 20 SMA turned south well above the current level, with the price also below the 100 and 200 SMAs, both still flat around 53.10, whilst technical indicators have lost their bearish strength, but remain near oversold readings and far from suggesting a bottom has been met. The commodity could extend its decline down to the critical 50.00 region on a break below the mentioned daily low.

Support levels: 51.80 51.10 50.40

Resistance levels: 52.40 53.00 53.65

DJIA

Wall Street opened the day with strong gains, resulting in the DJIA posting an all-time high of 20,157, but the negative momentum faded and indexes closed barely up around their daily openings. The Dow Jones Industrial Average closed at 20,089.88, up by 0.19%, while the Nasdaq Composite settled at 5,674.22, up 0.19% a record high. The S&P closed flat at 2,293.08 up by 0.02%. Within the Dow, Boeing was the best performer, up by 1.34%, but losers outnumbered gained, with Chevron topping loser's list, down by 1.46%, followed by Merck & Co that lost 1.33%. In the daily chart, the DJIA maintains its positive tone, as it holds well above its 20 DMA, currently horizontal at 19,932, while technical indicators present tepid bullish slopes within positive territory. In the shorter term and according to the 4 hours chart, technical indicators have pulled back from overbought readings reached earlier in the day, but lost downward strength within positive territory, whilst the 20 SMA maintains a sharp bullish slope, currently around 20,033, indicating a limited downward potential, at least as long as buyers defend the 20,000 level.

Support levels: 20,066 20,010 19,932

Resistance levels: 20,104 20,160 20,200

FTSE 100

The FTSE 100 gained 14 points or 0.20% this Tuesday, closing the day at 7,186.22, undermined by the positive momentum of mining-related equities. Gains were offset by oil's decline that resulted in BP leading losers' list with a loss of 4.49%. The best performers were Randgold Resources, up 8.38% and Fresnillo that added 6.60%, as gold hold on to its recent gains. The late recovery in the Pound, will likely dent sentiment among stocks' traders early Wednesday, particularly if the GBP/USD pair holds above the 1.2500 level. From a technical point of view, the daily chart for the Footsie shows that an intraday advance was rejected again by selling interest around the 20 DMA, whilst technical indicators have turned modestly lower around neutral territory, maintaining the risk towards the downside. In the 4 hours chart, the benchmark remains range bound between horizontal moving averages, whilst technical indicators have turned lower within positive territory, now approaching their mid-lines.

Support levels: 7,163 7,128 7,091

Resistance levels: 7,205 7,258 7,312

DAX

European equities closed with modest gains this Tuesday, as sentiment improved for a short time-spam, with the German DAX closing the day at 11,549.44, up by 39 points. Mining and pharmaceutical equities surged, but bank and energy-related ones fell, leading to the neutral close. Vonovia was the best performer in Germany, up 2.09%, while Commerzbank closed 1.21% and Deutsche shed 0.51%. The benchmark recovered from a daily low of 11,463, but the main support is 11,425, January 17th low. In the daily chart, the index remains below a horizontal 20 SMA, now at 11,637, whilst technical indicators present modest downward slopes within neutral territory, indicating a limited upward potential. In the 4 hours chart, the 20 and 100 SMAs converge at 11,623, whilst technical indicators have recovered from near oversold territory, but turned flat within negative territory, in line with the longer term perspective.

Support levels: 11,518 11,463 11,425

Resistance levels: 11,572 11,630 11,680

HY Markets
http://www.hymarkets.com

 

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