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Analysis | Commodity Technical Analysis | Written by HY Markets | Tue Feb 14 17 23:54 ET


An early advance in gold prices was quickly reversed post-Yellen, with the commodity closing the day marginally higher at $1,228.50 a troy ounce. Risk aversion dominated the Asian session, with most local share markets closing in the red, amid Trump's security advisor resignation. Slackened physical demand from retailers, weighed on the commodity, but it was increasing speculation of an upcoming US rate hike this March what sent the bright metal lower. Technically, the commodity maintains the positive tone seen on previous updates, as the price remained above a bullish 20 DMA, whilst technical indicators turned flat well above their mid-lines, paring the downward correction from overbought conditions seen at the beginning of the week. In the shorter term, and according to the 4 hours chart, technical indicators are hovering around their mid-lines, whilst the price struggles around a bearish 20 SMA. A major Fibonacci resistance stands at 1,230.00, with an upward acceleration beyond it exposing this month high of 1,244.42.

Support levels: 1,221.80 1,210.10 1,200.00

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


Crude oil prices made little progress this Tuesday, with West Texas Intermediate futures settling at $53.16 a barrel, ahead of US stockpiles reports. Crude advanced at the beginning of the day up to 53.70, but eased on the back of dollar's strength, still trapped between lingering concerns about rising US production and OPEC's compliance with its commitment to cut output. Upcoming US data could trigger some sharp moves either side of the board, particularly if stockpiles present another large build. From a technical point of view, the commodity presents a neutral stance in the daily chart, moving back and forth around a horizontal 20 DMA, and with technical indicators heading nowhere around their mid-lines. Shorter term, the 4 hours chart shows that the price remains stuck within a congestion of moving averages, but that technical indicators are entering bearish territory, indicating that the commodity may fall, particularly on a break below 52.60, the immediate support.

Support levels: 52.60 52.00 51.40

Resistance levels: 53.70 54.40 55.20


US indexes closed at record highs for a fourth consecutive session, with the DJIA reaching a new milestone right ahead of the close, settling at 20,504.27, up by 92 points or 0.45%. The Nasdaq Composite added 18 points and closed at 5,782.57, while the S&P gained 0.40%, to 2,337.58. The banking sectors led the way higher on hopes US President Trump will cut corporate taxes, with  JP Morgan Chase leading winners' list within the Dow, up by 1.71%, and Goldman Sachs up 1.34%, closing at an all-time high. Apple also closed at an all-time high, up daily basis by 1.28%. The DJIA presents a strong bullish tone in the daily chart, as technical indicators keep heading north, although the RSI stands at 79, indicating extreme overbought conditions. Back in December, the indicator reached 86 before correcting lower, which means that current reading is hardly a sign of upward exhaustion. In the 4 hours chart, the index is far above its moving averages, with the 20 SMA heading sharply lower around 20,320, reflecting the buying fever around US equities, whilst technical indicators also head north in extreme overbought territory, with no aims to changing course. 

Support levels: 20,489 20,432 20,385

Resistance levels: 20,550 20,600 20,650

FTSE 100

The FTSE 100 lost 10 points this Tuesday, closing the day at 7,268.58, despite a strong earnings report from TUI, as the travel firm added 5.18%, after the company reported that its first-quarter losses had narrowed. Royal Bank of Scotland was the best performer, up 5.29% as the banking sector benefited from improving sentiment, while Rolls Royce Holding topped losers' list, down 3.0% after reporting a pre-tax loss of £4.6bn. The index recovered some ground in after-hours trading, maintaining its positive tone in the daily chart, as it's still holding well above its moving averages, while technical indicators continue consolidating within positive territory. Shorter term, the 4 hours chart shows that the index remains above a bullish 20 SMA, but technical indicators are heading marginally lower, still within positive territory. The Footsie needs to break above 7,298, Monday's high to gather some upward strength, and advance up to 7,354, the record high posted last January.

Support levels: 7254 7,208 7,163

Resistance levels: 7,298 7,354 7,390


European equities closed mixed, but not far from their daily opening levels, with the German DAX down 2 points to 11,771.81, on poor local data, as GDP and ZEW sentiment survey disappointed, and a persistent cautious mood ahead of FED's Yellen testimony. Banks and automakers were the best performers, with Deutsche Bank up 1.77% and Commerzbank adding 1.76%. Volkswagen added 0.94%, but only eight out of thirty components closed in the green. In the daily chart, the index stands at the lower end of its weekly range, still above its 20 DMA and far above a bullish 100 DMA, but technical indicators continue to lack enough strength to confirm an upward extension, with the Momentum still stuck around 100 and the RSI flat around 62. In the 4 hours chart, technical indicators are barely retreating from overbought readings, whilst the 20 SMA maintains its bullish slope above the 100 SMA, both over 100 points below the current level.

Support levels: 11,745 11,694 11,640

Resistance levels: 11,815 11,854 11,891

HY Markets


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