Monday is a Bank Holiday in the UK, but the US markets will be open as usual.
Stock indices hit new highs for the current move. The RSI on a weekly level has cleared the 60 level on both the S&P 500 and the Nasdaq 100 and is testing it on the Dax. This suggests that there is still potentially further to go in this rally. As before, only the Nikkei remains in a long-term downtrend of the four stock indices we trade at LS Trader and could complete a trend change this week.
From last week: “Crude broke through resistance as expected, completing a change of long-term trend to up. Both Brent Crude and Heating Oil are within range of similar tests and may also breakout and complete long-term trend changes.”
Both Brent Crude and Heating Oil made breakouts and completed the trend change to up. Natural Gas, the only energy market in a downtrend, broke to the downside.
Also from last week: “Gold and Silver continue to show weakness. There is a potential head and shoulders top formation in Gold, and a break of the neckline may lead to continued weakness towards 1222, very near to trend-defining support.” Gold fell through the neckline and may now head lower towards 1222, but for now, the long-term trend remains up.
From last week: “Across the sector, there is an environment of collapsing volatility, and very low volatility levels are evident in several majors, which usually precedes a directional move.” The Dollar Index rallied sharply on Thursday to exceed the March peak and move to its highest level of the current move. The Euro remained below support and moved sharply lower on Thursday, moving inversely to the Dollar Index. The Dollar also broke to the upside against the Swiss franc.
## Interest rate futures
From last week: “The long-term trend remains up across the sector, but further short-term weakness looks likely before the trend reverses back to the upside.” It’s possible that a short-term low may have been printed on Thursday as the RSI bounced off the 40 level, keeping these markets in the bull range. In addition, price action saw a 3-day morning star bullish reversal printed. The trend remains up.