XJO WEEKLY

Price structure: Bullish

The a-b-c corrective movement has now reached completion. The 7632 level, which held firmly as support 3 weeks ago, proved to be a significant juncture in the market. This pivotal point has strengthened the foundation for potential upward momentum, underscoring its critical role in the overall price structure. As a key level in the recent analysis, 7632 will continue to serve as a vital reference in monitoring further price developments. Last week a Pivot point was confirmed, this is very Bullish for further gains with the close over the 7910 level. Sell in May and go away is yet to play out.

Indicator: Relative strength 14: Declining upward momentum.

Relative strength has turned higher in line with the higher movement in the Index and has remained below the key 50 level for 8 weeks. Only further movements higher towards the 50 and 70 level can set a continuing bullish signal for price movements.
The RSI turning further lower to move below the 30 level, is a strong indication is for negative momentum to develop leading to Up Trend failure and further declines.

Comments last week:-  The Index has established a defined trading range after rebounding sharply from the 7200-point lows. This inside range suggests a period of consolidation, where market participants are assessing the strength of the recovery and determining the next direction. Investors may be closely watching for a breakout higher from this range, which could indicate a continuation of the upward momentum. A potential pullback from this point suggests traders are taking profits and reassessing broader economic conditions. Market sentiment, remains jittery, and technical signals of key support and resistance will likely play a role in shaping the next phase of movement. Key support is 7632 to hold this shortened trading week.

XJO DAILY  

Price structure:  Fluid movement

The Daily chart of the XJO reveals a steady and fluid upward movement, reflecting consistent buying interest and positive momentum. However, despite this progress, the price continues to remain below the critical Weekly resistance level of 8083. This resistance represents a significant barrier, with previous price action suggesting strong selling pressure around this level. Until the XJO manages to break above 8083 convincingly, the upward trajectory may face challenges, and caution should be exercised in anticipating further gains. This juncture will be pivotal in determining whether the index can sustain its bullish outlook or encounter a potential reversal.

Indicator:  Relative strength 14:  Neutral

The Relative strength Indicator (14) has moved above the important 50 level after the initial fall below the 30 level, the overall RSI trend shows upside momentum associated with the current price movement from the larger trading ranges within recovery. From a technical perspective, RSI moving over 50 often suggests an improvement in Bullish momentum, but in the context of overall bearish volatility, it can also indicate that selling pressure has subsided for now.

Comments last week The daily price action has steadily advanced toward the critical 7910-resistance level, reflecting strong upward momentum in recent sessions. By closing at the high in late trading last Friday, the market demonstrated sustained buying interest, with traders pushing prices higher as confidence remained intact. This close near the day’s peak suggests bullish sentiment and a potential test of the resistance level in the near term. However, market participants will be watching closely for any signs of rejection at the 7910 level, a breakthrough could set the stage for the next major movement higher in price action. External economic factors, investor sentiment, and trading volume currently remaining subdued will all play a key role in determining whether this level holds and leads to further gains.

S&P 500 WEEKLY:  Bullish pivot

Similar to other major indices, the S&P 500 has established a new bullish pivot point on the Weekly chart, signalling renewed upward potential. Last week’s outside range bar showcased notable market activity, with the price testing the 5100 level—an area of interest and psychological significance. Following this test, the index demonstrated strong bullish momentum, rallying to close at the high for the week. This price behaviour underscores growing buying pressure and suggests that the S&P 500 may be gearing up for further advances, contingent on sustained strength and favourable broader market conditions.

Indicator:  Relative strength 14.   

For bullish confirmation, a recovery back too the 50 level on the RSI is necessary. This would indicate renewed strength and the potential for an upside shift in momentum.

The current RSI reading moving above 30 and a further cross of the 50 level offers a bullish outcome. A reverse and deeper move into oversold territory could signal potential exhaustion among buyers, but without clear evidence of sellers stepping in, downside risks remain.

Comments from last week.:  The resistance at the significant Haguro level of 5382 is emerging as a pivotal point in the market, drawing attention as price action encounters resistance in breaking through. This level’s importance indicates heightened trader activity and decision-making around these price points. As the market approaches this resistance, there are signs that consolidation may now be underway, a period of indecision and stabilization. The consolidation phase around these levels will serve as a precursor to either a breakout above the resistance the preferred outcome, or a retracement, depending on market sentiment and external factors around the current Tariff announcements influencing current trading.

SPX DAILY   Price structure:  Breakaway Gap

The daily chart of the S&P 500 highlights the formation of a higher low, a key signal of strengthening bullish momentum. This development is further emphasized by the appearance of a breakaway gap, which marks a decisive shift in market sentiment and underscores the growing demand. Presently, the price has progressed into a previously established gap area, maintaining its strong bullish characteristics. The continuation of this upward movement within the gap area signals the potential for further gains, provided that the bullish momentum remains intact and there are no significant signs of reversal or resistance ahead at the 5670 resistance level.

Indicator: Relative strength 14. 

The Relative Strength Indicator (RSI) having moved below the key 30 level turning higher in line with price action last week, momentum has now turned towards a Bullish reversal now  complete with the 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:  With multiple inside days forming, the Index continues to consolidate just below the key 5504 level. This sustained consolidation suggests a period of market indecision, where traders are absorbing recent price movements and preparing for the next significant shift. The current consolidation remains confined within the impulsive pivot bar range, reinforcing the idea that price action is stabilizing before a potential breakout or retracement. Market participants will be closely monitoring price around this zone, as a decisive move beyond this range could set the stage for the next trend direction. Currently the underlying Primary Trend is down.

NASDAQ (100) DAILY Price structure:  Consolidation.

The significant impulsive price movement established on the 9th of April has continued to assert its dominance on the chart, showcasing its lasting impact on market structure. This pronounced move highlights a strong shift in sentiment and momentum, which has effectively shaped the current price action. Its presence remains a critical factor in guiding the ongoing price structure and will likely serve as a reference point for further analysis as the Higher low HL point has now been set along with the short down trend line being broken.

Indicator: Relative strength 14: Bearish turn

The Relative Strength Index (RSI) has now shifted upward, breaking over the critical 50 level, which signals positive strength in momentum. Should the RSI continue to rise further towards the 70 level, it would serve as a strongly Bullish indicator, highlighting a significant warning of potential further downside may not occur, market participants cannot afford to overlook this outcome.

Comments from last week.  The Nasdaq’s price action continues to closely mirror movements across the broader major indices, reflecting similar trends and investor sentiment. In the Nasdaq, the key resistance level remains firmly positioned at 19,180 points, acting as a crucial barrier to further upward momentum. The 18,464 level remains as support with 19,180 level set as resistance.

USD Spot GOLD – DAILY:  Rejection high

USD Gold has established a rejection high at the $3,500 level, the long upper shadow reflecting increased selling pressure and notable profit-taking activity among market participants. This development marks a key turning point as the bullish momentum encountered resistance at this critical price level. However, despite the significance of this reversal, there was no follow-through into the close last week, suggesting a potential pause in directional movement. The market may be awaiting additional catalysts or confirmation of the next major trend.

Indicator:  Relative Strength 14: 

The RSI has moved to cross the 70 level but remains lower than the previous high point. 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 70 level will reflect the potential for a strong divergence top to develop. Short term holders and traders should now monitor the RSI for a cross below the 50 level as a sell signal.

Comments from last week: Gold continues to build strong upward momentum, pushing to fresh highs as bullish sentiment drives price action. The most recent breakout from the small pennant formation signals continued strength, with technical indicators pointing to further price gains ahead. This breakout suggests renewed buying pressure and confidence among traders, reinforcing the potential for a sustained move higher. The $3167.50 support level remains as a key level to be observed on any price decline.

AUD GOLD – DAILY: Rejection

As the USD Gold price declines along with the $AUD remaining relatively stable the AUD Gold price is beginning to consolidate above the $5,00 level. The current tend lines will be critical in observing the underlying strength in price going forward.

Local Gold producers are beginning to see the benefits of strong cash flows, this is leading to some merger activity.

Indicator:  Relative Strength 14: 

The Relative Strength Index (RSI) is showing a consistent move above the pivotal 50 level and 70 level. This persistence above the 70 topline suggests that the bullish momentum is not only intact but may strengthen. 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. AUD Gold has reached a new closing high, signalling strong upward momentum in the market. With USD Gold prices continuing to rise and the Australian dollar holding within the 62c to 63c range, the conditions remain favourable for further price gains. The steady performance of the $AUD relative to USD Gold supports expectations for continued strength, as investors respond to shifting global market expectations around inflation and uncertainty in the US Bond market. Traders will be monitoring whether this momentum sustains and if higher resistance levels come into play in the near term.

SILVER Price structure:  Silver is not Gold.

The price of Silver has been confined to a broad consolidation zone for an extended period, reflecting a balanced tug-of-war between buyers and sellers. However, recent price activity hints at a potential retest of the $35.0 high, suggesting an emerging bullish sentiment within the market. Last week, Silver’s price found key support at the $32.50 level, solidifying its role as a short-term base for upward movement. Simultaneously, resistance was encountered near the $33.40 level, indicating a critical threshold that will need to be overcome for further progress toward the $35.0 mark. These developments outline a decisive phase for Silver as it approaches pivotal levels in the coming days. 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 higher has moved over the 50 level, but not decisivly. This movement suggests a potential stabilization or recovery following the reversal.

Comments from last week. Silver has surged to the $32.50 level, encountering selling pressure as the market approached the weekly close. This suggests that traders are taking profits or positioning ahead of potential shifts in price action. Despite this, Silver continues to trade within a broad consolidation zone between support at $28.72 and resistance of $35.00, indicating that the market is still searching for direction. A sustained breakout or rejection from this $32.50 area could provide the next major movement, with traders closely watching technical indicators and external market influences for further confirmation.

AUSTRALIAN VOLATILITY INDEX:  The equities trader’s compass.

The current volatility closing value has closed below the key 13 level with a further spike lower during the week.  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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