Daily Key Short Term Technical Levels Mon 04 Dec 2017

FX – USD remains below resistance & tolerate the excess in USD/JPY

• EUR/USD – No change, maintain bullish bias above 1.1850/1827 key short-term support for another round of potential upleg to target the next intermediate resistance at 1.2000 in the first step follow by the 1.2070/2090 (swing high area of 08 Sep 2017 + upper boundary of the minor ascending channel in place since 07 Nov 2017 low).
• GBP/USD – Recalled  that last Fri, we turned neutral between 1.3660 & 1.3430 due to a risk of a minor pull-back below 1.3600. The pair has shaped the expected minor pull-back to print a current intraday low of 1.3438 in today (04 Dec) Asians session (close to the lower boundary of last Fri neutrality zone of 1.3430).  The hourly Stochastic oscillator has shaped a bullish divergence signal at its oversold region which suggests a slow-down in the downside momentum of last Fri’s slide. Therefore, another potential upleg may have materialised  within this on-going short-term uptrend in place since 03 Nov 2017 low. Flip back to bullish bias above 1.3375 key short-term support (former minor swing high areas of 27/29 Nov 2017 + Fibonacci cluster) for a potential push up to retest 1.3660 (medium-term swing high of 20 Sep 2017).
• AUD/USD – Cleared above the 0.7595 upper neutrality zone during last Fri (01 Dec) U.S. session. Interestingly, in today (04 Dec)  Asian session, the pair gapped down (in reaction to U.S. Senate approval on its version of the tax reform plan) to retest 0.7595 before it shaped a rebound from it (printed an current intraday low of  0.7587). Flip back to bullish bias above 0.7595/87 key short-term support to see the start of another potential upleg to target the next intermediate resistance at 0.7660/7670.
• NZD/USD – Rise in progress as expected. No change, maintain bullish bias above 0.6820 key short-term support for another round of potential upleg to target the intermediate resistances of 0.6930 before 0.6960 (08 Nov 2017 swing high area + 23.6% Fibonacci retracement of the multi-month decline from 27 Jul 2017 high to 17 Nov 2017 low).
• USD/JPY – Challenged the 112.70 key medium-term resistance on last Friday (01 Dec) U.S. session where it printed a high of112.87 before it plunged down to a session low of 111.41 but no hourly close below 111.60 (downside trigger level as per highlighted in previous report). In today (04 Dec) Asian session, it gapped up (in reaction to U.S. Senate approval on its version of the tax reform plan) to print a current intraday high of 112.89. The 4 hour Stochastic oscillator has continued to shape a bearish divergence signal which indicates the risk of a slow-down in upside momentum of today’s push up in price action. Maintain bearish bias and tolerate the excess to 112.90 with 111.60 remains as the downside trigger level where an  hourly close below 111.60 is required to increase the odds of the start of another potential downleg to target the next intermediate support at 110.60/50 (former medium-term range resistance of 16/31 Aug 2017 + Fibonacci projection cluster).

 Commodities – Gold remains above range support

• Gold – No change, maintain bullish bias above 1265 range support in place since 06 Oct 2017 for a potential push up towards the range resistance of 1290/98.
• WTI Crude (Jan 2018) – Whipsawed around the 58.35 short-term resistance with mix elements. Prefer to turn neutral now between 59.00 (25 Nov 2017 swing high) & 56.80 (30 Nov 2017 minor swing low).

Stock Indices (CFD) – Mix bag

• US SP 500 – Last Friday (04 Dec) in the U.S. session, the Index has staged a breakdown below the 2633 lower limit of the neutrality zone and within one hour it plunged straight to hit the 2608 support (minor ascending channel support from 15 Nov 2017 low) as reinforced by negative political news where former U.S. National Security Adviser Michael Flynn stated that President Trump directed him to make contacts with the Russians where Russian authorities are suspected in the meddling of the recent U.S. Presidential Election in favour of Trump. In today’s Asian session (04 Dec), the Index gapped up to print another fresh all-time high of 2663 in a positive reaction the U.S. Senate approval on its version of the tax reform plan. Interestingly, the current rally from last Friday (01 Dec) U.S. session low of 2604 has met the minimum intermediate degree bullish impulsive 5th wave sequence target of 2668/83 in place since 21 Aug 2017 low. Thus based on Elliot Wave/fractal analysis, the Index now faces the risk of a multi-week corrective decline/consolidation to retrace the aforementioned up move since 21 Aug 2017 low. Mix technical elements as markets  grapple with both negative & positive political events from U.S. Do expect wild ride, thus prefer to turn neutral now between 2683 & 2644 (today’s Asian session gapped up).
• Nikkei 225 – No change, maintain bearish bias below 23010 key medium-term resistance with 22500 as the downside trigger level (last Fri, 01 Dec U.S session swing low area + minor ascending trendline from 15 Nov 2017 low) and an hourly close below 22500 is likely to increase the odds of another corrective downleg to retest the 21830 minor swing low area of 15 Nov 2017.
• Hong Kong 50 – Inched lower during last Fri (01 Dec) U.S session to test the medium-term ascending channel support at 28870 in place since 04 Jul 2017 low before it staged a rebound in today (04 Dec) Asian session. Interestingly, the 4 hour Stochastic oscillator has shaped a bullish divergence signal which indicates a slow-down in the downside momentum of the recent slide. Therefore, the Index may see a recovery (start of a new bullish impulsive wave sequence at this juncture). Flip back to bullish bias above 28870 support with 29600 as the upside trigger level (minor descending trendline in place since 21 Nov 2017 high + close to 50% Fibonacci retracement of the recent slide from 21 Nov high to 01 Dec 2017 low). An hourly close above 29600 is likely to increase the odds of another potential upleg to retest the recent swing high of 30200 in the first step.
• Australia 200 –  No change, maintain bearish bias below the 6013/6033 (excess) key medium-term resistance and an hourly close below 5950 is required to validate another potential leg of corrective decline towards the next intermediate support at 5900.
• Germany 30 – Plunged as expected below the 13220 key medium-term resistance towards the 12847 downside trigger level (to print a low of 12811 on last Fri, 01 Dec European session before it rebounded again ). No change, maintain bearish bias below 13220 key medium-term resistance with adjusted downside trigger level at 12800 (to take into account of last Fri’s price action). An hourly close below 12800 is likely to open up scope for another potential multi-week corrective decline to target the next intermediate support at 12720/700 in the first step.  

*Levels are obtained from City Index Advantage TraderPro platform

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