Technicals | 10:45 AM
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
Since the Nasdaq100’s surge higher on May 12th, we have been operating under the view that the rally from the April 21st low of 17,592 is a Wave iii (Elliott Wave). Once this wave is complete, it should be followed by a Wave iv correction.
Following the Nasdaq100’s break and close below support at 23,000/22,900 last Friday night, we believe there is a strong chance that a Wave iv correction is underway, with an initial target of 22,200–22,000, coming from previous record highs.
A sustained break below this level could open the way for a deeper Wave iv decline toward support at 21,500–21,300.
ASX200
After hitting a fresh record high of 8776.4 in Mid-July, the ASX200 has since spent the past two weeks range trading above short-term support at 8620/00ish and below the record high.
Providing the ASX200 remains above our 8620/00 reassessment zone, there remains the potential for a push towards 8850ish.
Aware that a daily close below the support at 8620/00 warns that retest of the late June 8420 low is underway.
Crude Oil
WTI Crude Oil finished lower overnight at US$65.17/bbl, down -1.62%, marking a fourth consecutive session of declines after OPEC-Plus announced over the weekend it will increase production by 547,000 barrels per day for September.
This move overshadowed the risks of US secondary tariffs on buyers of Russian oil, which could take effect as early as this week.
After rejecting last week’s high of US$70.51, crude oil is gravitating back toward the US$65/US$64 support zone.
The probability of a break below this support level is increasing daily and could lead to a test of support at US$60.00/bbl as the next likely target.
Gold
Gold finished higher overnight at US$3,380/oz, up 0.22%, extending its gains that followed Friday night’s dire US jobs report, which has now fully priced in a Fed rate cut in September.
The rebound from the US$3,265–US$3,245 support zone on Friday suggests gold is consolidating its gains from the first half of this year within a range roughly between US$3,450 and US$3,250.
A sustained breakout above resistance near US$3,450 would be required to signal that a retest of the record high of US$3,500/oz is underway.
Technical limitations
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