Forex: US Dollar Retreats to Chart Support, Gold May Fall Further

Talking Points:

• US Dollar Falls for Third Day, Moves to Retest Trend Line Barrier
• S&P 500 Trading Sideways in a Familiar Range Above 1850.00
• Gold at Risk of Deeper Losses, Crude Oil Still Trying to Advance

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

US DOLLAR TECHNICAL ANALYSIS – Prices Index edged lower for a third consecutive session to retest falling trend line resistance-turned-support set from late January (10528). A break below this barrier initially targets the March 19 low at 10495. Near-term resistance is at 10590, marked by the 23.6% Fibonacci expansion, with a reversal above this barrier targeting the 38.2% level at 10649.

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 continue to consolidate below support-turned-resistance at the bottom of a rising channel set from mid-February (1889.80), a level reinforced by the March 7 high at 1888.60. Near-term support is 1853.00, the 23.6% Fibonacci expansion, with a break below that targeting the 38.2% level at 1831.00.

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS – Prices reversed downward as expected after putting in a Bearish Engulfing candlestick pattern. A break below the 23.6% Fibonacci expansion at 1319.01 has exposed the 38.2% level at 1273.88, with a further move below that eyeing the 50% Fib at 1237.40. Alternatively, a reversal back above 1319.01 aims for trend line support-turned-resistance is now at 1344.85.

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS – Prices are attempting to build upward momentum after putting in a bullish Morning Star candlestick pattern. A break above resistance at 99.57, the 14.6% Fibonacci expansion, exposes the 23.6% level at 100.83. 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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