Oil bulls had to show a lot of patience in the past few weeks, but WTI is finally showing some signs of a recovery. The positive RSI divergence on the Daily chart and broadly oversold conditions suggest an upside correction could follow in the near-term. The next notable resistance level lies around $54.50, giving WTI enough room for a decent recovery.
One currency benefiting from the rising Oil prices is the Canadian Dollar. Should the USD weakness persist as well, USD/CAD could come under even stronger pressure. The Daily chart suggests traders should keep an eye on the 50 % Fibo of the October - December rally. A clear break beneath that level could signal that further losses lie ahead.
Demand for Gold has surged in the past few weeks, as markets drifted into a risk-off environment. While XAU/USD appears to be slightly overbought in the short-term, the uptrend still looks healthy and the high levels of volatility and uncertainty in markets could keep the precious metal bid in the near-term. The next interesting level to watch to the downside is $1273 - which is the 38.2 % Fibo of the Dec-Jan rally.
The S&P 500 managed to recover from the Christmas sell-off. However, it remains to be seen if the rally is sustainable. Heavy resistance can be expected in the area between 2590 and 2600 points. A clear break above that area would give bulls some confidence and possibly pave the way for a recovery towards 2800 points. Should the S&P 500 fail there, selling pressure might intensify again.
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Soaring US yields trigger the wrecking ball effect as yields become a source of volatility for risk, rather than a source of support