4 July: Forecast: Stock Indices, Commodities

By | July 4, 2017

 

  • Commodities:
  • Gold fell heavily through 200 DMA and never recovered, falling $20 oz. Similarly, Silver was down by 3.1%
  • WTI was up for the 8th day in a row, +2% after data pointed to diminished U.S. output.
  • Stocks:
  • The DJI made a new all-time high but gave up its gains to leave stocks mixed on the day.
  • Economics/ Politics/Central Banks:
  • EU PMI manufacturing finalised at 57.4 in June, revised up from 57.3. UK PMI manufacturing dropped to 54.3 in June, down from 56.3 below expectation of 56.3.
  • US ISM June manufacturing index: 8 vs 55.2 expected.
  • US ISM Manufacturing Employment Index: Jun 57.2 vs 53.3 expectation, 53.5 prev
  • May Construction Spending 0.0% v expectations of +0.3%
  • US Holiday today.
S&P: 2424
  • Intraday (1 hour/4 hour) momentum indicators : Neutral
  • Daily momentum indicators are Turning lower
  • Upcoming market moving events ; US Holiday
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: The S+P traded a choppy range of 2421/2436 on Monday, but unlikely the DJI it did not make a new high and actually finished back towards the session lows. The mixed look of the short term momentum indicators suggest we are going to be in for more of the same ahead, but with Tuesday being a holiday I would stand aside.
Resistance Support
2455 Minor 2421 Session low
2450 20 June high  –All-time high 2414  29 June low
2447 26 June high 2402 31 May low /29 June low
2444 29 June high 2397 (50% of 2344/2450)
2436 Session high 2390 `Minor


DJI: 21422
  • Intraday (1 hour/4 hour) momentum indicators are Mixed.
  • Daily momentum indicators are Neutral
  • Upcoming market moving events: US Holiday.
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: The DJI did manage a new all-time high on Monday but is now back in the middle of its recent range. As with the S+P, stand aside on Tuesday
Resistance Support
21550 Minor 21307 Session low
21504 Session high  – all-time high 21260 (23.6% of 20474/21504)
21449 29 June high 21215 Rising trend support
21400 Minor 21137 29 June low
21365 29 June high 21110 (38.2% of 20474/21504)


ASX SPI: 5666
  • Intraday (1 hour/4 hour) momentum indicators : Mixed
  • Daily momentum indicators : Neutral
  • Upcoming market moving events Retail Sales, RBA Meeting
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: The ASX traded a range of 5630/82 on Tuesday and as before, it is currently trapped between the 100 DMA (5770) and the 200 DMA (5630), trading within those parameters pretty much since the end of May. The momentum indicators are generally mixed, so a nimble stance is required ahead of the RBA Meeting today. The 4 hour momentum indicators are neutral, possibly pointing a little lower, where 5630 would find good support if seen, below which could run towards 5600 although doubtful today. The dailies do not yet suggest a major run to the downside so it may well end up being a choppy session ahead. Overall I mildly prefer to sell into a squeeze back towards 5700, with a SL placed above 5715 but wait for the RBA.
Resistance Support
5771 (50% of 5944/5598)/100 DMA 5630 Session low
5750 Minor 5624 27 June low/200 DMA
5730 Minor 5597 21 June low
5700 Minor 5580 Minor
5682 Session high/(23.6% of xxxx) 5560 Minor


XAUUSD: 1220
  • Intraday (1 hour/4 hour) momentum indicators are Down – Becoming Oversold
  • Daily momentum indicators are Turning lower
  • Upcoming market moving events: US Holiday
24 Hour Outlook: Prefer to sell rallies Medium Term: Prefer to sell rallies
Preferred 24-hour Strategy:  Gold has fallen hard, to 1219, and with the momentum indicators generally aligning lower, looking for levels to sell it seems to be the plan. 1230/35 will now provide decent resistance, while support will be seen at 1210/15 and then again at 1195/00.
Resistance Support
1250 Pivot 1219 Session low
1242 Session high 1214 9 May low
1237  (23.6% of 1295/1219) 1208 (50% pivot of 1122/1295)
1234 200 DMA 1200 Pivot
1228 Minor 1195 10 March low


XAGUSD: 16.11
  • Intraday (1 hour/4 hour) momentum indicators ;Turning lower
  • Daily momentum indicators ; Neutral
  • Upcoming market moving events: US Holiday
24 Hour Outlook: Prefer to sell rallies Medium Term: Neutral
Preferred 24-hour Strategy: Silver followed Gold lower, and a stronger test of 16.00 looks likely, below which would open up 15.60/65.  Selling rallies is favoured, although it may be quiet day given the US holiday. Selling at 16.25 with a SL at 16.65 may be a plan.
Resistance Support
16.90 29 June high 16.10 Session low
16.70 29 June high 16.06 9 May low
16.58 100 WMA 15.85 Minor
16.45 Minor 15.63 20 Dec low
16.25 Minor 15.50 Minor


WTI: 47.02
  • Intraday (1 hour/4 hour) momentum indicators: Up – Becoming Overbought
  • Daily momentum indicators: Up
  • Upcoming market moving events API Weekly Crude Oil Stock Inventory
24 Hour Outlook: Prefer to buy dips Medium Term: Mildly Bullish
Preferred 24-hour Strategy: WTI headed up by another 2% on Monday, reaching 47.07, and with the momentum indicators looking positive, look for a move towards 47.85 and possibly on towards 48.15. On the downside, support will be seen at 46.50 (minor) and then 45.85 although this looks unlikely to be seen today. Trading from the long side is still preferred although the short term momentum indicators are becoming overstretched and we may see a bit of a dip, giving us a better level to get set. The API is scheduled, which if released may cause some volatility in very thin conditions.
Resistance Support
49.14 1 June high 46.50 Minor
48.60 Minor 45.85 (23.6% of 42.03/47.07)
48.15  (61.8% of 51.97/42.03) 45.50 Minor
47.85 (50% pivot of 53.73/42.03) 45.15 100 WMA /(38.2% of 42.03/47.07)
47.07 Session high 44.85 Minor