Technicals | Dec 04 2024
Earlier today, Tony Sycamore, Market Analyst, IG updated his views and thoughts on financial markets, including the technical analysis updates below.
All material has been re-published with permission and does not by association represent FNArena’s views (we have none, we simply report).
First Up, Nasdaq100
New highs for the Nasdaq100 this week which opens up further gains towards 21,500 before weekly trend channel resistance at 22,300 viewed on the weekly chart below.
Bullish seasonality favours further gains for US equities from mid-December into mid-January. Historically, the last two weeks of December rank as the third-best two-week period of the year, averaging a +0.99% return.
The first two weeks of January are even more positive, boasting an average return of 1.61%. The last two weeks of December and the first two weeks of January create the most favourable four-week stretch of the year, with an average return of 2.6%.
We would only see cause for concern if the Nasdaq100 were to see a sustained break below 20,315 and then below medium-term support 19,850/650ish.
Australia: ASX200
Following the ASX200’s sequence of higher highs over the past six weeks, we have redrawn higher our trend channel resistance.
To that effect the ASX200 needs to see a sustained break above trend channel resistance, currently at 8495-ish, to signal a more impulsive move higher is underway.
Otherwise, we expect to see more of the two-step forward, one step back type price action viewed since September.
On the downside, a sustained break below 8300 would be the first indication that the ASX200 may have topped and that a deeper decline is underway.
WTI Crude
WTI Crude Oil is trading higher at US$70.00/bbl (+2.79%), driven by new US sanctions on Iranian oil and expectations that OPEC-plus will extend its production cuts for three months, alleviating oversupply concerns.
The rebound was also supported by Israel’s threatened military action against Lebanon if its truce with Hezbollah collapses. While crude oil remains below resistance at US$72.50-ish, downside risks remain towards the range lows in the US$66.00/65.00/bbl area.
Gold
Gold is trading higher at US$2642/oz (+0.13%), boosted by dovish comments from Fed Governor Waller yesterday morning, raising expectations of a Fed rate cut in December.
Technically, we are neutral gold at the current price with a preference of being a buyer towards the support provided by wave equality and the 200-day moving average US$2450/2430/oz area.
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