| INDICES/COMMODITIES | ||
| S&P Futures | 2093 | The choppy sideways consolidation continues, with equities heading lower on Friday – on Greek concerns – again, but leaving the overall picture unchanged, which is likely to remain the case ahead of Wednesday’s FOMC decision, unless there is some resolution, one way or the other, over the EU/Greece impasse. While the S+P remains above the 100 DMA, now at 2083, and the rising trend support at 2072, this may limit any further downside momentum. A break though would head towards 2057 (23.6% of 1813/2133) and then to 2044 (200 DMA) and to 2035 (61.8% of 1974/2133). The topside will again find sellers back above 2100 as it heads towards Friday’s 2110 high. Above here looks doubtful over the next couple of days but further gains would then open the way to the 2133 all time high. In the bigger picture, further gains would open up the way for a run towards the 2165/70 target, where the trend line joining the previous highs will provide some resistance and further out, the longer term upside target would appear to be the 161.8% projection of 666 (Mar ’09) to 1372 (May ’11) from 1073 (Oct ’11) at 2206. Neutral. |
| DJI | 17900 | As with the S+P, the DJI surrendered the previous session’s gains and headed back to touch the support at 17850, before closing at 17900. More choppy trade looks likely ahead of the FOMC. A break of 17850, as is hinted at by the 4 hour charts, would see the Dow head towards the 9 June low at 17690, below which would potentially revisit 17600 and lower. The daily charts are neutral, (although may be in the early stages of turning lower) and it may be that we see another squeeze back towards 18000, above which would run into sellers again as we head back towards 18100. A neutral stance is required but selling rallies looks to be the most likely strategy. |
| ASX SPI | 5526 | The SPI had a tight 5520/5558 range on Friday, capped by the 200 HMA at 5548 and the 200 DMA at 5565. The daily charts are recovering their oversold condition and may want to take a stronger look at this level, above which would then head towards last Thursday’s high at 5583, and beyond, towards 5600. The downside will find minor support at the 100 HMA at 5505, below which would see a run back towards 5480 and to last week’s low at 5424. This area will be strong support (200 WMA: 5430), but with the weeklies pointing lower, I think this is the overall direction that we should be concentrating on, and selling into strength, looking for a run towards the longer term target at 5213 (Jan 2015 low) and then to 5135 (38.2% of 3721/6010). |
| GOLD | 1182 | Gold continues to consolidate near 1180/90 and seems likely to continue to do so, caught for the time being between wanting to go lower, (which it probably will do if the Fed are hawkish on Wednesday and send the dollar higher), and on the other hand, looking to head back towards/above 1200, due to nervousness over the tensions between Greece and its creditors. Overall, I suspect the slow grind lower is going to continue, and back below Friday’s 1176 low, the immediate target is the previous week’s 1162 low, below which would head towards 1150, 1142 (17 March low) and eventually to 1131 (7 Nov low). The topside will again see sellers at 1190/1200, above which it will, once again, find it hard to break back above 1205/10. If wrong, we could see another run above 1210, possibly towards 1225. Doubtful. Selling rallies still seems to be the theme. |
| SILVER | 16.01 | Silver ended up unchanged on Friday after a 15.85/16.06 range. The dailies are still pointing lower, so we could eventually be in for another test of 15.85 and the double bottom at 15.80 (11 June/30 Apr lows), below which would head to the 24 April low at 15.60 and eventually to the 11 March low at 15.29 . The topside will find sellers again at 16.20(200 HMA) ahead of 16.27 (23.6% of 17.74/15.81), and the 100 DMA (16.55). The outlook remains unchanged, and selling rallies would seem to be the plan, with a SL placed tight above 17.00. In the bigger picture, the year-to-date consolidation appears to be reaching maturity. It could be that we see one more short squeeze, which should run out of steam ahead of the May-18 high at 17.79, but I suspect we are heading for a resumption of the long-term downtrend to the March 14.41 low and then to 14.00 (200 Month MA) and eventually on to the major rising trend support at 13.00. This would be confirmed by a break below the Mar-11 low at 15.29 and would suggest that the long term downtrend has resumed. |
| OIL(WTI) | 60.01 | WTI is back at the 60.00 pivot, lower on Friday due to concerns production may rise further, but chopping sideways within its recent broad 57/62 range, leaving the outlook neutral. The 4 hour charts are pointing lower, suggesting an early test of the 200 HMA at 59.70, below which would head back towards 59.00 and possibly towards 58.00. The topside will see sellers again in the 61.00/50 area, above which would potentially revisit 62.50, but at this stage looks unlikely. Ahead of the FOMC meeting, 60.00 may well act as a bit of a magnate. |
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