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Analysis | Commodity Technical Analysis | Written by HY Markets | Wed May 17 17 04:24 ET

GOLD

Stop gold settled at $1,237.50 a troy ounce, extending its weekly advance by a few cents as the greenback remains in sell mode, while market's mood remains high. The bright metal has posted a limited recovery ever since bottoming at a two-month low of 1,214.24 earlier this month, as odds for a US rate hike next June limit chances of a steeper advance. From a technical point of view, the pair has pared its advance right below a horizontal 100 DMA, but advanced above its 200 DMA for the first time in over a week, while it remains below a strongly bearish 20 DMA, this last at 1,243.30. Technical indicators in the mentioned time frame remain within negative territory, with the RSI heading higher around 45, but the Momentum showing no certain directional strength. In the 4 hours chart, a positive tone prevails, with the price above a bullish 20 SMA, and indicators presenting a neutral-to-bullish stance within positive territory.

Support levels: 1,233.20 1.226.60 1,214.25

Resistance levels: 1,243.30 1,251.30 1,262.10

WTI CRUDE OIL

Crude oil prices retreated this Tuesday, with West Texas Intermediate crude futures settling at $48.63 a troy ounce. Despite broad dollar's weakness, the commodity was unable to extend its upward momentum, as investors turned cautious ahead of the weekly US stockpiles release. Inventories are expected to have decreased by around 2.3 million barrels in the week ended May 12th. The API report to be released at the beginning of the Asian session, may hint what the EIA will bring later on the day. From a technical point of view, the daily cart shows that the price remained within the higher end of Monday's range and above a modestly bearish 20 DMA, but also that technical indicators have lost their upward momentum and turned flat within neutral territory. Shorter term and according to the 4 hours chart, technical indicators have eased within positive territory, with the price resting a few cents above a bullish 20 SMA, providing an immediate support at 48.45.

Support levels: 48.45 47.30 46.60

Resistance levels: 48.95 49.60 50.10

DJIA

Wall Street closed mixed, with the Nasdaq Composite ending the day 20 points higher at 6,169.87, but the Dow and the S&P trimming all of its daily gains ahead of the close, both ending the day with marginal losses. The DJIA shed 2 points, to 20,979.68, while the S&P lost 0.07% and ended at 2,400.67. Techs were the best performers, with Microsoft leading winners' list within the Dow, up 2.01% and followed by IBM which added 1.43%. UnitedHealth Group was the worst performer, down 1.99% while Nike shed 1.84%. From a technical point of view, the index maintains a neutral stance, as investors stand clueless on political woes, although confident on a brighter future. In the daily chart, technical indicators stand pat around their mid-lines, whilst the index barely ended a couple of points above a modestly bullish 20 DMA. In the 4 hours chart, the technical picture is neutral-to-bullish as indicators hold flat within positive territory, whilst intraday declines were contained by a bullish 100 SMA, currently at 20,945.

Support levels: 20,865 20,822 20,797

Resistance levels: 20,900 20,941 20,977

FTSE100

The FTSE 100 rallied to fresh record highs, adding 68 points at the end of the day to settle at 7,522.03. Advancing mining-related equities alongside with a soft Pound, supported once again the advance in the Footsie. Vodafone was the best performer after the telecoms group raised its forecasts for profits for the coming year, posting a 3.96% intraday gain. Fresnillo followed through with a 2.90% advance, whilst Rio Tinto added 2.68%. Hargreaves Lansdown plunged 8.50% leading losers list after competitor Vanguard announced plans to launch an online service to sell its funds directly to UK investors, spurring concerns over an upcoming price war. EasyJet followed, down by 7.25% after reporting a £212 million loss for the first half of its financial year. The index holds around the mentioned close early Asia, and the daily chart shows that the RSI indicator maintains its upward slope at 71, while the Momentum indicator resumed its advance after a modest downward correction, indicating that further gains are likely, despite a downward corrective move can't be dismissed. In the 4 hours chart, technical indicators are also biased higher within extreme overbought territory, as the 20 SMA keeps advancing far above the larger ones and below the current level.

Support levels: 7,508 7,465 7,410

Resistance levels: 7,535 7,570 7,600

DAX

European equities closed mixed around their opening levels, with the German DAX pretty much unchanged, down 2 points to 12,979.53, weighed by a decline in the automotive sector. In Germany, confidence remained strong, but the positive sentiment has grown at a slower-than-expected pace, denting local sentiment, alongside with a non-motivating EU Q1 GDP. Only nine components managed to advance, with ThyssenKrupp adding 4.03%, followed by Deutsche Telekom that gained 1.08%. The worst performer was Linde, down 1.22% followed by BASF that closed -1.09%. The index closed the day with a small doji, having held within the upper end of Monday's range, overall retaining the positive stance, as in the daily chart, the RSI indicator continues consolidating in overbought levels, whilst the Momentum indicator turned flat above its 100 line as moving averages keep advancing well below the current level. In the 4 hours chart, a modest positive tone is present, as indicators bounced from their mid-lines, while the index holds above its 20 SMA.

Support levels: 12,801 12,755 12,718

Resistance levels: 12,839 12,870 12,920

HY Markets
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