Intraday Market Analysis – Corrective Action

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EURUSD may give up February gains

eurusd

The greenback’s safe-haven status and the economic recovery are working in tandem to lift the dollar back from the abyss.

Friday’s bearish MA cross after an overbought RSI indication was a warning sign of the over-extension. The reversal was confirmed by the invalidation of a three-week-long trendline.

1.2020 is the intermediate support, but a failure to rally back above 1.2140 would mean that the true support lies near the daily level of 1.1950.

S&P 500 aims for daily support

spx500

Fear of reflation has only started what seems to be a necessary correction given stocks’ wild valuation in recent months.

An RSI divergence, coupled with a bearish MA cross,  signaled that price action was heading south. The psychological level of 3700 acts as a key daily support as the bearish momentum may accelerate after a brief consolidation.

The area between the moving averages and 3870 would be a supply zone in case of a rebound.

WTI hovers under pre-pandemic resistance

wti crude oil

A surprise buildup in US inventories raises oversupply concerns.

An RSI divergence reflected trader caution where the indicator’s failure to follow up with a higher high indicated a loss in the upward momentum, a prelude for a potential reversal.

As the price dips into the oversold territory, 61.00 could see buying interests. Its breach, however, could lead to a sell-off towards 59.50.

On the upside, the price will need to climb back to 63.00 to break the resistance.

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