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Analysis | Commodity Technical Analysis | Written by HY Markets | Thu Apr 20 17 23:10 ET

GOLD

Spot Gold recovered part of losses of the previous day on Thursday, recovering from correction low at $1274, after pullback was contained by Fibonacci 38.2% retracement of $1243/$1295 upleg. The yellow metal bounced after the biggest one-day drop since Mar 30, after weaker than expected US jobs and manufacturing data released on Thursday, dented the tone of strengthening of US economy. Gold is also eyeing French election on Sunday, which may boost its existing safe haven appeal, built on recent uncertainty on rising geopolitical tensions that triggered strong risk-off mode among the traders.

From technical point of view, overall structure remains firmly bullish, with corrective easing on overbought studies seen preceding fresh upside actions.

Technical studies on lower timeframes are mixed and suggest prolonged consolidation phase. Thursday’s recovery was capped by thin hourly cloud (spanned between $1281 & $1283), break above which would gain fresh bullish momentum for further retracement of $1295/$1274 bear-leg and expose pivots at $1287 (Fibonacci 61.8%) and lower top at $1292.

Conversely, weakness below $1274 and violation of next pivot at $1271 (daily Tenkan-sen) would weaken near-term structure and risk stronger correction.

Support: 1276, 1274, 1275, 1271
Resistance: 1283, 1287, 1292, 1295

WTI CRUDE OIL

WTI oil remained in red on Thursday but managed to hold above Wednesday’s spike low at $50.06, as concerns over rising U.S. oil production offset bullish comments from oil producers on a possible extension to the OPEC-led deal to cut global supply. Oil price moved in and out of positive territory in volatile Thursday’s trading, but settled lower, despite bullish comments from OPEC members Saudi Arabia and Kuwait concerning a possible extension to the OPEC-led deal to cut global supply.

Technical studies remain negatively aligned and keep downside at risk, as price approached cracked Kijun-sen support at $50.40 and see risk of renewed attack at psychological $50.00 support, as the price closed below thickening daily Ichimoku cloud, which is seen as negative signal.

Support: 50.40, 50.00, 49.62, 48.92
Resistance: 51.36, 51.54, 51.84, 51.90

DJIA

Dow Jones bounced on Thursday and made strong bullish close after two days in red. The price found footstep at at 20310 and returned back into thick daily cloud after closing below cloud base on Wednesday, signalling false break lower.

Wall Street was higher on Thursday, led by a sharp rally in the shares of American Express , after the company posted better than expected earnings, as comments of US Treasury secretary Mnuchin on tax reform lifted sentiment.

Fresh rally on Thursday improved Dow’ s near-term sentiment, as Thursday’s rally marks the biggest one-day gains since Mar 1 and rally also cracked significant resistance at 20500 (daily Tenkan-sen). Recovery needs to regain next pivots at 20580 and 20669 (daily Kijun-sen) to expose daily Ichimoku cloud top at 20757 and signal stronger recovery on break.

On the downside, daily cloud base is expected to hold and maintain fresh bullish sentiment.

Support: 20500, 20385, 20310, 20211
Resistance: 20567, 20580, 20669, 20757

FTSE100

FTSE index is holding in narrowing consolidation for the second day, following strong fall on Tuesday, which so far found footstep at 7032. Firm bearish setup on daily technical studies keeps the downside in focus, as strong bearish sentiment remains in play on firm pound.

The price is looking for test of psychological 7000 support, break of which will open way towards next pivotal support at 6969 (Fibonacci 61.8% retracement of larger 6675/7444 rally.

Recovery attempts were limited for now and capped at 7092 (Fibonacci 23.6% of 7285/7032 fall) keeping intact more significant barriers at 7129 (Fibonacci 38.2%) and 7147 (broken 100SMA) which guard upper triggers at 7189/97 (daily Tenkan-sen / Ichimoku cloud base).

Support: 7032, 7024, 7000, 6969
Resistance: 7070, 7092, 7144, 7192

DAX

DAX ended Thursday’s trading positively, after spiking lower to 11962, but repeated probe below 12000 handle was short-lived and contained by rising 55SMA. Index was dragged higher by improved sentiment and Wall St rally and bounced back to broken Fibonacci 61.8% support at 12081, which capped the rally on Thursday.

Daily studies remain weak, but oversold conditions suggest extended correction, as daily indicators are turning up.

We look for recovery extension to 12133 (Fibonacci 38.2% of 12410/11962 pullback) which is expected to ideally cap, as barrier is reinforced by bearish-cross of daily Tenkan-sen / Kijun-sen lines.

Only sustained break above the latter would improve the structure and signal further recovery.

Support: 12026, 11962, 11943, 11878
Resistance: 12081, 12133, 12144, 12220

HY Markets
http://www.hymarkets.com

 

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