Dollar Returns to Monthly Low, Crude Oil Rebound May Be Ahead

Talking Points:

• US Dollar Edges Downward to Test March Swing Bottom
• S&P 500 Stalls at Support After Hitting Three-Week Low
• Crude Oil Chart Setup Hints a Recovery is Brewing Ahead

Can’t access to the Dow Jones FXCM US Dollar Index? Try the USD basket on Mirror Trader. **

US DOLLAR TECHNICAL ANALYSIS – Prices edged below support at 10529, the 23.6% Fibonacci expansion, to expose the March 7 low at 10502. This barrier is reinforced by the 38.2% Fib at 10492. A break below the latter level targets the 50% expansion at 10462. Alternatively, a reversal above 10529 opens the door for a test of falling trend line resistance at 10574.

Daily Chart - Created Using FXCM Marketscope 2.0

** The Dow Jones FXCM US Dollar Index and the Mirror Trader USD basket are not the same product.

S&P 500 TECHNICAL ANALYSIS – Prices turned sharply lower, taking out support at the bottom of a rising channel set from mid-February and the 23.6% Fibonacci retracementat 1853.00. Sellers are now testing the 38.2% level at 1831.00, with a push below that aiming for the 50% Fib at 1813.30. Alternatively, a move back above 1853.00 sees channel support-turned-resistance at 1867.70.

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS – Prices are testing resistance at 1385.46, the 50% Fibonacci expansion. A break above this boundary exposes the 61.8% level at 1399.23. Near-term support is at 1371.70, marked by the 38.2% Fib. A reversal below that initially targets the 23.6% Fib at 1354.66, a barrier reinforced by falling trend line resistance-turned-support set from April 2013 (1351.53).

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS – The formation of a Dark Cloud Cover candlestick pattern preceded a turn lower, as expected. The appearance of a Morning Star setup now suggests a rebound is in the cards. Initial resistance is in the 100.73-83 area, marked by the December 27 high and the 23.6% Fibonacci expansion. A break above that aims for the 38.2% level at 102.87. Near-term support is at 97.53, the March 12 low.

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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