Technical Analysis 15-02-2017
By Antonis Vasloos
The euro plunged below 1.0600 U.S. on Tuesday and was on track for its lowest settlement in a month, as the common currency resumed its downtrend against the dollar. The EUR/USD was trading at 1.0572 overnight Wednesday, having declined nearly 200 pips over the past week. The pair is hovering at the lower end of the Bollinger Band, signaling renewed downward pressure.
- Support (daily): 1.0546, 1.0515, 1.0471
- Resistance (daily): 1.0621, 1.0665, 1.0696
The common currency is experiencing sharp downward momentum, as evidenced by the Relative Strength Index. A fall below the daily supports would likely push the EUR/USD into oversold levels, thus triggering a short-term buy signal.
Sterling fell to three-week lows versus the dollar on Tuesday, as the pair broke a major confluence of support that has withstood bearish pressure in recent weeks. The GBP/USD settled at 1.2457, where it was trading below the 20-day simple moving average. The pair is hovering just above the 100-day SMA, and a break below that level would expose it to a renewed downtrend.
- Support (daily): 1.2424, 1.2377, 1.2314
- Resistance (daily): 1.2534, 1.597, 1.2644
The pound remains neutral, but is losing momentum at an accelerated pace. The MACD is moving sharply lower, a sign that an imminent reversal may be nearing.
Crude oil posted a modest rally on Tuesday, as the market continued to search for direction. The West Texas Intermediate (WTI) benchmark for U.S. crude futures rose 27 cents, or 0.5%, to $53.20 a barrel on Tuesday after plunging nearly 2% at the start of the week. With the decline, WTI drifted slightly below its 20-day simple moving average.
- Support (daily): $52.80, $52.40, $51.94
- Resistance (daily): $53.66, $54.12, $54.52
The futures contract continues to trade in a predictable range between $51.00 and $54.00 a barrel. Short-term momentum indicators continue to show a neutral outlook
Gold edged higher on Tuesday, snapping a three-day losing streak that pulled prices below overbought levels. Demand for bullion softened in recent sessions on short-selling and a rebounding U.S. dollar. However, the divergence between gold and the dollar has been less pronounced in recent weeks, signaling strong support for the yellow metal.
- Support (daily): $1,219.50, $1,215.10, $1,208.10
- Resistance (daily): $1,230:90, $1,237.90, $1,242.30
Active gold contracts have increased sharply since mid-January, right around the time bullion was entering a bullish phase. With its recent string of losses, gold has moved back toward the middle of the Bollinger Bands after triggering an overbought signal last week.