- US30 recovers from recent declines
- GBPUSD struggles with 1.30 USD handle
- OIL.WTI rebounds from key support zone at $51
US30
Let’s start today’s analysis with the US stock market index - Dow Jones (US30). The index launched the week with a bearish gap as investors were concerned over the spread of the Chinese virus. Buyers managed to stop declines at the lower limit of local 1:1 structure at 28460 pts handle. A bullish engulfing pattern was painted yesterday suggesting that the upward move may be looming. Potential break back below the aforementioned 28460 pts may be considered a sell signal. In such a scenario, the next support to watch can be found at 27740 pts. This place is marked with the lower limit of Overbalance structure and the 38.2% Fibonacci retracement of the upward move started in August 2019.
US30 D1 interval. Source: xStation5
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Switching our focus to the FX market, let’s take a look at the GBPUSD chart. The pair is once again testing the key support zone at psychological 1.30 level. As long as the price sits above this area the buyers seem to be in advantage. The bullish scenario is also supported by the fact that the price is bouncing off the earlier broken trendline. On the other hand, a break below the aforementioned support at 1.30, could pave the way for a bigger downward move and 1.2780 handle could be at risk. However, the nearest support to watch lies at 1.29158, where the 38,2% Fibonacci retracement is located. One should remember that the volatility on the pair is likely to be elevated in the near-term due to Fed (today, 7:00 pm GMT) and BoE (tomorrow, 12:00 pm GMT) rate decisions.
GBPUSD D1 interval. Source: xStation5
OIL.WTI
Last but not least, let’s move to the oil market.The price of this commodity dropped almost 20% since high in early-January. However, looking at the daily time frame, the recent declines were halted at the lower limit of Overbalance structure. According to the methodology, this could be a good place to start recovery. Nevertheless, should bears remain in control, traders should focus on the key support at $51.
OIL.WTI D1 interval. Source: xStation5
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