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Analysis | Commodity Technical Analysis | Written by HY Markets | Tue Sep 26 17 04:57 ET

GOLD

Spot gold posted its lowest settlement since August 25th, ending the day at $1,291.30 a troy ounce, weighed by US Federal Reserve latest announcement. The central bank revived hopes for a third rate hike this year, with odds of such move now at 72% from 51% before the event. Risk-related headlines coming from US President Donald Trump weren't enough to boost demand for the metal, as he said that "North Korea's nuclear weapons and missile development is a grave threat to peace and security in our world and it is unacceptable that others financially support this criminal, rogue regime," when signing an executive order to further isolate the country. In the daily chart the bearish momentum remains strong, as technical indicators keep heading sharply lower within bearish territory, whilst the price moved further below its 20 SMA, which gains bearish traction far above the current level. Shorter term, and according to the 4 hours chart, the risk is also steady towards the downside, with the 20 SMA crossing below the 200 SMA, both around 1,305.00, and technical indicators holding flat well into bearish territory, with no signs of changing course.

Support levels: 1,288.10 1,280.45 1,273.45

Resistance levels: 1,296.00 1,304.00 1,311.60

WTI CRUDE OIL

West Texas Intermediate crude futures closed Thursday little changed at $50.64 a barrel, reverting an early slide down to 50.06. The OPEC and non-OPEC producers who agreed an output cut late last year, are scheduled to meet this Friday in Vienna to discuss the market impact of their agreement, and the progress achieved so far. Any mention on an extension of their deal beyond its current end, at March 2018, may boost the black gold. In the meantime, the daily chart shows that the price holds near its recent highs, well above still directionless 100 and 200 SMAs, and that technical indicators keep turning lower, but well into positive territory, rather reflecting the ongoing consolidation than suggesting an upcoming decline. In the 4 hours chart and for the short term the commodity retains a positive stance as the price holds within a consolidative range well above a bullish 100 SMA, whilst technical indicators have managed to regain the upside after approaching their mid-lines, still poised to test the 52.00 critical level.

Support levels: 50.20 49.60 49.10

Resistance levels: 51.10 51.55 52.00

DJIA

The Dow Jones Industrial Average put an end to its bullish run, closing the day in the red after nine consecutive advances. The index lost 53 points, or 0.24%, to end at 22,359.23. The S&P shed 7 points and closed at 2,500.60, while the Nasdaq Composite also closed in the red, at 6,422.69 after losing 33 points. Banks remained on the winning side, with Goldman Sachs up 0.81% and JP Morgan gaining 0.53%, both among the best performers. Tech shares led the way lower, with Apple down 1.72%. The daily chart shows that the index held anyway above Wednesday's opening, and far above bullish moving averages, whist the upward Momentum remains strong. The RSI indicator in the mentioned chart has barely retraced, still within overbought readings, all of which limits chances of a steeper decline. Shorter term, and according to the 4 hours chart, the index presents a neutral stance, stuck around a bullish 20 SMA, and with technical indicators have pared their declines before turning flat within positive territory.

Support levels: 22,356 22,321 22,288

Resistance levels: 22,424 22,475 22,500

FTSE100

The FTSE 100 lost 8 points or 0.11% to end the day at 7,263.90, with little to motivate investors and ahead of PM May's Brexit plan announcement this Friday. Most members were down, with Kingfisher being the worst performer, shedding 4.09%, followed by J Sainsbury that lost 4.05%. Only 30 members closed higher, with Johnson Matthey adding 14.6%, after the company revealed a plan for a £200m investment in battery technology as it aims to become a key player in the coming electric car revolution. The index, however, fell in after-hours trading, as the Pound broke higher against its major rivals, heading into the Asian opening some 50 points below the mentioned close. Daily basis, the technical bias remains towards the downside, as indicators resumed their declines within bearish territory and with the Momentum at fresh multi-month lows, whilst the index keeps developing below a bearish 20 DMA. In the 4 hours chart, the index settled around a sharply bearish 20 SMA, whilst the RSI indicator heads lower around 39, also supporting a bearish extension for this Friday.

Support levels: 7,236 7,195 7,150

Resistance levels: 7,271 7,317 7,344

DAX

The German DAX closed at 12,600.03, up 30 points, as persistent strength in back-related equities lifted European equities benchmarks. Local indexes followed the lead of Wall Street, after the US Federal Reserve hawkish stance on tightening for the foreseeable future. Banks could make more money on charging interest when rates rose. Commerzbank led advancers, surging by 2.95%, followed by Deutsche Bank that added 1.78%. ThyssenKrupp, on the other hand, was the worst performer, down 3.49%. The index holds on to gains ahead of Friday's opening, although the daily chart shows that technical indicators are beginning to ease from near overbought readings, indicating that a downward correction is possible, although not yet confirmed. In the shorter term, and according to the 4 hours chart, the index turned neutral-to-bullish, as the Momentum indicator stands flat around its 100 level, whilst the price holds above an also horizontal 100 20 SMA. The RSI indicator in this last time frame, retreats from overbought levels, heading modestly lower around 62.

Support levels: 12,581 12,537 12,489

Resistance levels: 12,630 12,677 12,720

HY Markets
http://www.hymarkets.com

 

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