The S&P 500 had an impressive recovery since the beginning of the year, if we take into consideration that there have been no proper updates about the US-China trade talks and recent economic data & earnings figures failed to meet expectations. The index cleared an important obstacle at 2600 points, but it remains to be seen if it can sustain momentum. Traders will be watching the falling trendline from the October high, which should represent the next heavy area of resistance. To the downside, it is crucial for S&P 500 bulls that the 2600 support level remains intact.
Gold has been consolidating in the past days, amid subdued volatility in the FX market. Support at $1275 has held so far, but the charts suggest XAU/USD might be slightly overbought in the near-term. A clear break below the support area between $1270-75 would pave the way for a deeper correction, with $1244/$1250 the next important area of support.
USD/CAD managed to advance recently, despite the poor USD performance and rising Oil prices. The sharp decline could have sparked some profit-taking from CAD longs. However, the recovery rally looks fragile and the Daily chart does not show oversold conditions. The level to watch is the 50 % Fibo of the October-December rally. Should USD/CAD decline back beneath that line, selling pressure may intensify.
EUR/GBP is sending mixed signals. The positive RSI divergence on the Daily chart suggests that the currency pair could recover after the sharp decline earlier this month. However, resistance ahead of the 0.8880 level (50 % Fibo of the November-December rally) will not be easy to clear, and there is no underlying trend that could support it.
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Equities hit with the inflation stick; Saudi assurance provides oil with shelter from the storm; USDJPY hedge plays building; Gold appears prone