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Analysis | Commodity Technical Analysis | Written by HY Markets | Fri Aug 04 17 04:14 ET

GOLD

Spot gold plunged at the beginning of the session, later bouncing from a weekly low of 1,257.00 to settle at $1,268.25 a troy ounce. Demand for high yielding assets was behind the early decline, but as sentiment deteriorated though the day, the safe-haven commodity recovered its shine. Adding to the recovery were worse-than-expected US macroeconomic releases, which sent the greenback lower against most of its major rivals. Spot's daily chart shows that the early decline reverted from near a still flat 100 DMA, whilst the 20 DMA accelerated its advance below the largest, and is about to cross it, usually a sign of trend continuation. The Momentum indicator in the mentioned chart keeps easing within positive territory, but the RSI remains firm around 65, limiting chances of a downward move. In the shorter term and according to the 4 hours chart, gold is now neutral, as the price is hovering around a horizontal 20 SMA, whilst technical indicators lack directional strength, now stuck around their mid-lines.

Support levels: 1,263.65 1,257.30 1,246.40

Resistance levels: 1,274.05 1,283.30 1,290.10

WTI CRUDE OIL

West Texas Intermediate crude futures retreated from an early advance towards 50.00 and closed the day in the red around $49.20 a barrel. Investor choose to take profits out after the US benchmark reached the key threshold, as oversupply concerns still weighed. According to a Reuters┬┤ report, OPEC's crude oil exports rose to a record highs in July, driven by soaring exports from the group's African members, adding pressure on oil prices. Technically, the daily chart shows that the price was unable to advance beyond an anyway horizontal 200 DMA, while the 20 DMA kept advancing below the current level and it's about to cross above the 100 DMA, both converging around 47.70. Technical indicators in the mentioned time frame keep retreating within positive territory, not enough to support a bearish extension, but limiting chances of a steeper recovery. Shorter term and according to the 4 hours chart, the commodity looks increasingly bearish, as it settled below a horizontal 20 SMA, while technical indicators turned south within negative territory after failing to surpass their mid-lines.

Support levels: 48.80 48.30 47.70

Resistance levels: 50.20 50.85 51.40

DJIA

US major indexes closed mixed, although not far from their opening levels, with a retracement in the tech sector leading the way lower. Nevertheless, caution prevailed ahead of the release of the US monthly employment report, with the DJIA confined to a tight intraday range and ending higher by 9 points at 22,026.10 its seventh consecutive record close. The Nasdaq Composite settled 22 points lower at 6,340.34, while the S&P shed 5 points, or 0.22%, to 2.472.16. Pfizer was the best performer, adding 1.46%, followed by 3M which gained 1.00%. El du Pont led decliners, down 1.25%. From a technical point of view, the daily chart for the DJIA shows that the index held near its recent highs, maintaining the bullish stance as indicators continue heading higher within overbought levels, albeit with the RSI partially losing upward strength, whilst the index is further above its moving averages, despite the 20 DMA accelerated north. In the 4 hours chart, the technical picture is neutral-to-bullish, as the index held above a bullish 20 SMA, now the immediate support at 21,991, the RSI indicator remains flat around 71, while the Momentum corrected lower within positive territory, now bouncing modestly from its mid-line.

Support levels: 21,991 21,940 21,895

Resistance levels: 22,043 22,090 22,140

FTSE100

The FTSE 100 closed at 7,474.77, up 63 points on the day, as the Pound plunged following the BOE's monetary policy decision, also backed by a recovery of mining-related equities. Next topped winners' list adding 9.67% after raising the lower end of its full-year sales guidance, followed by Randgold Resources which added 3.43&. ConvaTec was the worst performer, down 6.38%, after the company’s first-half operating profit fell to $193.5 million from $209 million a year ago. The index advanced within its weekly range, paring gains right below Monday's top of 7,515, with a modestly positive tone in its daily chart, as the index settled above its moving averages, with the 20 DMA gaining some bullish traction, as technical indicators bounced from their mid-lines, with limited upward strength. In the 4 hours chart, technical indicators are barely retreating from their daily highs, sill near overbought levels, whilst the index settled above all of its moving averages that anyway continue lacking directional strength.

Support levels: 7,440 7,392 7,340

Resistance levels: 7,485 7,520 7,551

DAX

European equities closed mixed this Thursday, with the German DAX shedding 26 points or 0.22% to end at 12,154.72. Soft data released in Asia weighed on local shares, denting market's sentiment in the following sessions. The banking sector was the best performer in Germany, with Commerzbank leading the way higher by adding 2.51%, while Deutsche Bank closed 0.56% higher. The technology sector changed course and fell, with Siemens leading decliners, down 2.98%, followed by Volkswagen which closed 1.09% lower. From a technical point of view, the daily chart shows that the index remained in the lower end of its weekly range, and at risk of falling further, as technical indicators keep heading south near oversold territory, whilst the 20 DMA has extended its advance above the current level and below the 100 DMA. In the 4 hours chart, the technical stance is neutral-to-bearish, as the index remained capped below its 20 SMA, whilst the Momentum indicator heads nowhere around its 100 level and the RSI indicator gains downward strength, currently around 41.

Support levels: 12,121 12,084 12,039

Resistance levels: 12,191 12,245 12,295

HY Markets
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