S&P appears to be reversing its recent contraction move,heading back to the 1700 territory as indicated by healthy RSI and MACD readings,while the index is trading again within the bollinger band limits.
Oil(WTI) has been consolidating above the crucial 103$ level since early July,having confirmed a reverse head&shoulders pattern that brought the price close to the 110$ level.An RSI reading slightly above 50 and MACD stabilizing above 0,support a continued consolidation scenario within the 103-107$ range.Geopolitical tensions in the Middle East will likely keep pressure on the price despite downward pressure from the fragile global economy,particularly in the stagnated Europe.
Gold maintains the weak momentum of a typical bear market rally that brought the price just below 1400$.To call the coveted metal’s bear market over will take much more than this though,even if some commentators and dedicated gold bugs have been doing so this past weeks.Should the price approach the 1500$ level and consolidate close to that price range,the ‘end of the bear market’ scenario will certainly gain merit.
S&P has managed to erase the losses of the May-June period and deviated outside of the bounds of its secondary upward channel yet again.It lies now very close to its all-time high of 1687.This is set to provide the strongest resistance as we move to next weeks’ trading session.RSI is close to the 70 mark but more significantly the price is moving beyond the upper part of the Bollinger Bands-past experience for the S&P indicates that a short-term correction should be expected.Whether this will come before a new all time high is set,is difficult to tell.
Oil(WTI) has confirmed the reverse head & shoulders pattern as predicted in our previous post a month ago,albeit not reaching the 110$ mark yet.It is likely that a healthy retreat and consolidation near the 103-106$ price range will occur.An RSI reading above 70 and an equally high reading of the MACD support this scenario,but setting aside the technicals,geopolitical tensions in the Middle East and the problematic outlook of the global economy as portrayed in the latest report of the IMF,complicate the picture.