Technicals | 11:30 AM
Earlier today, Tony Sycamore, Market Analyst, IG updated his views and thoughts on financial markets, including the technical analysis updates.
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
Within the rally from the April 16,542 low, the gains from the September 22,977 low are viewed as an extending Wave V. Under our preferred Elliott Wave framework, once a five-wave advance is complete, the expectation is for a correction to commence.
The Nasdaq’s rebound back above our short-term reassessment level of 25,000 on Friday night, followed by its overnight recovery above the trendline support from the April lows keeps the Nasdaq’s uptrend intact and with it prospects of a push towards 27,000.
Aware that a sustained break below a band of support at 24,600/24,200 would create technical damage and warn that a deeper pullback is unfolding.
ASX200
From its 9115.2 record high of October, the ASX200 fell -4.18%, into last week’s 8733.8 low.
It is imperative that the critical 8730-support area continues to hold and that it rebounds above 8900 to repair the technical damage done in recent weeks (break out of the bottom of the trend channel) and to avoid the ASX200 taking another leg lower into the 8630-support area.
Crude Oil
WTI Crude Oil is trading higher at US$60.96 (up 1.52%), poised for a third day of gains ahead of the imminent reopening of the US government which will likely boost consumer confidence economic activity and demand for crude oil in the weeks ahead.
The overnight break above short term resistance at US$61.50 opens up a move towards resistance at US$62.50/US$63.00ish, which is also the neckline of wonky inverted head and shoulders bottom.
A break above US$62.50/US$63.00 would signal the rally can extend further towards the next layer of resistance at US$65.00/US$66.50, which includes the 200-day moving average and highs from September.
Gold
Gold is trading higher at US$4129 (+0.33%) supported by soft labour market data and last week’s soft consumer confidence reading which has raised hopes of a Fed rate cut in December.
Technically, our view is that the rally from the US$3886 low to the overnight US$4149 high is part of the second wave of a three-wave correction from the US$4381 high. which will ultimately lead to a pullback towards US$3670.
However, we are open to the idea that the pullback from the US$4381 high is complete at the US$3886 low.
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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