WTI bears have struck again, sending the price of oil to the psychological 47.0 level. There have been various expectations of a potential bullish correction with prices at least trading back above the 62.0 resistance, but global events make this currently unachievable. The many factors such as the slowdown in China, glut of supply from Iran and ever increasing US Dollar have capped any attempts by the bulls.
The FTSE100 has felt the spin-off effect from this, with bears taking this indice back to the 6500 support. The falling oil prices, dollar strength and strong pound have all been factors which have mitigated bulls from taking the driving seat once more. If prices breach the 6500 support, then we may simply see levels unheard from since 2014.
Today the focus will be on the USD and GBP. Prelim GBP estimates q/q will be released shortly. Predications stand at 0.7% from the previous 0.4%. A positive result should give a slight kick to the FTSE and other GBP orientated pairs, investor sentiment still remains bullish on the GBP post-Carney statement. Another batch of consumer confidence for the States will be released this afternoon. The sentiment for the dollar is already bullish, but this result will further tick the boxes for the impending rate hike sometime this year. The forecast stands at 100.1, so we should be expecting figures which match the forecast or higher.
The technical levels for today may be viewed below.
WTI remains heavily bearish. Many bearish factors are stacked up against it and until they change, there may simply be a further decline to the next relevant support which was the 42.00, the lows of March 2015. The daily indicators suggest everything point to the downside. Prices reside below the weekly and monthly pivot with the MACD trading to the downside. 49.00 is the daily trend defining level and the start of the 3 black crows candlestick formation. A solid move below 47.0 may be expected or a slight correction before the decline.
Intraday – Lower lows and lower highs can be observed on the hourly timeframe. Prices currently reside below the daily pivot and hourly 20 SMA. It will be beneficial for the bears to keep below the 47.30 to warrant a further decline to the daily S1 of 46.50. An incline and hourly close above 47.80 invalidates this intraday bearish view.
FTSE experienced 5 solid days of decline from the 6.800 level. Day 2-5 printed the 3 black crows candlestick formation in addition to breaching the daily 20 SMA. With the MACD to the downside and prices below the monthly and weekly pivot, the final step may be for a breakdown below the 6500 support. If this is achieved, bears may take prices to the 6350 level.
Intraday – A sharp incline was experienced from the 6500 supportive regions. Intraday prices have breached past the daily pivot and the MACD has crossed to the upside. The previous lower high of 6588 signifies this that is still a downtrend. As long as we keep below this level prices may simply trade back to the 6500 regions. On the flip side, if the daily support holds then a further incline to the daily R1 of 6560 may be expected before prices consolidate once more.
Gold has taken a beaten. This is still bearish both fundamentally and technically. There seems to be resistance at 1110.0 and some light support just below 1090.0. This week is clustered with data from the US. A green week for the dollar will be another red week for Gold. Currently, prices are finding some resistance below the weekly pivot just around 1100. Data later this evening may add some more volatility.
Intraday – Intraday is somewhat flat. Prices are sticky around the daily pivotal areas. There is some light support at 1092 and resistance at 1097. The best strategy may be to wait for a breakout post-consumer confidence release this afternoon.
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