The US Dollar Index is breaking out, but still needs a weekly close, states Bill Baruch of Blue Line Futures.

USDCNH (dollar/yuan) at a critical technical juncture. The 50dma is priming to cross above the 200dma. Potential resolution higher from consolidation wedge. CBOE SPX Volatility Index (VIX), bullish pattern playing out. The S&P 500 (SPX) is testing rare major four-star support and 50dma, discussed below.

The dollar strength is pressuring commodities. China left rates unchanged as expected, but easing was a wild card that may have underpinned commodities off yesterday’s lows. No major economic data on today’s calendar. Flash PMIs from Europe and US Monday and Jackson Hole begins next Wednesday.

Dallas Fed President Kaplan spoke today. Last week, he said, “if the economy unfolds the way he expects between now and the September meeting, the Fed should announce a taper in September and begin in October.” Although one of the most hawkish committee members, he does not vote until 2023. Keep an eye on the Unemployment Benefits narrative. Treasury said states can use pandemic benefits to keep them going. May added some wage inflation.

Emini S&P (September) / NQ (Sept)
S&P, yesterday’s close: Settled at 4401.50, up 7.00
NQ, yesterday’s close: Settled at 14,928, up 78.75

A sharp rebound yesterday could not chew through major three-star resistance at 4411.754416.75. Highlighted this in our Midday Market Minute yesterday. Price action hugging 4400 with tremendous option open interest here.  Sellers took the reins for the second overnight in a row, but higher low and held rare major four-star support.  Break below 4359.504365 and 50day moving average could get ugly due to dealers selling to hedge. NQ major three-star resistance at 14,97514,997 holding. NQ major three-star support at 14,69214,722 aligns multiple indicators and 50day moving average. Held yesterday but selling would pick up below.

Bias: Neutral
Resistance: 4401.504403*, 4411.754416.75***, 4327.50***, 4445.50**
Pivot: 4391
Support: 43734377**, 4359.504365****, 4350**, 4343.50**, 4315.504320.50***, 4302**, 4248.254252.75****

NQ (September)
Resistance: 14,97514,997***, 15,03815,058**, 15,13415,150***
Pivot: 14,905
Support: 14,85014,874**, 14,763**, 14,69214,722***, 14,50014,540**

Crude Oil (October)
Yesterday’s close: Settled at 63.50, down 1.71

Battling at rare major four-star support at 62.5462.99. Close below opens the door for a test to $60. Major three-star resistance at 64.49 has held, reinviting selling. Dollar weighing on commodities. Fed tightening, slowing growth, China, Covid and demand outlook all weighing on crude. Baker Hughes due at noon CT.

Bias: Neutral
Resistance: 64.49***, 65.0165.21***, 65.51**, 66.34***, 67.0067.23***
Pivot: 6343
Support: 62.5462.99****, 61.1161.56**, 60.0060.67****

Gold (December) / Silver (Sept)
Gold, yesterday’s close: Settled at 1783.1, down 1.3
Silver, yesterday’s close: Settled at 23.23, down 0.192

US dollar strength and stable Treasuries keeping gold rally attempts all week in check. The same coupled with fears of slowing growth weighing on silver. On the week, gold +0.3%, silver 2.7%. Support at 17801782 in gold doing heavy lifting. Momentum indicator at 1785, continued action below here will encourage price action to chew through support. Big level of support at 22.9723.00 being defending in silver.

Bias: Neutral
Resistance: 17961799***
Pivot: 1785
Support: 17801782**, 1763.11768***, 1751.1***, 1736.81742.6**, 17181724.6***

Silver (Sept)
Resistance: 23.4123.50**, 23.7823.82**, 24.0724.32***, 24.5124.65***
Pivot: 23.21
Support: 22.9723.00***, 22.28****

Learn more about Bill Baruch at Blue Line Futures.