US100
Let’s start today’s analysis with the US tech index - Nasdaq-100 (US100). Looking at the D1 interval, one can see that the downward correction deepened in the previous week. The price broke below the neckline of the head and shoulders formation (blue line) and according to the classic of technical analysis, a trend reversal is underway. Taking this into consideration, the bigger sell-off may be on the cards now. However, one can see that the downward move stopped at 14,450 pts support, which is marked with previous local low from 19th of July. Should sellers manage to break below it, the next key support to watch lies at 13,950 pts (previous price reactions and lower limit of 1:1 structure). On the other hand, if buyers manage to halt declines there, the 14,850 pts resistance may be the next target.
US100 D1 interval. Source: xStation5
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NATGAS managed to break above the 2014 highs today and briefly traded at levels not seen since 2008. Looking at the daily time frame, we can see that in spite of a downward correction, the main upward trend remains strong. Even if the current correction was to deepen, it should not threaten the underlying trend. The nearest key support to watch lies near the 5.65 and is marked with previous price reactions, 50% Fibonacci retracement as well as lower limit of 1:1 structure. Should we see a price drop below this support, market bulls could find themselves in trouble.
NATGAS D1 interval. Source: xStation5
OIL
Let’s move to the oil market, which just like NATGAS, experienced an elevated volatility recently. The price of oil surged to fresh YTD highs and now we can observe a continuation of an upward move. Should current sentiment prevail, the price may move towards 2018 highs (near $85.5), where the 161.8% exterior Fibonacci retracement can be also found. However, in the case of a bigger downward correction a key support to watch can be found at $80.70 (lower limit of 1:1 structure). According to the Overbalance methodology, as long as the price sits above it, the main trend remains upward.
OIL H4 interval. Source: xStation5
