XJO WEEKLY    

Price structure: Bullish continuation

The S&P/ASX 200 Index (XJO) recently saw a bullish retest of the 8083 support level, indicating consolidation. This level has been closely watched by traders, and the market’s ability to hold above it suggests continued upward momentum.

The index has been displaying strong buyer dominance, with a breakout above this key technical barrier reinforcing bullish sentiment. If this trend continues, we could see further gains in the near term. The next resistance level is 8514, with current price momentum this level may be tested this week.

Indicator: Relative strength 14: Positive upward momentum.

Relative strength has turned higher in line with the upward movement in the Index and remains above the key 50 level. Only further movements higher towards the 70 level can set a continuing bullish signal for price movements.
The RSI turning further lower to move below the 50 level, is a strong indication is for negative momentum to develop leading to Up Trend failure and further declines.

Comments last week:-  The S&P/ASX 200 Index (XJO) has set a short-range trading week, with a retest of the 8083 support level mid-week. This suggests that the market is consolidating, with traders closely watching whether this level will hold or break.

A retest of 8083 is particularly significant because market participants are watching closely to see if this level can hold. If the price action shows a robust bounce, it can reaffirm the strength of this support zone and signal renewed buying interest. Conversely, a decisive break below 8083 might indicate that the support is weakening, potentially leading to accelerated selling from a shift in market sentiment.

XJO DAILY  

Price structure:  Consolidation above 200 SMA

The daily chart of the 200 Index reveals a pattern of small-range days, suggesting buyer hesitation as the index approaches the short-term resistance level of 8330. This type of price action often indicates indecision in the market, where traders are waiting for confirmation before committing to further buying or selling. In this case news around the US induced tariffs on global markets.

The breakdown below 8330 and the recent retest of the 200 SMA  has been tested briefly by the sellers, and the market is now at a critical juncture. If buyers regain control and push the index above this level, it could signal renewed bullish momentum. However, failure to break through may lead to further consolidation or a potential pullback.

Indicator:  Relative strength 14:  Very strong momentum

The Relative strength Indicator (14) has moved above the important 50 level and now approached the 70 level  indicating improving positive momentum. From a technical perspective, RSI moving over 50 and 60 often suggests an improvement in Bullish momentum, overall bearish volatility and selling pressure has subsided for now.

Comments last week When the daily chart shows that the XJO Index has moved above its 200-day simple moving average, it marks a significant technical milestone. The 200-day moving average is a widely respected gauge of long-term trend, with the index trading above it suggesting that the broader market sentiment could be shifting from bearish to bullish. The strong close for the week adds even more conviction to this signal. A robust weekly close typically indicates that buying pressure prevailed despite any intraweek volatility. It means that as the market session ended, buyers were in control, absorbing any selling pressure.

S&P 500 WEEKLY:  Breakaway Gap

The S&P 500 Index has made a decisive move, forming a breakaway gap, which is a strong signal of buyer dominance. This type of gap typically occurs when bullish momentum is so strong that prices open significantly higher than the previous close, leaving no overlap between the two trading sessions.

The 5853 resistance level was strongly breached, reinforcing the bullish sentiment. With this level now acting as support, traders are eyeing the 6100 resistance level, which is clearly within reach. If buyers maintain control, we could see a continued push toward this next key level. Market participants will be watching for follow-through buying and whether the index can sustain its gains. A failure to hold above 5853 could signal a retracement, but for now, the trend remains firmly bullish.

Indicator:  Relative strength 14.   Above 50

As for bullish confirmation, a recovery back to the 50 level on the RSI shows momentum is a strong indication of improving momentum. A directional move over this level will indicate renewed strength and the potential for a renewed and continuing upside shift in momentum.

A reverse and deeper move back towards the 50 level would signal potential exhaustion among buyers, but without clear evidence of sellers stepping in, downside risks remain low.

Comments from last week

The S&P also set a short-range week with the close below the 5670-resistance level, a further push higher could be expected following this current consolidation. Closing below a key resistance level like 5670 suggests that while a full breakout was not achieved, the market has remained resilient. Buyers held firm enough to prevent a steep decline, yet the inability to decisively breach 5670 indicates that a cautionary approach has persisted near these higher levels. During consolidation, prices typically oscillate within a defined range, allowing the market to reset before potentially launching into a new phase. This phase of calm often serves as a period of accumulation.

SPX DAILY    Price structure:  Breakaway Gap

The daily chart of the S&P 500 Index reveals a strong breakaway gap above the 200-day moving average, signalling buyer dominance and a strong and positive shift in momentum. This type of gap indicates a decisive move, where bullish sentiment overwhelms selling pressure, leading to immediate follow-through to higher prices.

With the index now comfortably above this key moving average, traders will be watching for continued strength and whether buyers can sustain the rally. The Daily chart is closing in on the resistance levels of 6020 and 6100.

Indicator: Relative strength 14. 

The Relative Strength Indicator (RSI) having moved strongly to the key 70 level turning higher in line with price action two weeks ago and has this week moved sharply higher. Momentum has now turned towards a strong Bullish buy signal now complete with the sustained cross of the key 50 level. A continuing close above the 50 level is required to remain bullish. If the RSI falls further below the pivotal 50 level, it will likely confirm a further bearish outlook, leading to further downside targets.

Comments from last week:  The Daily chart better defines the consolidation around the 5670-resistance level with the small Gap fill last Wednesday. It is also observed the current price consolidation remains below the 200-day average.  Once this balancing act resolves—especially with a convincing move above the 200-day average—it would serve as a catalyst for a more sustained upward push. The expectation of price moving back into the consolidation zone below the 6100 level and above the 5832 level remains.

NASDAQ (100) DAILY Price structure:  Strong Consolidation.

The Nasdaq 100 Index initially encountered resistance at the 200-day moving average, but buyers have since regained control, leading to a breakaway gap and a strong momentum move higher. This type of gap often signals a shift in market sentiment, where bullish forces decisively push prices beyond previous resistance levels.

With the index now trending upward, traders will be watching for follow-through buying and whether the breakout can sustain itself. If momentum continues, the Nasdaq could extend its gains further towards the 22,133 resistance level, a further breakout above this level would be a significant milestone and show a reinforcing of the overall bullish trend.

Indicator: Relative strength 14: Bullish turn

The Relative Strength Index (RSI) has now turned higher after breaking over the critical 50 level, which signals positive strength in momentum remains. With the RSI continuing to rise over the 70 level, it would serve as a strong Bullish indicator, highlighting a significant move higher may be underway, market participants cannot afford to overlook this outcome.

Comments from last week.  While the Nasdaq’s current consolidation below the 200-day moving average indicates a pause in momentum, it also sets the stage for a potential rebound if the necessary bullish catalysts emerge. During consolidation the market builds the energy required for a sustained upward move, but traders should remain cautious and await further confirmation before committing to new positions. The key observation of last week price action is the closing of the Gap followed by the move back to the 200-day average. A price move back to this lower level would send a Bearish signal to traders.

USD Spot GOLD – DAILY:  Retest of Support

USD Gold is currently undergoing a retest of critical support at $3167.50, signalling a major consolidation phase is underway. This level is crucial for traders, as price action around this confluence of support and the major trendline support level will determine whether gold continues its bullish trend or experiences a deeper pullback.

Gold has been fluctuating within a tight range between $3167.50 as support and closing price area of $3,450 resistance, reflecting market indecision. If buyers step in and defend this support level, we could see a renewed push higher. However, a failure to hold above $3167.50 may lead to further downside pressure towards the $2956.0 level.

Indicator:  Relative Strength 14:  Slowing momentum

The RSI has moved to cross the 50 level  and remains lower and the previous high point set during the second push to $3500 observed in early May. This is a signal of weakening internal momentum in this current look back period (14), however, it remains a short-term observation as price begins to consolidate. Further RSI declines in the coming week below the 50 level will reflect the potential for a strong divergence outright sell signal. Short term holders and traders should now monitor the RSI for a continuing movement below the 50 level as a sell signal.

Comments from last week: Despite the looming resistance at $3500, the price is trading above the short-term trend line—a line drawn through recent support lows that reflects the immediate price trajectory. This trend line serves as dynamic support, suggesting that even though the rally has stalled near $3500, buyers are still present enough to prevent a sharp decline. If gold manages to accumulate sufficient buying momentum, particularly with confirming signals like a spike in activity or bullish candlestick formations in early trade this week, it could break above the $3500 resistance, signalling the start of a new upward trajectory. The underlying Primary trend remains UP.

AUD GOLD – DAILY: Consolidation

Gold, priced in Australian dollars, once again faced resistance at the $5,200 level, failing to break through this key threshold. This rejection resulted in a pullback, with the precious metal setting a weekly low below the $5,000 mark. The price movement reflects ongoing volatility in USD gold, and influenced by market sentiment, current economic factors around the US tariffs, leading to a potential shift in investor confidence. The Australian Gold producers may see some consolidation in price. The underlying primary trend remains UP.

Indicator:  Relative Strength 14: 

The Relative Strength Index (RSI) is showing a sharp downturn below the 70 level with a short recovery and a further downturn. Momentum is slowing, a further close below the 50 level would indicate momentum has turned bearish. Traders are advised to watch for any minor pullbacks as potential buying opportunities within this broader uptrend, as the overall market sentiment remains strongly in favour of continued gains.

Comments from last week. The Australian dollar Gold price remains stable, and the USD Gold price moves higher offset by the stronger $AUD. Importantly the current price remains above the short-term trend line and closing towards the high following a bullish week. Australian Gold producers remain in a strong buy position with very active merger and acquisition activity underway.

SILVER Price structure:  Trading range continues

USD Silver has once again settled into a tight trading range, consolidating between two significant price levels. The $33.40 mark continues to act as a firm resistance, preventing upward movement, while support remains steady at $31.60, providing a base for price stability. This consolidation suggests indecision in the market.  US Dollar Strength a current influence since silver is priced in US dollars, a stronger dollar can suppress silver prices, while a lower dollar can push them higher. Silver is not Gold.

Relative strength 14:

The relative strength index (RSI) has moved lower to align with the recent short-term reversal in price from the $33.40 level.  The current move lower has moved to the 50 level, but not decisively. This movement indicates stabilization in momentum, only a price breakout will set the RSI in a new direction.

Comments from last week. Silver is not Gold. The $32.50 level remains a critical support with resistance level of $33.40 for the metal remaining in play. While silver often gets compared to gold, its technical behaviour—highlighted by the critical support at $32.50 and the resistance at $33.40—paints its own unique market picture. The current long term trading range suggests that the metal is awaiting a catalyst before taking a definitive direction. Whether silver will break out above $33.40 or fall below the support at $32.50 will be crucial in determining its next phase, and traders should closely monitor these levels when planning their positions.

AUSTRALIAN VOLATILITY INDEX:  The equities trader’s compass.

The current volatility closing value has closed below the key 13 level. Current closing value indicates the XVI volatility level has moved to a Bullish level for Equities as the market VOLATILITY begins to see mid-week lower demand and subsequently lower priced PUT options to cover downside portfolio risk. With the indicator value moving lower from the high Mid-week, the forward pricing (Volatility) of PUT options (insurance) is decreasing, this is observed with an advance in the market. Volatility now rules in this current XJO200 corrective phase.

For continued support of equities, the XVI should remain subdued below the “13” level.

The cost of 3month forward PUT options is moving lower from recent higher levels over 13.

The XVI is the difference between 3-month forward pricing of ETO Options against current month. As markets anticipate events, the forward priced option volatility changes, hence this longer dated forward price change, or “skew” in pricing is measured in this XVI. The XVI value works as an inverse corelation to the underlying market movements.

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