7 Aug: Forecast: Stock Indices, Commodities

By | August 7, 2017


S&P: 2471
24 Hour: Neutral Medium Term: Neutral
No change in view. The S+P traded another tight 2465/75 range on Friday, unmoved by the NFP figure.

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 31 July 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 2467 Friday low
2485 Minor 2461 28 July low
2480 Minor 2456 27 July low
2480 27 July high  -All-time high 2457 19 July low
2477 Friday high 2447 18 July low/(23.6% of 2345/2475)

DJI: 22017
24 Hour: Neutral Medium Term: Neutral
The DJI CFD reached yet another new all time high on Friday of 22044 (21955/22044) and closed nearby, suggesting that the trend will continue. As we said before though, some caution is warranted as the S+P will need to play catch-up in order for the uptrend to continue.  As before, I prefer to remain on the sidelines.

Preferred Strategy: Neutral

Resistance Support
22200 Minor 21955 Friday low
22150 Minor 21858 1 Aug low
22100 Minor 21682 28 July low
22050 Minor 21631 27 July low
22044 Friday high  – all-time high 21550 Rising trend support

ASX SPI: 5683
24 Hour: Neutral Medium Term: Neutral
The choppy, sideways trade continues – Friday trading 5641/5683.

As we said before, the momentum indicators still look pretty neutral and the chart looks a complete mess 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 5670 Minor
5747 4 July high 5641 Friday low/3 Aug low
5727 1 Aug high 5630 28 July low
5692 3 Aug high 5592 24 July low/(38.2% of 5029/5944)
5683 Friday high 5580 Minor

XAUUSD: 1259
24 Hour: Prefer to sell rallies Medium Term: Prefer to sell rallies
Gold fell sharply on Friday, from 1270 to 1254, in line with the stronger US$.

Further losses look possible, and on the downside good support lies right here at 1250/55, which may hold it up for a while a break of which would allow a move to and then at 1243/45 and again at 1235.

On the topside, resistance will be seen at 1265 and again at 1270 although I don’t think we see it again today. If wrong, the descending trend resistance at 1280 should provide a decent cap.

Preferred Strategy: Further losses look likely so selling rallies, with a SL placed above 1265, if favoured.

Resistance Support
1296 6 June high 1257/54/52 (23.6% of 1205/1270) /Friday low / Rising trend support/ 100 DMA
1280 Descending trend resistance /14 June high 1245/43 (38.2% of 1205/1270)/26 July low
1275 (76.4% of 1295/1208) 1237 (50% of 1205/1270)
1270 Friday high 1229 (61.8% of 1205/1270)
1263 200 HMA 1220 (76.4% of 1205/1270)

XAGUSD: 16.23
24 Hour: Prefer to sell rallies Medium Term: Neutral
As with Gold, Silver fell sharply on Friday, from 16.75 to 16.20, closing near the lows and hinting at further losses ahead.

The short term momentum indicators point lower, and on the downside the initial support arrives at Friday’s low at 16.20, a break of which could quickly lead back towards 16.00/05, and then below 16.00, to 15.80/85.

The dailies are actually flat on Monday so it could be that we chop around near current levels. If we do see a squeeze higher, the 16.45/50 would see sellers ahead o f 16.70 although I don’t think we get there today.

Preferred Strategy: Neutral. Possible sell rallies near 16.50 with a SL above 16.70.

Resistance Support
17.08/10 15 June high/200 DMA 16.20 (38.2% of 15.18/16.87) /Friday low
17.00 100 DMA 16.13 20 July low
16.90 (50% of 18.65/15.18)/29 June high 16.02 (50% of 15.18/16.87)
16.70 3 Aug high 15.83 (61.8% of 15.18/16.87)
16.50 Minor 15.60 (76.4% of 15.18/16.87)

WTI: 49.49
24 Hour: Neutral Medium Term: Neutral
WTI settled higher on Friday, capping off a volatile week amid renewed concerns over OPEC’s compliance with the deal to curb production. OPEC and non-OPEC members will meet in Abu Dhabi on Aug 7-8 to discuss ways to boost compliance with their supply reduction agreement.

The short term momentum indicators look rather flat on Monday and we could well just chop around near current levels. On the downside, support will arrive at 49.00 ahead of Friday’s low of 4848. Further buyers will arrive on an approach to 48.00 and again at 47.85. Below this though, there is little to support the price until 47.15.

On the topside, the 200 DMA will act as a magnate ahead of the 3 Aug high of 49.93. Beyond that could see a return to the recent high at 50.40 and then to 50.80 although this seems unlikely today

Preferred Strategy: Neutral.

Resistance Support
50.80 Descending trend resistance 49.00 200 HMA
50.40 1 Aug high 48.48 Friday low
50.20 (61.8% of 55.21/42.03) 48.40/34 (23.6% of 42.02/50.40)/1 Aug low
49.93 3 Aug high 47.85/92 26 July low /100 DMA
49.40 200 DMA 47.15 (23.6% of 42.02/50.40)