Technicals | 11:05 AM
Earlier today, Tony Sycamore, Market Analyst, IG updated his views and thoughts on financial markets, including the technical analysis.
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
The rally from the September 22,977 low is viewed as an extending Wave V from the April 16,542 low.
Within our preferred Elliott Wave framework, once a five-wave advance is complete, the expectation is for a correction to commence.
A solid indication that a Wave V advance is complete and that a deeper correction has begun would be if the Nasdaq100 were to see a sustained break/close below short-term horizontal and tren line support at 25,000ish.
This would warn that a deeper pullback is underway, initially towards a band of support between 24,200/23,950.
Aware that while the Nasdaq100 holds above short-term support at 25,000, allow for the uptrend in the Nasdaq to continue towards the next upside target of 27,000.
ASX200
Following its break of short-term support at 8990/8970ish early last week, the ASX200 yesterday cratered below the critical 8850/40ish support zone.
This has created technical damage to the uptrend and opens the way for deeper pullback, initially into the 8730/8630 support region, coming from the lows of July and August.
Below here, the next level of support is at 8630ish coming from the high of early June and the low of early August.
A sustained rebound back above 8900 and into the trend channel would be an initial sign that the recent pullback from the 9115.2 high is complete.
Crude Oil
WTI Crude Oil is trading lower at US$60.43 (-0.97%), as risk sentiment shifted sharply negative, boosting the safe haven US dollar, both of which weighed on the crude oil price.
We are currently holding a neutral bias in crude oil, needing to see a sustained break of resistance at US$62.50/US$63.00ish (possible neckline of inverted head and shoulders) to signal that the rebound from the recent US$55.96 low can extend towards the next layer of resistance at US$65.30/US$66.50, which includes the 200-day moving average.
Gold
Gold is trading lower at US$3939 (-1.56%), undercut by a rally in the USD to a three-month high and receding expectations of a Fed rate cut in December.
The metal’s decline on a night of broad risk aversion —when it would normally be expected to rally— signals that the market remains excessively long.
This reinforces our technical view that gold is likely to see a deeper pullback toward US$3,500.
Technical limitations
If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.
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