US Dollar on the Verge of Trend Reversal, SPX 500 Stuck in Range

Talking Points:

• US Dollar Hovers on the Verge of Trend Change
• S&P 500 Recovers into Familiar Trading Range
• Crude Oil, Gold Prices Continue to Tread Water

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

US DOLLAR TECHNICAL ANALYSIS – Prices looks to be attempting to set a double bottom at 10375, the October 22 close. Confirmation of the upward reversal pattern requires a breach of resistance is at 10455, marked by the top of a falling channel that has guided the benchmark currency downward since the beginning of the year. A daily close above this barrier initially targets horizontal support-turned-resistance at 10495.

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 recovered to challenge resistance in the 1883.80-88.60 area, marked by the 23.6% Fibonacci expansion and the March 7 high. A break above that clears the way for a move into the 1897.40-99.10 region, bracketed by the 38.2% level and the April 4 top. Recent swing lows identify support in the 1850.10-61.90 zone.

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS – Prices are consolidating below resistance in the 1306.72-15.60 area, marked by the top of a descending Triangle chart formation and the 38.2% Fibonacci retracement. A break above that on daily closing basis targets the 50% level at 1330.18. The descending Triangle argues in favor of bearish continuation however (though confirmation is absent for now). Near-term support is at 1277.00, the Triangle bottom.

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS – Prices are retesting rising trend line support-turned-resistance set from mid-March. Initial support is at 101.14, the 23.6% Fibonacci expansion, with a break below that exposing the 38.2% level at 100.23. Alternatively, a move back above the trend line – now at 102.44 – aims for the May 14 high at 102.61.

Daily Chart - Created Using FXCM Marketscope 2.0

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

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