Forex Trading Library

Intraday Analysis – Dow Jones may face correction

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GBPUSD seeks support

Cable stalled after Britain’s inflation and retail sales numbers fell sharply in November. The price is looking to consolidate its gains after lifting offers around 1.2730. As the RSI drops back from its double top in the overbought area 1.2600 near the 20-day SMA is the first level to expect trend-followers to stake in in the hope of a continuation. Further down, the previous swing low of 1.2500 is a critical level to safeguard the bullish impetus. For more conservative buyers, a clear cut above 1.2780 may extend gains towards 1.3000.

USOIL recoups losses

WTI crude settles higher amid fears of disruption as tensions rise in Yemeni waters. The price continues on its rebound trajectory from last June’s lows near 68.00. The bears’ profit-taking compounds opposite bargain hunting, helping the commodity claw back its December losses. 76.70 from a previously faded bounce is a key resistance ahead and its breach would reinforce the optimism and lay the foundation for a meaningful recovery above 80.00. On the downside, 72.30 is the immediate support in case of a fallback.

US 30 pulls lower

The Dow Jones 30 snaps back as investors bag profits going into Christmas. On the daily chart, the RSI is flirting with 90 suggesting an extremely overbought condition as the index breaks fresh record highs. 37640 has been established as a new milestone after bullish trend followers piled into a unidirectional market. However, sentiment may shift to a more cautious side as liquidity becomes thinner leading up to the festive season. Below 37160, 36550 over the 20-day SMA is an important level to test the bulls’ commitment.

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