Gold has been quiet lately, but we could soon see a probe of the multi-tested November trend-line, an important ‘line-in-the-sand.’ Crude oil got dinged and is in the process of having its surge off the December low put to the test, may fail if ‘risk trade’ turns south as it looks like it may. The Dow Jones along with its gang of U.S. indices hit and is trying to turn off resistance, watch how selling develops in the days ahead. The DAX is at even bigger resistance.
- Gold to test November trend-line post weekly rejection
- Crude oil could weaken some more with ‘risk trade’
- Dow Jones turning off resistance with other U.S. indices
- DAX has confluence of big resistance, looking to turn lower
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Gold to test November trend-line post weekly rejection
Gold is backing down off long-term resistance towards an important intermediate-term threshold – the November trend-line. A hold of this line will be needed to keep gold pointed higher. A break will confirm last week’s reversal from long-term resistance and keep price well contained in the big-picture wedge forming.
Gold Daily Chart (Nov t-line)
For an intermediate-term fundamental and technical outlook check out the Gold Forecast
Crude oil could weaken some more with ‘risk trade’
WTI crude oil backed off a bit and is trying to hold a bid now, but if the ‘risk trade’ turns lower will force then that is likely to not remain the case. Stocks (see below) look poised for selling given resistance levels and if hitting bids becomes aggressive look for similar to develop in oil. Trend-line support off the low is minor at this point, but worth noting.
WTI Crude oil Daily Chart (May come under fire)
For an intermediate-term fundamental and technical outlook check out the Crude Oil Forecast
Dow Jones turning off resistance with other U.S. indices
The Dow Jones hit the 26k-area alongside the S&P 500 hitting its important resistance zone just above 2800. This has U.S. markets at risk of reversing back lower. The Dow has a solid upward channel in place that will first have to be undermined if it is to trade off in a meaningful way. Risk is high at this time we see a material test of the rally off the December low.
Dow Jones Daily Chart (26k-area, channel in focus)
For an intermediate-term fundamental and technical outlook check out the Global Equities Forecast
DAX has confluence of big resistance, looking to turn lower
The DAX is at a big intersection of resistance. The neckline of the head-and-shoulders dating back to 2017 and the June trend-line both arrive in the current vicinity. On a rougher weekly basis, the 2011 trend-line is also passing through the area. From a macro standpoint this may turn out to be a very important point in time. First up on a dip lower for short-term traders is the tend-line off the December low.
DAX Daily Chart (Cross-roads of resistance)
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—Written by Paul Robinson, Market Analyst
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