Technicals | 10:30 AM
Tony Sycamore, Market Analyst, IG shares his technical views on the Nasdaq, ASX200, gold and crude oil, including technical 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
The rally in the Nasdaq100 to new record highs has confirmed the Wave iv pullback from the mid-August high of 23,969 concluded in early September at the 22,977 low and that a Wave V within our preferred Elliott Wave framework is underway.
The close on Saturday morning, above weekly trend channel resistance, currently near 24,200ish (weekly close) indicates there is room for the Wave V to extend towards 25,000ish possibly to 26,000 if FOMO really starts to play a role and grip markets.
Keep in mind that a Wave V high should then be followed by a corrective pullback.
ASX200
The heavy fall in the ASX200 at the start of this month and the past three weeks of consolidation has helped the ASX200 to work off overbought readings after its run of new highs in August.
Providing the ASX200 remains below last week’s 8888 high, we expect the correction which targets the 8600/8580 area to continue.
If this correction plays out as anticipated, it will account for a neat -5% pullback from the 9054.5 record high, at which point fresh longs should be considered.
Crude Oil
WTI Crude Oil finished higher overnight at US$63.65/bbl, up 2.1% on escalating European geopolitical risks as Ukrainian drones continue to strike Russian oil infrastructure and with exports from Iraq’s Kurdistan region remaining on hold.
There had been an assumption priced into the market that Kurdish exports, disrupted since March 2023 due to a Turkey-Iraq pipeline, dispute were set to return. However, those hopes appear dashed for now due to unresolved arrears.
Technically, crude oil appears comfortable in a trading range with the upper boundary defined by the early September US$66.03 high and reinforced by the 200-day moving average at US$66.95./bbl
The recent double low at US$61.45, which crude oil tested and bounced from this week, defines the lower bound of the range.
Gold
Gold’s gains have been supported by the Fed’s highly anticipated rate cut last week, with signals of further reductions to come, which is bullish for gold.
Additional support has come from safe-haven flows driven by European geopolitical concerns and fears over the Fed’s independence, coupled with strong demand from central banks and private investors.
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.
Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided.
FNArena is proud about its track record and past achievements: Ten Years On