Daily Global Macro Technical Trend Bias/Key Levels (Mon 01 Oct)

Further USD strength while S&P 500 and DAX may see further weakness

FX –  Further potential upside in USD

  • EUR/USD – Trend bias: Down. Dropped lower as expected and ended last week with a close at 1.1600 (end of U.S. session) which was below the prior week close of 1.1747. It also reintegrated below the pull-back support of the former neckline resistance of the “Inverse Head & Shoulders” that took shaped since 07 Jun 2018 which invalidated the recent bullish breakout seen on 20 Sep 2018. No change, maintain bearish bias in any bounces below tightened key short-term resistance at 1.1660 (50% Fibonacci retracement of the on-going decline from post FOMC 26 Sep 2018 high of 1.1798 to last Fri, 28 Sep U.S. session low of  1.1569 + former minor swing low area of 19 Sep 2018 + minor descending trendline from 24 Sep 2018) for another potential downleg to target the next near-term support at 1.1530  (minor swing low areas of 04/10 Sep 2018). A break below 1.1530 is likely to trigger a further potential downward acceleration to retest the major support at 1.1445/1410 (the major pull-back range support from May 2015/Jul 2017 of a 2-year range configuration that was challenged but held recently on the week of 13/17 Aug 2018). However, a clearance above 1.1660 negates the bearish tone for a deeper corrective rebound towards the next intermediate resistance at 1.1730 (former minor range support of 21/26 Sep 2018).
  • GBP/USD - Trend bias: Down.  Dropped lower as expected and ended last week with a bearish weekly “Shooting Star” candlestick, a similar negative sentiment pattern as compared with its prior weekly bearish “Gravestone Doji” candlestick. No change, maintain bearish bias in any bounces below a tightened key short-term resistance now at 1.3110 (minor descending trendline from 20 Sep 2018 high +  50% Fibonacci retracement of the on-going  decline from post FOMC 26 Sep 2018 high of 1.3218 to last Fri, 28 Sep low of 1.3000) for a further potential push down to target the next near-term support at 1.2890 next (minor swing low areas of 24 Aug/05 Sep 2018). A break below 1.2890 is likely to trigger a further potential downward acceleration towards 1.2810/2790 (the minor swing low areas of 24 Aug/05 Sep 2018 + 76.4% Fibonacci retracement of the recent up move from 15 Aug 2018 low to 20 Sep 2018 high). However, a clearance above 1.3110 negates the bearish tone for a deeper corrective rebound towards the intermediate resistance at 1.3210/3220 (minor swing high area of 26 Sep 2018).
  • USD/JPY - Trend bias: Up. Continued to push higher as expected. No change maintain bullish bias in any dips above tightened key short-term support now at 113.30 (minor swing low area of 28 Sep 2018 + Fibonacci retracement/projection) for a further potential push up to target the next resistance at 114.10/30 (Fibonacci projection cluster + major range resistance from 09 May /03 Nov 2017). However, failure to hold at 113.30 sees a deeper pull-back to retest the 113.00/112.80 support (former minor swing high areas of 25/26 Sep 2018 + lower boundary of the minor ascending channel from 07 Sep 2018).  
  • AUD/USD – Trend bias: Down. Last Fri, 28 Sep bounce has managed to stall below the predefined key short-term resistance of 0.7260 as per highlighted in our previous report (printed an intraday high of 0.7241 in the U.S. session before it reversed down to close near its low at 0.7217. In addition, it ended last week with a weekly “Bearish Harami” candlestick pattern after a test on the upper boundary/resistance of its medium-term descending channel from 26 Jan 2018 high. No change, maintain bearish bias in any bounces below 0.7260 key short-term resistance for another potential downleg to target the next near-term support at 0.7140/7125. However, a clearance above 0.7260 negates the bearish tone for a squeeze up to retest 0.7330 (23.6% Fibonacci retracement of the primary down move from 26 Jan 2018 high to 11 Sep 2018 low + close to the upper boundary of the medium-term descending channel from 26 Jan 2018 high + former range support from 02 Jul/09 Aug 2018).
  • NZD/USD – Trend bias: Down. Last Fri, 28 Sep bounce has managed to stall below the 0.6650 predefined key short-term resistance as per highlighted in our previous report (printed an intraday high of 0.6640 in the U.S. session before it reversed down to close near its low at 0.6615. In addition, it ended last week with a weekly “Bearish Harami” candlestick pattern. No change, maintain bearish bias in any bounces below 0.6650 key short-term resistance for another potential downleg towards 06535 follow by the 11 Sep 2018 low area of 0.6500. However, a clearance above 0.6650 negates the bearish tone for a squeeze up to retest 0.6700/6720 (minor range resistances of 21 Sep 2018 & 22/29 Aug 2018).

Stock Indices (CFD) – Mix bag with further potential weakness in S&P 500 & DAX

  • US SP 500 – Trend bias: Down. The Index has managed to push down lower as expected during last Fri, 28 Sep Asian/Europeans session to print a low of 2903 before it pared its losses in the U.S. session. Interestingly, it ended the week with a weekly “Bearish Harami” candlestick coupled with a monthly “Spinning Top” candlestick. These patterns indicate the on-going bulls are hesitant to push prices higher. No change, maintain bearish bias below 2927/31 key short-term resistance for a potential push down to retest the near-term support at 2902/2900 (the recent minor swing low of 27 Sep 2018 + lower boundary of the minor descending channel). On the flipside, a clearance above 2931 put the bears on hold to see a squeeze up to retest the 2940 key long-term pivotal resistance.
  • Japan 225 – Trend bias: Sideways. The Index did not have a daily close above the 24200 key medium-term range resistance on last Fri, 28 Sep. Thus, maintain neutrality stance between 24200 and 23950 (the lower boundary of the minor ascending channel). A break (an hourly close) below 23950 sees a potential slide to test the support at 23580 (minor swing low of 20 Sep 2018). On the flipside, a daily close above 24200 validates a further up move to target the next intermediate resistance at 24800/880 (Fibonacci projection cluster + upper boundary of a minor ascending channel from 07 Sep 2018 low).
  • Hong Kong 50 – Trend bias: Sideways. Inched lower but still within the minor range configuration. No change, maintain neutrality stance between 28000 & 27400 (minor swing low area of 24 Sep 2018 + minor ascending trendline from 11 Sep 2018 low). Only a break (an hourly close) below 27400 triggers at least a minor slide to target the near-term support at 26730 (the minor swing low areas of 17/18 Sep 2018) in the first step. On the flipside, a daily close above the 28000 key medium-term pivotal resistance sees an extension of the corrective rebound in place since 11 Sep 2018 low to target the next intermediate resistance at 28580/600 (minor swing high areas of 28/30Aug 2018).
  • Australia 200 – Trend bias: Sideways. Pushed down but managed to hold the lower boundary of the on-going “bearish flag” ascending range configuration in place since 07 Sep 2018 swing low area of 6100 now acting as a support at 6170. Mix elements now, thus prefer to turn neutral between 6200 (minor swing high area formed on last Fri, 28 Sep U.S. session) and 6170. A break with an hourly close below  6170 is likely to trigger a bearish breakdown from the “bearish flag” for a down move to retest the 6130/26 near-term support in the first step (minor swing low areas of 10/13 Sep 2018). On the flipside, a clearance above 6200 sees a push up towards 6250, the upper boundary of the “bearish flag” which is also the key medium-term pivotal resistance as defined by the former “Expanding Wedge” range support and the 50% Fibonacci retracement of the recent decline from 30 Aug 2018 high to 07 Sep 2018 low.
  • Germany 30 – Trend bias: Down. Broke below the 12270 lower limit of the neutrality range as per highlighted in our previous report and also the minor ascending trendline support from 11 Sep 2018 low. Turn bearish in any bounces below key short-term resistance at 12310 (50% Fibonacci retracement of the recent slide from 28 Sep 2018 European session high of 12435 to 28 Sep U.S. session low of 12188) for a further potential push down to target the next near-term support at 11990 (minor swing low area of 18 Sep 2018) follow by 11900 (swing low areas of 07/11 Sep 2018). On the flipside, a break above 12310 put the bears on hold for a choppy up move to retest the minor range resistance of 12460 in place since 21 Sep 2018.

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