Daily Global Macro Technicals Trend Bias/Key Levels (Thurs 10 May)

Extended USD strength remains on support except in GBP. Imminent potential bullish breakout in S&P 500 while uptrend remains intact for WTI Crude.

FX –  USD strength remains on support except in GBP

  • EUR/USD – Trend bias: Downtrend remains intact but downside momentum has started to abate. The pair inched lower as expected and printed a new minor lower low of  1.1823 in yesterday, 09 May European session. Maintain bearish bias with a cautious stance as the 4 hour Stochastic oscillator has started to flash a bullish divergence signal at its oversold region coupled with a daily “Doji” candlestick pattern. Adjusted key short-term resistance to 1.1900 (former minor swing low area of 07 May 2018 that had been tested and rejected yesterday + minor descending trendline from 19 Apr 2018 high) for a further potential residual push down to target the next support at 1.1740/1700 (the swing lows area of 21 Nov/12 Dec 2017 + 38.2% Fibonacci retracement of the 1 year of up move from 03 Jan 2017 low to 16 Feb 2018 high + 2.618 Fibonacci projection of the down move from 27 Mar 2018 high). However, a clearance above 1.1940 brings back the mean reversion rebound into play for a push up towards 1.2030 and an hourly close above 1.2030 is likely to reinforce a further up move to target the next intermediate resistance at 1.2130/2180.
  • GBP/USD - Trend bias: Short-term mean reversion rebound scenario remains intact. The pair has continued to hover above the 1.3430 key short-term support and attempted to break above the 1.3590 upside trigger level (minor range top from 04/05 May 2018) as it printed a high of 1.3607 in yesterday, 09 May European session before it pull-back towards 1.3540. No change, maintain bullish bias above 1.3430 key short-term support (swing low area of 11 Jan 2018 + 38.2% Fibonacci retracement of the 16-month up move from 16 Jan 2017 high to 17 Apr 2018 high) with 1.3607 as the upside trigger (an  hourly close above it) to reinforce a potential push up to target the next intermediate resistance at 1.3700/3760 (pull-back resistance of the former medium-term ascending channel support from 14 Mar 2017 low + former swing low areas of 09 Feb/01 Mar 2018 + 23.6% Fibonacci retracement of the on-going slide from 17 Apr high to 04 May 2018 low). On the other hand, failure to hold at 1.3430 sees an extension of the down move towards 1.3280/3200 next (former congestion area of 13 Oct/01 Nov 2017 + 50% Fibonacci retracement of the 1 year of up move from 16 Jan 2017 low to 17 Apr 2018 high).
  • AUD/USD - Trend bias: Downtrend continues to extend. The pair had continued to drop lower as expected and printed a new minor lower low of 0.7412 in yesterday, 09 May European session. No change, maintain bearish bias with 0.7495 remains as the key short-term resistance (former minor ascending trendline from 01 May 2018 low + minor descending trendline from 04 May 2018 high) for a further potential down move to target the next intermediate support at 0.7370/0.7330 next (the swing low areas of 08 May/01 Jun 2017 + 61.8% Fibonacci retracement of the up move from 15 Jan 2016 low to 26 Jan 2018 high). However, a clearance above 0.7495 sees a push up to retest 0.7550 (04 May 2018 minor swing high formed from the recent rebound from 01 May low) and an hourly close above 0.7550 is likely to see the start of a potential mean reversion rebound towards the next intermediate resistance at 0.7600/7640 (the former swing low areas of 29 Mar/09 Apr 2018 + 38.2%/50% Fibonacci retracement of the down move from 19 Apr high to 01 May 2018 low).
  • NZD/USD - Trend bias: Downtrend continues to extend. The pair had met the first downside target/support of 0.6930/6910 (printed a current intraday low of 0.6916 in today, Asian session) as per highlighted in yesterday report reinforced by a dovish RBNZ in its latest monetary policy meeting concluded earlier today where the NZ central bank cut its forecasts for GDP and inflation growth. Maintain bearish bias with 0.7000 remains as the key short-term resistance with 0.6910 as the downside trigger level (former swing high area of 09 Nov 2017 + 76.4% Fibonacci retracement of the up move from 17 Nov 2017 low to 16 Feb 2018 high). An hourly close below 0.6910 reinforces a further potential down  move to target the medium-term support of 0.6820 (swing low areas of 11 May/17 Nov 2017). However, a clearance above 0.7000 puts the mean reversion rebound scenario into play for a push up to retest 0.7095/71185 (the minor swing high areas of 26/28 Apr 2018 + 38.2% Fibonacci retracement of the on-going decline from 13 Apr high to 08 May 2018 low).
  • USD/JPY - Trend bias: Uptrend remains intact.  Continued to inch higher as expected and the pair seeks to retest 02 May high of 110.03.  No change, maintain bullish bias above adjusted key short-term support now at 109.35 (former minor swing high area of 07 May 2018 + 50% Fibonacci retracement of the recent up move from 09 May low to yesterday, 09 May high of 109.92) for a further potential push up to target the 110.85/111.00 resistance (the former medium-term swing low area of 27 Nov 2017 & the 61.8% Fibonacci retracement of the multi-month decline from 06 Nov 2017 high to 26 Mar 2018 low).  On the other hand, failure to hold at 109.35 negates the bullish tone for a slide back to retest the 108.70 minor range support in place since 04 May 2018 low and only a break below 108.70 (an hourly close below it) triggers a deeper pull-back towards the key medium-term support zone of 107.80/40 (former medium-term swing high area of 21 Feb 2018 + 50% Fibonacci retracement of the on-going up move from 26 Mar low to 02 May 2018 high).  

Stock Indices (CFD) – Imminent potential bullish breakout in S&P 500

  • US SP 500 – Trend bias: Potential bullish breakout from “Symmetrical Triangle” range resistance. The Index has continued to inch higher as expected and now it is approaching the short-term resistance/target of 2720 which is our medium-term upside trigger level; the upper boundary of the 4-month “Symmetrical Triangle” range configuration in place since late Jan 2018. Based on technical analysis factors from other leading indices/sectors (Semiconductor sectors-SOXX & NYSE FANG+, refer to our latest weekly technical outlook published on Mon, 07 May for the details), the SP 500 is likely to stage a bullish break out soon from its on-going range configuration. Yesterday’s price action on the high beta Nasdaq 100 Index has increased such probability as it broke above its parallel resistance level at 6855 (the former swing high area of 18 Apr 2018 + 61.8% Fibonacci retracement of the steep decline from 13 Mar 2018 all-time high to 04 Apr 2018 reversal low). Maintain bullish bias on the S&P 500 in any dips with an adjusted key short-term support now at 2674 (yesterday, 09 May U.S. session low + close to the 23.6% Fibonacci retracement of the on-going up move 03 May 2018 low to today, 10 May current Asian session high of 2702) for a further potential push to target 2720. An hourly close above 2720 in the U.S. session opens up scope for a further potential rally to target the next intermediate resistance at 2743 (upper boundary of a minor ascending channel from  03 May 2018 low + 1.00 Fibonacci projection of the up move from 03 May 2018 low). However, failure to hold at 2674 sees the risk of a deeper pull-back retest the 2657/55 support (minor swing low area of 08 May 2018 + former minor swing high area of 03 May 2018).
  •  Japan 225 Trend bias: Push up towards range resistance/key medium-term upside trigger. No change, maintain bullish bias with 22340 remains the key short-term support for a further potential push up to target the 22710 range resistance/medium-term upside trigger level (61.8% Fibonacci retracement of the decline from 23 Jan high to 23 Mar 2018 low). However, failure to hold at 22340 see a slide back to retest last week  low of 22088.
  • Hong Kong 50 Trend bias: Push up towards minor range resistance. Inched higher as expected and met the lower limit of the minor range resistance of 30760/830. Maintain bullish bias in any dips above adjusted key short-term support now at 30600 (today, 10 May Asian session opening gapped up + minor ascending channel support from 07 May 2018 low) for a further potential push up to target the upper limit of the minor range resistance at 31100 (minor swing high area of 12 Apr 2018).  On the other hand, failure to hold at 30600 negates the bullish tone for a deeper pull-back towards the next intermediate support at 30340/30200 (minor swing low area 08 May 2018 + 50%/61.8% Fibonacci retracement of the on-going up move from 07 May low to today, 10 May current Asian session high of 30880).
  • Australia 200 – Trend bias: Uptrend remains intact. Pushed up higher as expected and almost met the 6150 resistance/target (printed a current intraday high of 6147 in today, 10 May Asian session). Maintain bullish bias with adjusted key short-term support now at 6087 (minor range bottom in place since 08 May 2018) for a further potential push up to target the 6210 intermediate resistance next (upper boundary of a minor ascending channel from 25 Apr 2018 low + Fibonacci projection cluster). On the other hand, failure to hold at 6087 negates the bullish tone for a deeper pull-back to retest the next intermediate support of 6080/78 (swing low of 07 May 2018).
  • Germany 30Trend bias: Uptrend remains intact. Push up high as expected. Maintain bullish bias in any dips above adjusted key short-term support now at 12890 (yesterday, 09 May European session low + 23.6% Fibonacci retracement of the on-going up move from 01 May low to 09 May 2018 high) for a further potential push up to target 13020 before the next intermediate resistance at 13140/150 (76.4% Fibonacci retracement of the steep down move from 23 Jan high to 06 Feb 2018 low + upper boundary of a minor ascending channel from 04 Apr 2018 low). However, failure to hold at 12890 negates the bullish tone for a deeper pull-back to retest the 1281/800 support (minor swing low area of 07 May 2018)

Commodities –  Uptrend intact for WTI Crude

  • WTI Crude (Jun 2018) – Trend bias: Uptrend remains intact.  Pushed up higher as expected and surpassed the recent minor swing high of 70.82 printed on 07 May 2018. Maintain bullish bias in any dips with adjusted key short-term support now at 70.60 (yesterday, 09 May U.S. session low + close to the 23.6% Fibonacci retracement of the on-going up move from 08 May 2018 low to today, 10 May current Asian session high of 71.75) for a further potential push up to target the next resistance at 73.30/90 (the upper boundary of a major ascending channel from Feb 2016 low + Fibonacci projection cluster). On the other hand, failure to hold at 70.60 negates the bullish tone for a deeper pull-back towards the next intermediate support at 69.20/68.60 (recent reversal low area of 08 May 2018 + minor ascending trendline from 02 May 2018 low).
  • Gold - Trend bias: Unclear. Continued to trade sideways. No change, maintain neutrality stance between 1300 and 1323 (former minor swing low areas of 29 Mar/23 Apr 2018). Only a break above 1323 (an hourly close above it) sees a potential push up towards the next intermediate resistance at 1334/41 (the minor descending resistance from 11 Apr 2018 high + former minor swing low of 13 Apr 2018) within a major sideways range configuration in place since Jul 2016.

*Levels are obtained from City Index Advantage TraderPro platform




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