Global equities managed to get some relief after the historic decision by OPEC and Non-OPEC member to oil production by almost 2 Million Barrels a day. However, that trend did not continue for a long time, US, Europe, and Asian equities took another hit today ahead of another key economic release from the US today. In this article, we will look at some of the major indices ahead of the weekend, possible trends and which levels to watch.
S&P500 Below 2200
After touching a new record high at the end of last week trading at 2213, the S&P500 index managed to retrace all the way back below 2200 reaching as low as 2185 until this report Is released, ahead of the US session today. However, such decline is still considered as a short term retracement. Moreover, traders need to be very careful as the correlation between the US equities, and the US Dollar remains very positive, which as some point needs to get back to normal (inverse correlation).
In the meantime, looking at the technical outlook, the index is testing a solid support at 2186, which held as a resistance throughout 2016, until the US elections, which led to a massive rally after a notable drop, leading the index to spike to a record high. Meanwhile, a weekly close below that solid support would increase the chances for further declines ahead, probably toward 2165 ahead of the Federal Reserve decision this month.
Levels To Watch
| S3 | S2 | S1 | Pivot | R1 | R2 | R3 |
| 2178.43 | 2188.62 | 2193.72 | 2203.91 | 2209.01 | 2219.20 | 2224.30 |
DAX30 Below 10500
DAX30 Index has been on our radar for more than 3 weeks now, in our previous article, we mentioned that the index is facing a strong resistance around 10750 which remained solid since August of this year, forming 4 tops on the daily chart, with a clear failure to break above that resistance. Such failure has led to a notable decline over the past seven sessions, reaching as low as 10430 until this report is released. Such decline confirms the upcoming leg lower. However, there are still some levels to be watched carefully over the coming days. Yet, the general outlook remains bearish.
For the time being, traders needs to be very cautious from any comments from the ECB, as there are talks that the bank will announce an extension of the current QE program for another 6 months in its upcoming decision in December. If so, the index might get some buying spree and may retest 10750 resistance area again. However, for the time being, the outlook remains bearish as long as it stays below that resistance. On the downside view, the first immediate support stands at 10400 followed by10370.
Levels To Watch
| S3 | S2 | S1 | Pivot | R1 | R2 | R3 |
| 10357.46 | 10430.00 | 10482.02 | 10554.56 | 10606.58 | 10679.12 | 10731.14 |
FTSE100 Potential H&S Formation
For the past few weeks, there has been a notable inverse correlation between FTSE100 and GBPUSD. Weaker GBP has led to a notable rally in FTSE all the way to 7129 levels. Things has changed since then, the announcement of the government budget in addition to the negotiations toward a soft Brexit has led to a notable recovery in GBP. In return, FTSE100 erased some of its gains and dropped all the way back below 6700 today, reaching as low as 6690 until this report is released.
In the meantime, there is a potential head and shoulder formation on the daily chart, which should be watched very carefully, as if this formation is completed, the index might face a notable selloff back below 6500. The immediate support stands at 6640, which seen as the key where buyers are likely to appear. Otherwise, we will be looking for another leg lower below 6500 in the coming weeks.
Levels to Watch
| S3 | S2 | S1 | Pivot | R1 | R2 | R3 |
| 6596.91 | 6642.66 | 6697.80 | 6743.55 | 6798.69 | 6844.44 | 6899.58 |
