THE TAKEAWAY – The US Dollar has cleared important support but lack of confirmation from the S&P 500 casts doubt on the move’s bearish implications for the safe-haven currency.
S&P 500 – The longer-term formation of the Head and Shoulders top we initially noticed two weeks ago and have beenmonitoring since continues play out, with prices consolidating between the 50% and 23.6% Fibonacci extension levels at 1299.41 and 1330.61, respectively. Overall positioning remains bearish whilst below 1358.50. A break below current support exposes 1285.46. Alternatively, a near-term push higher targets 1341.24.
CRUDE OIL – Prices put in a Doji candlestick below resistance at $99.22, the 38.2% Fibonacci retracement of the drop from the early May swing high, pointing to indecision and hinting a move lower is ahead. The setup reinforces the likelihood of a forming Ascending Triangle chart pattern, mirroring the one carved out from early May through mid-June and arguing for bearish continuation. A break through triangle support at $95.50 initially exposes $94.13 and $92.51.
GOLD – Prices rebounded from support lines at $1578.82, the 23.6% Fibonacci retracement level, having taken out rising channel support that upheld the rally since the beginning of the month. The move appears corrective, with a push above the July 19 high at $1609.95 needed to neutralize near-term selling pressure. A resumption of bearish momentum that clears current support initially exposes $1559.56. Longer-term positioning remains broadly bullish.
US DOLLAR – Prices broke through support marked by the lower boundary of a Triangle consolidation chart pattern, exposing the bottom of a falling channel that has guided prices since late June (now at 9513). The underside of the Triangle has been recast as near-term resistance, and now stands at 9586.
