Technicals | 11:20 AM
Tony Sycamore, Market Analyst, IG shares his technical views on the Nasdaq, ASX200, gold and crude oil.
By Danielle Ecuyer
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
Post the Nasdaq100’s surge higher on the 12th of May, we have been working with the view that the rally in the Nasdaq100 from the 21st of April 17,592 low is a Wave iii (Elliott Wave) and once it’s complete, it should be followed by a Wave iv pullback.
The rebound in late June from our key 21,500/450ish support zone opened the way for the Nasdaq (Wave iii) to push to record highs taking it to within a stone’s throw of strong weekly trend channel resistance now at 23,350ish.
We do expect this weekly resistance level to at least stall the Nasdaq100’s recent gains. However, a sustained break of short-term support at 22,650/550 is needed to indicate that the Wave iii is complete and that a Wave iv pullback is underway.
The initial target for the Wave iv is a band of support near 22,000 with a sustained break of this level opening the way for a deeper Wave iv decline towards support at 21,500/300.
ASX200
After last Wednesday’s sell-off in the ASX200 held above our 8530/10 support zone, the ASX200 regrouped, and spring boarded to fresh record highs into the end of last week.
Providing the ASX200 holds above short-term support at 8620/00ish coming from previous record highs, we expect the ASX200 to extend its gains towards 8850.
Aware that a daily close below 8600 would be initial warning that last week’s break higher was a false break and that a retest of the late June 8420 low is underway.
Crude Oil
WTI Crude Oil finished lower overnight at US$65.45 (-0.50%), as tariff and trade war concerns offset the support provided by a softer USD and lower US yields.
The EU is reportedly exploring additional trade countermeasures against the US if an acceptable trade agreement with the US cannot be reached by the August 1 deadline.
Technically, the rejection from last week’s US$69.65 high has shifted the focus back to support at US$65/US$64/bbl, which crude oil needs to hold above to keep hopes alive for a rebound into the low US$70s.
Gold
Gold finished higher overnight at US$3431 (1.02%), boosted by trade war concerns and a softer USD and lower US yields.
The acceleration higher this week, away from uptrend support now at US$3320ish, keeps gold on track to retest and break the US$3500/oz record high.
Technical limitations
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