Technical Indicators for World Indices Are Building up Strength

10/19/2020 10:00 am EST

Focus: MARKETS

Trevor Smith

Commodity Trading Advisor, www.trevorsmithfnp.com

Mid-month math predicts trending breakouts for currencies, indices, reports Trevor Smith of Trevor's Trading.

Market internals/technical indicators for world indices are building up strength, but I expect another challenging down move below 3431 in the S&P 500 futures; it may occur before further rallies as an effort both to test the 3385 technical support cluster underneath current price and to create strategic, alluring technical positioning of the market internals/index-related symbols within the Bollinger Bands to attract more bullish market participants. 

Japanese yen futures and the euro are in trending math conditions for the next two weeks such that traders can observe and join those symbols' breakouts or directions. Options/option spreads offer defined-risk approaches to trading these types of trending-breakout setups; always seek professional advice regarding risks/benefits of trading instruments and understand them well.

Note to readers: This article’s publishing frequency is now bi-weekly (every other week) and will seek to forecast weekly ranges for the coming two weeks.

My last article on October 5, prior to a 50-point increase in the S&P futures' weekly range, mentioned the likelihood of the S&P 500 futures breaking out by stating the following: "Statistically, the currencies and S&P futures should make the widest breakout price moves." Seven of 10 ranges printed as of Sunday, October 12, 2020.

Next Two Week’s Predicted Ranges (Sunday Night, October 18. 2020)

E-mini S&P 500
High Range 3517-3501; Low Range 3415-3395
Bearish opinion & skewed ranges due to a wave pattern embedded within candlestick pattern and a group of moving averages/pivots below near 3390; Breakdowns below 3431 could lead to 3385, as a wide-range low target. 

Japanese Yen
High Range 9545-9520; Low Range 9446-9405
Neutral-bearish ranges based on moving averages below current price. Wide range down move may exceed my ranges in context of trending math.

Euro FX
High Range 1.189-1.183; Low Range 1.166-1.161
Neutral ranges based on two-day chart’s 1.169, 1.176 moving average support/resistance levels, respectively, in trending-math breakout conditions.  

Gold
High Range $1953-$1937; Low Range $1891-1875 
Neutral-expanded ranges based on narrow ranges on multiple time frames, weekly-chart moving average support, and monthly-chart bearish candlestick patterns/valuations with a light short trade signal down to $1,775/ounce target. (Disclosure: I am in this short call spread bear trade to Thanksgiving expiration)

Crude Oil
High Range $4230-4167; Low Range $3980-3850
Neutral-mixed directional range skew; Breakout trade wave-three up at $40.80, 41.52; $38.91 breakdowns may print $38.40; traders can narrow my widened low range if bullish. Pivots support.  

Prior Predicted Ranges (for week of October 5, 2020)

E-mini S&P 500
High Range 3415-3393; Low Range 3308-3291
Neutral ranges/opinion based on bullish internals, bearish technical understudies
Actual: 3480-3330

Japanese Yen
High Range 9545-9515; Low Range 9470-9445
Neutral-bearish ranges based on moving higher time frames. Breakdown level at .009459. to .009445 zone derived from three-day chart
Actual: 9494-9430

Euro FX
High Range 1.179-1.176; Low Range 1.169-1.166
Neutral-bullish ranges based on two-day chart’s weak doji breakout higher
Actual: 1.184-1.172

Gold
High Range $1931-$1917; Low Range $1894-1875 
Neutral-bullish ranges two-day chart, with bearish monthly chart candlestick short trade signal down to $1,775/ounce target. Trade idea: short call spread/monthly options (Disclosure: I am placing this trade after publishing)
Actual: $1,936-1877

Crude Oil
High Range $4118-4075; Low Range $3965-3917
Neutral-mixed directional range skew; Breakout trade wave-three up at $40.80, 41.52; $38.91 breakdowns may print $38.40; traders can narrow my widened low range if bullish. Pivots support.
Actual: $4147-3700  

Trevor Smith is a technical market analyst/forecaster who is registered as a Commodity Trading Advisor. Follow Trevor Smith here.

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