Wednesday, October 3, 2012

must Ilya Spivak, Currency Strategist

US Dollar Grinds Higher as S&P 500 Lingers Despite Bullish Cues

By Ilya Spivak, Currency Strategist
03 October 2012 05:42 GMT
THE TAKEAWAY: The US Dollar continues to grind higher through near-term resistance levels as the S&P 500 follow-though proves lacking after prices produced signs of a rebound.

S&P 500 – Prices put in a Bullish Engulfing candlestick pattern above support at a rising trend line set from late July, hinting a move higher is ahead. Initial resistance lines up at 1466.10, with a break above that targeting the top of a channel established from the June 4 low at 1488.20. Alternatively, a break below trend line support (now at 1442.50) exposes 1422.40.

US_Dollar_Grinds_Higher_as_SP_500_Lingers_Despite_Bullish_Cues_body_Picture_5.png, US Dollar Grinds Higher as S&P 500 Lingers Despite Bullish Cues
Daily Chart - Created Using FXCM Marketscope 2.0



CRUDE OIL Prices bounced from support at 89.44, the 38.2% Fibonacci expansion, to challenge the 23.6% level at 93.60. A break above this barrier exposes the underside of a rising channel set from early July, now at 96.46. Alternatively, a reversal through support targets the 50% Fib at 86.04.

US_Dollar_Grinds_Higher_as_SP_500_Lingers_Despite_Bullish_Cues_body_Picture_6.png, US Dollar Grinds Higher as S&P 500 Lingers Despite Bullish Cues
Daily Chart - Created Using FXCM Marketscope 2.0



GOLD Prices remain range-bound above a falling trend line connecting major swing highs since early November 2011 (1746.79). Near-term resistance is at 1790.55-1802.80 area, with a break above that exposing 1850.00 and the 1900.00 figure. Support is reinforced by the 23.6% Fibonacci retracement at 1737.59, with a push below that targeting the 38.2% and 50% Fibonacci retracements at 1704.25 and 1677.30 respectively.

US_Dollar_Grinds_Higher_as_SP_500_Lingers_Despite_Bullish_Cues_body_Picture_7.png, US Dollar Grinds Higher as S&P 500 Lingers Despite Bullish Cues
Daily Chart - Created Using FXCM Marketscope 2.0



US DOLLAR Prices are testing through resistance at 9893, the 50% Fibonacci retracement level, to challenge the top of a rising channel set from the September 14 swing low (9905). A break above this boundary exposes the 61.8% Fib at 9929. Initial support lines up at 9857, the 38.2% retracement.

US_Dollar_Grinds_Higher_as_SP_500_Lingers_Despite_Bullish_Cues_body_Picture_8.png, US Dollar Grinds Higher as S&P 500 Lingers Despite Bullish Cues
Daily Chart - Created Using FXCM Marketscope 2.0



--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

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