Daily Key Short Term Technical Levels Mon 30 Oct 2017

FX –Risk of minor decline in USD before new potential upleg

• EUR/USD – It did not stage the expected corrective rebound as per highlighted in our pervious report and inched lower to print a new marginal lower low of 1.1575 in last Fri (27 Oct) U.S. session which was closed to the upper limit of the short-term support/target of 1.1570/1550. The hourly RSI oscillator has continued to flash a bullish divergence signal at its oversold region which suggests that the risk of a minor corrective rebound (wave iv) still prevails. Potential corrective rebound zone stands at 1.1635/1.1675 (23.6%/38.2% Fibonacci retracement of the recent decline from 26 Oct 2017 high to 27 Oct 2017 low + lower limit of former “Head & Shoulders” neckline support”). Key short-term resistance will be at 1.1714 (close to 50% Fibonacci retracement of the recent decline from 26 Oct high to 27 Oct 2017 low + upper limit of former “Head & Shoulders” neckline support”), thereafter another potential bearish impulsive downleg (minor degree wave v)  may materialise towards the next intermediate support at 1.1550 (lower boundary of the medium-term descending channel from 08 Sep 2017 high + Fibonacci projection cluster).
• GBP/USD – Broke below the 1.3100 lower limit of the neutrality zone as per highlighted in our pervious report. Printed a low of 1.3070 in last Fri (27 Oct) European session before it bounced up towards its former minor ascending trendline support from 20 Oct 2017 low now turns pull-back resistance at 1.3150. Turn bearish below 1.3170 key short-term resistance (50% Fibonacci retracement of the recent drop from 26 Oct high to 27 Oct 2017 low + close to the aforementioned pull-back resistance) for another potential push down to test the next intermediate support at 1.3030/3015 (Fibonacci cluster + 06 Oct 2017 minor swing low).
• AUD/USD – Adjust the key short-term resistance to 0.7725 (minor descending trendline from 19 Oct 2017 high + 38.2% Fibonacci retracement of the recent drop from 19 Oct high to 27 Oct 2017 low) from 0.7690 to take into account the risk of an on-going minor corrective rebound (minor degree wave iv) to retrace last week’s steep drop. Thereafter, another potential bearish impulsive downleg may materialise (minor degree wave v) towards the next intermediate support at  0.7595/7585 (lower boundary of medium-term descending channel from 21 Sep 2017 high + Fibonacci projection cluster).
• NZD/USD -  Mix elements prevail, maintain neutrality stance between 0.6810 & 0.6910 as per highlighted in our pervious report.
• USD/JPY – Rallied as expected and hit the first resistance/target of 114.40 (printed a high of 114.45 in last Fri, 27 Oct European session).  Pull-backed towards the minor ascending trendline from 16 Oct 2017 low now acting as a support at 113.65. Maintain bullish bias above 113.34 key short-term support (also minor “Expanding Wedge” support in place since 24 Oct 20147 low) for a potential final push up towards the next intermediate resistance of 114.70 (major descending trendline from Jun 2015 +  Fibonacci projection cluster). Recall that in our previous reports, we had highlighted that the on-going upmove from 08 Sep 2017 low is still corrective in nature as the pair is still evolving within a longer-term complex range configuration in place since the start of 2017.

Commodities – Corrective decline remains intact for Gold

• Gold – Inched lower as expected and almost hit the first support/target of 1260 (printed a low of 1263 in last Fri, 24 Oct U.S. session) before it staged a rebound to challenge the 1272 key short-term resistance (printed an intraday high of 1274 in last Fri, 24 Oct U.S. session before it retreated back below 1272 in today, 30 Oct Asian session). Tolerate the key short-term resistance excess to 1275 (minor descending trendline from 16 Oct 2017 high + former swing low of 23 Oct 2017) and maintain bearish bias for a potential extension of the corrective decline towards the 1260 support (minor swing low of 06 Oct 2017) follow by 1252 next (swing low area of 08 Aug 2017 + medium-term ascending trendline from 15 Dec 2016 low).
• WTI Crude (Dec 2017) – Rallied as expected and surpassed the resistance/target of 53.76 (printed a current intraday high of 54.18 in today, 30 Oct Asian session). Risk of short-term corrective decline at this juncture as it has started to retreat from the upper boundary of a minor ascending channel in place since 09 Oct 2017 low with extreme overbought readings seen in the hourly Stochastic & RSI  oscillators. Turn bearish below 54.18 key short-term resistance (close to 1.00 Fibonacci projection of rally from 09 Oct 2017 low to 16 Oct 2017 high projected from 20 Oct 2017 low) for a corrective decline towards the 52.87/52.60 intermediate supports (38.2%/50% Fibonacci retracement of the recent rally from 24 Oct low to 30 Oct’s Asian session high + former minor swing high area of 16 Oct 2017).

Stock Indices (CFD) – No signs of clear bullish exhaustion yet

• US SP 500  - Rise in progress as expected to print another fresh all-time high of 2583 in last Fri (27 Oct) U.S. session. Maintain bullish bias above tightened key short-term support now at 2570/65 (former minor swing high area of 26 Oct 2017 + minor ascending trendline from 26 Oct 2017 low) for a further potential push up towards the next intermediate resistances of 2590 follow by 2595 (1.618 Fibonacci projection of the up move from 26 Oct 2017 low, a minor degree bullish impulsive wave iii potential target).
• Japan 225 – No change, maintain bullish bias above 21755 key short-term support (congestion area of 26 Oct 2017 + minor ascending trendline from 19 Oct 2017 low) for a further potential up move to target the next resistances at 22315 follow by 22475 (lower limit of medium-term resistance, see weekly technical outlook).
• Hong Kong 50 – No change, maintain neutrality stance between prefer to turn neutral between 28000 & 28545 (“Head & Shoulders” invalidation level). Only an hourly close above 28545 shall validate a potential bullish exit towards 29100.
• ASX 200 – No change, maintain bullish bias above 5880 key short-term support for a further potential push up towards the intermediate resistance of 5950 (swing high areas of 12 Apr/01 May 2017) in the first step.
• Germany 30 – Risk of minor corrective decline still prevails towards the intermediate support of 13130 with a maximum limit set at the 13090/13050 key short-term support (former swing high area of 18 Oct 2017 + pull-back support of the  former minor descending range resistance from 18 Oct 2017 high) before another potential bullish impulsive upleg materialises to target the next intermediate resistance at 13355/370 (Fibonacci projection cluster).

*Levels are obtained from City Index Advantage TraderPro platform  

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