| INDICES/COMMODITIES | ||
| S&P Futures | 2079 | Global equity markets fell hard on Friday, under pressure from weak commodities and exacerbating concerns over the global economic growth outlook. Copper fell to a six-year low which came on top of weaker than expected data from China and the EU, and does not paint a healthy picture. The S+P headed almost perfectly to the Fibo support at 2068 (61.8% of 2034/2125), by reaching 2069, before a minor bounce to close the week at 2078. With the 4 hour and daily charts seemingly building further downside momentum, we could see a run towards the 200 DMA (2063) and beyond, towards 2055 (76.4%) and potentially towards the very strong support at 2030/35. The topside would seem limited now to the previous strong support – now resistance – at 2090, and selling near here, with a tight stop above 2100 would seem to be a plan. We have been here before though, and it could be that further choppy trade within the recent range is going to continue, at least ahead of the Fed, Wednesday. I think the downside looks more favoured over the next few sessions. |
| DJI | 17528 | Ditto S+P. Having fallen to reach the 17500 support (low 17472) and with both the 4 hour and daily charts pointing lower, further downside momentum looks likely, with support to be seen at 17400 and at the important 17353, 6 July low (38.2% of 15768/18330). A break of this would open the way towards 17280 and possibly to the major rising trend support at 17160. The topside will see sellers at 17620 and then at the 100 DMA at 17715. Any approach to this would seem to be a sell opportunity, with a SL placed, ideally above 17850 although probably lower for more conservative traders. |
| ASX SPI | 5467 | The SPI continued to the downside into the end of the week, not helped by the weak commodity complex, global manufacturing data or the direction of the other global equity markets. Friday’s action saw a move to 5452, meeting the Fibo support (61.8% of 5323/5668) and looking as though it may want to test 5430 (76.4%) and given the weak price action and outlook for commodities, this would seem to be the direction to concentrate on. The short term charts do show some mild bullish divergence though, and a bounce could take the SPI back to the 50% pivot of 5323/5668 at 5495, beyond which (unlikely today) would head towards 5525 and potentially back to the 200 HMA at 5570 and the 200 DMA at 5580. Right now, any move back to 5500 would seem to be a sell, although it could just be rather choppy ahead of Wednesday’s Fed meeting. |
| GOLD | 1099 | Gold managed a bit of a comeback on Friday and after falling to 1077 it bounced impressively, by $25oz, to 1101 before closing the week at 1099. This choppy action seems likely to continue in the near term, but further out things still do not look healthy, and further losses, (possibly not helped by a strengthening dollar/ hawkish Fed), would see Gold head back to Friday’s 1077 low and on to last Monday’s spike low at 1070, beyond which there is not too much to hold it up ahead of 1045 (Feb 2010 low), and 965 (Oct 2009 low), with an eventual target being at 888 (61.8% of 254/1921). Back above 1105/10, the topside will run into strong selling interest on the approach back towards 1130, with 1115/20 likely to be toppish on an intraday basis. Selling rallies at 1110/15 seems to be the plan with a tight SL placed above 1120. |
| SILVER | 14.66 | Silver had another choppy day on Friday, finishing unchanged at 14.63 but only after bouncing back from a low of 14.37, meaning that it met the initial target at the 1 Dec ’14 low at 14.41. The choppy, downside momentum seems set to continue, with the next support, below 14.35/40 to be seen at the 200 MMA (14.15), which should be very strong at the first attempt, and eventually to the major rising trend support, joining the 2003/2008 lows, at 13.00. The longer term target would seem to be somewhere around 8.40 (Oct 2008 low) albeit that this is a long way off at this stage. Back above 15.00, which looks doubtful, the topside will find sellers at 15.25, 15.40 and again at 15.75/85 ahead of 16.00. Selling into strength is again favoured, on the back of a view of a strengthening dollar, but with a tight SL placed above 16.00. |
| OIL(WTI) | 48.03 | WTI extend losses to new weekly lows of 47.70 on Friday after a rise in the number of operational U.S. oil rigs, which rose from 638 to 659. Further losses appear to lie ahead, with the next support to be seen at the Fibo level at 46.80 (76.4% of 42.02/62.55). A break of this leaves a bit of a black hole of support which potentially could see a steeper decline towards 44.90 and 44.60 (both minor) ahead of 43.56 (29 Jan low) and 42.02(18 march low). The topside will encounter offers at 48.50 (minor), 49.50 (100 HMA) and at 50.00. The short term descending trend resistance (from 24 June high: 61.54) is currently at 51.70 but falling rapidly, so do not discount a move back to meet this area. Selling rallies remains the theme, but note that the hourlies are showing some mild bullish divergence, so there is a good chance of seeing a run back towards 49/50, and even towards 51.00, before the bigger downtrend continues. |
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