Summary:
- ITA40 is trading near an all-time high
- COFFEE faces the worst week in a long time
- Declines on AUDUSD stopped at key support level
ITA40
The positive sentiment can be seen all over the world with US indices trading at fresh records and other stock markets also doing well. Let’s look at the situation on the Italian index ITA40. The price is now trading at the key resistance zone which is marked with 2018 highs. In case of a break higher, the index may reach the 24460 pts handle, where all time high can be found. It also looks as a perfect place to start a downward correction. In such a scenario, the move may reach a support at 22800 pts handle. This level is marked with the lower limit of Overbalance structure, which is the range of the biggest downward move during upward impulse started in August 2019. One should also remember that the main trend remains upward therefore going short means going against the market.
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ITA40 D1 interval. Source: xStation5
COFFEE
Coffee can be found under selling pressure this week. Following a strong rally sellers took over at 143.00 handle, which is the key resistance marked with price reactions from August 2017. Commodity has declined over 7% this week. The nearest support to watch can be found at 113.00, where the highs from June 2019 are located. In case declines continue to deepen, the next support in line can be found at 106.00 handle.
COFFEE W1 interval. Source: xStation5
AUDUSD
Last but not least, let’s take a look at AUDUSD. The pair reached key support this week. The area at 0.6850 handle is marked with the lower limit of Overbalance structure (yellow rectangles) and the 50% Fibonnaci retracement of the upward swing started in October 2019. As long as the price sits above it, bulls seem to be in markets’ favour. The nearest resistance to watch is the 0.6930 handle and it is marked with previous price reaction. In case of a break higher, the upward move could accelerate and reach late-2019. On the other hand, a break below the aforementioned support at 0.6850, could facilitate an attack on the zone at 0.6755 handle.
AUDUSD D1 interval. Source: xStation5
