1 Aug: Forecast: Stock Indices, Commodities

By | August 1, 2017


S&P: 2468
24 Hour: Neutral Medium Term: Neutral
No change in view. The S+P traded a tight 2465/75 range on Monday.

As before, with the daily momentum indicators still pointing higher, further gains would seem possible in the days ahead, although the short term charts are flat on Tuesday so another rangebound session could lie ahead and progress, if any, may be slow.

As before, I prefer to remain sidelined at these levels.

Preferred Strategy: Neutral

Resistance Support
2490 Minor 2465 Session low
2485 Minor 2461 Friday low
2480 Minor 2456 27 July low
2480 27 July high  -All-time high 2457 19 July low
2474 Session high 2447 18 July low/(23.6% of 2345/2475)

DJI: 21859
24 Hour: Neutral Medium Term: Neutral
The DJI reached a new all time high on Monday of 21875 (21747/21875), underpinned by Boeing shares, and closed right at the peak, suggesting that the trend will continue. As we said yesterday though, some caution is warranted as the S+P will need to play catch-up in order for the uptrend to continue. With the momentum indicators generally looking constructive though, a move towards 22000 does seem likely. Stops should be placed  at around 21700 or ideally, tight below the trend support, currently at 21550

Preferred Strategy: Neutral

Resistance Support
22050 Minor 21875 Session low
22000 Minor 21682 Friday low
21950 Minor 21631 27 July low
21900 Minor 21550 Rising trend support

ASX SPI: 5663
24 Hour: Neutral Medium Term: Neutral
The choppy, sideways trade continues – today trading 5635/5685.

As we said before, the momentum indicators still look pretty neutral and the chart looks a complete mess (unless you are a mean reversion trader, in which case it is fantastic!) so I would not be too involved right now. More of the same looks likely and the range of 5600/5765 look set to cover it in the medium term.

Resistance Support
5765 100 DMA 5650 200 DMA
5747 4 July high 5635/30 Session low /Friday low
5707 Friday high 5610 Minor
5685 Session high /100 HMA 5592 24 July low/(38.2% of 5029/5944)
5675 200 HMA 5550 Minor

XAUUSD: 1269
24 Hour: Prefer to buy dips Medium Term: Mildly Bullish
Gold had a tight session (1265/71), leaving the outlook unchanged.

As before, the daily momentum indicators point higher, and we could now see a run towards 1275/80 if the dollar remains under pressure,  which should see good selling interest but above which would open the way to the previous, June high of 1296.

On the downside, the initial support now lies at 1260 (minor) ahead of the rising trend support at 1253 and then at 1243/45 and again at 1235, which should be strong although looking increasingly distant.

Preferred Strategy: Looking to buy at around 1260, with a SL placed under 1250 or 1245, would seem to be the plan, looking for a run towards 1290/95, although 1280 may be tough to take out so some caution is needed.

Resistance Support
1296 6 June high 1265 Minor
1290 Minor 1257/54 Friday low/(23.6% of 1205/1270)
1280 Descending trend resistance /14 June high 1253 Rising trend support
1275 (76.4% of 1295/1208) 1245/43 (38.2% of 1205/1270)26 July low
1271/70 Session high/Friday high 1237 (50% of 1205/1270)

XAGUSD: 16.81
24 Hour: Prefer to buy dips Medium Term: Prefer to buy dips
Silver played catch-up with Gold on Monday, reaching 12.87 and closing nearby.

With the dailies still pointing mildly higher, if 16.90 can be taken out we could be in for a run towards 17.00 /17.10, which should be good resistance, and further progress, towards 17.35, will depend on the direction of the dollar.

The short term momentum indicators look a little flat, and if we fail to make progress, then on the downside the initial support arrives at 16.65 and again at 16.45/55. A break of this could quickly lead back below 16.25/30 towards 16.05/10, and then below 16.00, to 15.85/95.

Preferred Strategy: Prefer to buy dips while above 16.60 but with a tight stop loss placed under 16.45, but looking for a run towards 17.00/10 and possibly higher.

Resistance Support
17.36 14 June high 16.67 Session low / Rising trend support
17.08/10 15 June high/200 DMA 16.52 Friday low
17.00 100 DMA 16.45 (23.6% of 15.18/16.87)
16.90 (50% of 18.65/15.18)/29 June high 16.30 26 July low
16.87 Session high 16.20 (38.2% of 15.18/16.87)

WTI: 50.15
24 Hour: Prefer to buy dips Medium Term: Prefer to buy dips
WTI settled higher on Monday (50.20), underpinned by news of a producers’ meeting slated for next week and possible sanctions from the U.S against Venezuela, an OPEC member.

WTI reached a peak of 50.38 on Monday before finishing right on the Fibo level at 50.20, but the momentum indicators still looks positive and there is now very little to stop the price climbing quickly to 51.00, which should be strong resistance, but beyond there, to the next Fibo level and previous trend high at 52.00.

On the downside, minor support now lies at 50.00 and then again at the 200 DMA (49.40), below which could see a run back towards Friday’s low at 48.84 and then possibly to 48.00 although that now looks rather distant.

Preferred Strategy: For Tuesday, I prefer to buy dips towards the 200 DMA (49.40), with a SL placed below 48.80, but looking for a run towards 51.00.

Resistance Support
51.97/52.05 25 May high/(76.4% of 55.21/42.03) 49.40 200 DMA
51.00 Descending trend resistance 49.16 Session low
50.70 Minor 48.84 Friday low
50.38 Session high 48.40 (23.6% of 42.02/50.38)
50.20 (61.8% of 55.21/42.03) 47.85/92 26 July low /100 DMA