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Weekly Preview: Technical analysis on USDJPY, GBPUSD, USDCNH, XAUUSD, WTI, SPX

Market Analysis / 3 Min Read
Desmond Leong / 04 May 2020
View of skyline on cloudy night with chart

Weekly Preview: Technical analysis on USDJPY, GBPUSD, USDCNH, XAUUSD, WTI, SPX

This week, the market's risk appetite was revived as investors grew optimistic around the easing of lockdowns in many countries, along with renewed hopes of finding a potential drug treatment in the fight against the Covid-19. Meanwhile, the Dollar continued on its downward trend after the U.S. Federal Reserve left the door open to further monetary easing and dampened expectations of a quick economic recovery from the coronavirus pandemic. Looking at the charts, SPX edged higher this week while crude oil recovered from its recent trough. Elsewhere, Gold stabilized as it capitalized on improving market risk sentiment as Gilead announced that its experimental drug helped to speed up the recovery process of Covid-19 patients. 

CURRENCY: USDJPY

Chart by TradingView.com

Price is approaching 1st support at 106.42. Price is facing bullish pressure from 1st support where we remain bullish above this level. The 1st support level happens to where the horizontal swing low lines up with 61.8% fib extension. MACD shows that histogram start to print in green, indicating a possible bounce could occur from the support level. 

CURRENCY: GBPUSD

Chart by TradingView.com

Price is approaching our first resistance, in line with our 78.6% fibonacci extension and 61.8% fibonacci retracement where we remain bearish below this level and could see a further drop to our first support level.

CURRENCY: USDCNH

Chart by TradingView.com

Price is facing bullish pressure as it  went down to retest the 1st support where we remain bullish above this level. 1st support happens to be where the 78.6% fibonacci extension and horizontal swing low are. Ichimoku cloud is also showing a possible push down towards 1st support is likely. As China is the first country to resume normal work and life in the Covic-19 turmoil, CNH could likely see some upside.

CURRENCY: SPX

Chart by TradingView.com

Price is testing our first resistance level in line with our 61.8% fibonacci retracement and horizontal overlap resistance, where we could see a reversal below this level. A break below our first support level could provide a bearish acceleration to our second support level.

CURRENCY: XAUUSD

Chart by TradingView.com

As expected, Gold drifted lower at the start of the week. However it failed to make any convincing break of previous supports. Towards the end of the week, Gold drifted sideways. Price is currently holding between 1st resistance and 1st support. The indecision of Gold prices this week shows that market participants are still cautious about the further rise of the S&P index. Watch 1st resistance and 1st support closely. A break of either of this level is bound to bring along with it huge moves.

CURRENCY: WTIUSD (USOIL)

Chart by TradingView.com

As expected, by the middle of this week, oil price drifted lower and reached our previous support that was highlighted. Towards the end of this week, oil prices drifted higher as OPEC started production cuts. However the bullish move from oil was less than convincing as the cut by OPEC was seen as ‘too little, too late’. Oil price is still holding below a descending trendline resistance. However given the mixed indicators, we prefer to keep a neutral stance on oil, watching 1st resistance and 1st support. A break of 1st resistance should see oil price recovering further. Otherwise, a break below 1st support should see oil price drop lower.

The information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.

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