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Analysis | Commodity Technical Analysis | Written by HY Markets | Tue Feb 14 17 00:25 ET


Spot gold fell to $1,219.26 a troy ounce this Monday, as risk appetite dominate the scene. The bright metal, however, bounced from the level to close the day around 1,226.50, on physical demand at the bullion market, as Indian jewelers bought to meet the wedding season demand. Also, limiting the slide were higher base-metal prices, on fears of copper shortages amid a strike in one of Chile's largest mine. The daily chart for gold indicates that the upward potential eased, but it's too early to call for a retracement, given that the price remains well above a bullish 20 DMA that remains above the 100 DMA, whilst technical indicators retreat, but remain within positive territory. In the 4 hours chart, the price is below a bearish 20 SMA that holds a few cents above the 50% retracement of the post-US election decline, this last around 1,230.00, while technical indicators have recovered within negative territory, holding below previous daily highs. Renewed selling interest below the mentioned daily low will likely see the commodity approaching the critical 1,200 region this Tuesday, where the latest bullish movement will be at risk of reversing.

Support levels: 1,219.20 1,210.10 1,200.00

Resistance levels: 1,230.00 1,237.10 1,244.70


Crude oil prices edged lower this Monday, with West Texas Intermediate futures ending the day around $52.90 a barrel, down 1.7%. A stronger dollar added to EIA news, indicating that US shale oil production is expected to rise in March by 80,000 barrels per day to 4.87 million barrels per day, in the bearish case for the commodity. Rising US production offset news that the OPEC cut is output by 890,000 barrels per day in January a 93% compliance. The commodity retreated once again from the upper end of its latest range, still lacking direction according to technical readings, as in the daily chart, the price continues hovering around a horizontal 20 DMA, whilst technical indicators head nowhere within neutral territory. In the 4 hours chart, technical indicators have continued retreating from overbought readings, and turned lat after reaching their mid-lines, whilst the price broke below a congestion of flat moving averages that failed to signal a clear upcoming move.

Support levels: 52.60 52.00 51.40

Resistance levels: 53.30 54.10 54.70


Wall Street extended its advance, posting record closes for a third consecutive day amid returning confidence on the US new administration. The "Trump-trade" resumed last week after the US president announced a major upcoming tax reform, expected to be business-friendly. The Dow Jones Industrial Average added 142 points and closed at 20,412.16, while the Nasdaq Composite settled at 5,763.96, up by 0.52%. The S&P gained 12 points or 0.52%, to 2,328.25. Financials led the way higher, with Goldman Sachs up 1.46% and JPMorgan Chase ending the day up by 1.32%. The DJIA traded as high as 20,441 and in the daily chart, the price is far above a now bullish 20 DMA, while technical indicators present strong bullish slopes, and particularly the RSI heads north around 76, with no signs of changing bias any time soon. In the 4 hours chart, the index is far above a strongly bullish 20 SMA, whilst technical indicators are giving signs of upward exhaustion, but remain within extreme overbought levels.

Support levels: 20,378 20,330 20,272

Resistance levels: 20,445 20,490 20,550

FTSE 100

The FTSE 100 closed the day at 7,278.92, up by 20 points or 0.28%, underpinned by an advance in mining-related equities. Despite Pound's strength, a strike in Chile's largest copper mine kept the benchmark afloat. Anglo American gained 4.21%, Rio Tint 3.0% while Glencore added 2.56%, all topping gainersĀ“ list. Capita, on the other hand, was the worst performer, down by 2.38%, followed by Fresnillo that lost 1.99%. In the daily chart, the upward momentum is fading in technical indicators, although they remain within positive territory, whilst the index stands above a bearish 20 DMA, currently at 7,190. In the shorter term and according to the 4 hours chart, the risk is towards the upside, as technical indicators have turned flat near overbought readings, but the benchmark stands above a bullish 20 SMA and not far from the record high posted last January at 7,354.

Support levels: 7,208 7,163 7,128

Resistance levels: 7,275 7,326 7,354


European equities closed marginally higher on Friday, with the German DAX finishing at 11,666.97, up 24 points. Despite staring the day with a strong footing, shares failed to extend the risk-appetite rally triggered by the US president on Thursday, but remained afloat on strong earnings reports released earlier in the week, and positive trade data coming from China. In Germany, banks were among the worst performers, with Commerzbank down 2.37%, leading losers' list, and Deutsche Bank down 1.35%. ThyssenKrupp was the best performer by adding 2.35%, followed by Heidelberg Cement that closed 1.58% higher. Technically, the pair presents a modest upward potential in the daily chart, as itĀ“s just holding at the upper end of its latest range, and a few points above a flat 20 SMA, whilst technical indicator in the mentioned time frame barely aim higher within neutral territory. In the 4 hours chart, the index settled above all of its moving averages, but the 20 and 100 SMAs lack clear directional strength, whilst technical indicators have turned lower within positive territory, limiting chances of a steeper recovery as long as the benchmark is unable to advance beyond 11,720, Friday's high and the immediate resistance.

Support levels: 11,605 11,545 11,498

Resistance levels: 11,720 11,794 11,845

HY Markets


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