Natural Gas melts down as traders await trade figures and UK news

Stocks, commodities and currencies have been holding steady overnight‎. US index futures are down 0.1% while the FTSE and DAX are flat.

Currencies are holding steady against USD indicating Fed and political risk speculation has been fully priced in for now. GBP is underperforming slightly ahead of today’s Third Reading of the Brexit bill in the House of Lords plus tomorrow’s Spring Budget and soft UK same store sales.

Although the recent advance in stocks has slowed, so far indices have been pausing rather than selling off. This suggests that new capital coming in from the sidelines chasing the rally is still enough to offset profit-taking by earlier entrants for the time being.

In energy trading, WTI Crude oil is up 0.2% but Natural Gas has been slammed for a 2.2% loss. Another warm spell in consuming markets suggests that the end of a soft demand heating season could be arriving early in some areas.

Today traders may pay some attention to trade numbers for the US and Canada, plus China tonight, which could have political implications. Health Care stocks may also be active as traders soft out the winners and losers from the Republicans health care plan.

Chart Signals: Indices wobble but don’t break down

Signs of exhaustion continue to emerge in major US indices and the Germany 30 including overbought and falling RSI readings and round number resistance. So far, however, it appears that we may be entering another sideways consolidation phase rather than a big pullback.

North American and European Indices

US 30 is still stuck below 21,000 drifting down from 20,970 toward 20,940. RSI still overbought but rolling over indicates potential for a correction that could be signalled by a crossing under 70. Next potential support near 20,900 then 20,830.

US SPX 500 is still struggling with 2,400 resistance falling back toward 2,370 with next potential downside support near 2,350 then 2,315 a 23% retracement of the post-election uptrend. RSI falling back under 70 signals a correction starting as upward momentum weakens.

US NDAQ 100 is currently trending sideways between 5,315 and 5,400 but has a big uptrend support line test underway today near 5,350. RSI has already broken under 70 to signal a correction starting. Next downside support should these first two tests fail appears near 5,200 a round number and 23% retracement of the recent uptrend.

UK 100 remains stuck between 7,400 resistance and 7,330 initial support trading near 7,350. A negative RSI divergence indicates recent uptrend weakening. Next support in a correction possible near 7,230 where a 23% retracement and the 50-day average cluster.

Germany 30 is still sitting just below 12,000. It remains in an uptrend with support coming in at a higher low near 11,940 but Lower highs in the RSI indicate upward momentum continues to slow. Upward resistance in place near 12,065 then 12,100.

Commodities

Gold has resumed its downtrend with resistance falling from $1,236 through $1,230 and on toward $1,226. RSI under 50 and falling indicates downward pressure increasing but so far the price continues to hold above $1,218 a Fibonacci level and key point of support/resistance for the last two months. 

Crude Oil WTI is holding steady just above $53.00 and its 50-day average near $52.75. higher lows continue to form an ascending triangle below $54.00 with next resistance near $54.80. RSI bouncing between 40 and 60 indicates a sideways trend.

FX

US Dollar Index remains under accumulation, still forming an ascending triangle pattern below 102.00 with support rising from 101.20 toward 101.50. Rising RSI indicates increasing upward momentum. Next upside resistance possible near 102.25 then 103.00.

USDJPY is trading near 114.05 a Fibonacci level amid mixed signals. The pair recently broke out of a downtrend over 112.80 but so far advances have been contained by the 50-day average with additional resistance possible near 114.60 and 115.00. RSI bouncing around 50 indicates a sideways trend. 

EURUSD remains stuck in a sideways channel between $1.0500 and $1.0640, recently sliding back under $1.060 and $1.0580 toward $1.0575. RSI unable to retake 50 indicates this as a pause within an ongoing downtrend.

EURGBP is still trading near 0.8660 sending mixed signals. The pair appears to be peaking at a lower high but RSI indicates upward momentum still increasing. Next potential resistance possible near 0.8760 with next support at the 50-day average near 0.8550.

GBPUSD remains under pressure dropping from $1.2250 toward $1.2200 while falling RSI indicates increasing downward momentum. Next potential support in the $1.2080 to $1.2110 area where support could form the right shoulder of a head and shoulders base.

USDCAD has levelled off for now in the $1.3370 to $1.3440 range pausing to work off an overbought RSI. Next resistance possible near $1.3455 and $1.3500 with next potential support near $1.3325 and $1.3300.

CADUSD has paused in the $0.7440 to $0.7470 range but it remains in a downtrend below $0.7500 with next potential support at a Fibonacci cluster between $0.7380 and $0.7410.

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