Technical Analysis – US 100 cash index hovers at key area
April 25, 2023 8:27 am
The US 100 index has been moving lower over the past five sessions as market participants appear to be on the sidelines ahead of the busy events over the next 10 days. The price is flirting with the inner Bollinger line that connects the US 100 lows since the March 17 break of the upper Bollinger Band. A break of this line is usually associated with a sizeable downward move.
Even the bulls could be open to the possibility of a small pullback as this will suit the current series of higher highs and higher lows, provided that the next local trough is above the March 13 low of 11,683. In the meantime, the Average Directional Movement Index (ADX) is stuck below its 25-threshold, confirming the overall lack of appetite in the market. More interestingly, the stochastic oscillator is edging lower, pointing to muted bearish pressure, which will intensify if this indicator makes a more aggressive move lower.
Should this occur and if the US 100 breaks the busy 12,858-12,888 area, the next resistance would come at the 12,465-12,597 range defined by the September 2, 2020 high and the 50-day simple moving average (SMA) respectively. Even lower, the crowded 12,083-12,276 area could prove tougher to crack.
On the other hand, if the bulls win the battle for the 12,858-12,888 area, they could quickly turn their focus to the early April highs at the 13,206 level. Then, they would potentially test the water around the 13,600-13,721 area populated by the August 16, 2022 high and the 50% Fibonacci retracement level of the November 22, 2021 – October 13, 2022 downtrend respectively.
To sum up, the gentle move lower has pushed the US 100 towards key levels. A combination of factors points to more downside, but bulls are on high alert.
The US 100 index has been moving lower over the past five sessions as market participants appear to be on the sidelines ahead of the busy events over the next 10 days. The price is flirting with the inner Bollinger line that connects the US 100 lows since the March 17 break of the upper Bollinger Band. A break of this line is usually associated with a sizeable downward move.
Even the bulls could be open to the possibility of a small pullback as this will suit the current series of higher highs and higher lows, provided that the next local trough is above the March 13 low of 11,683. In the meantime, the Average Directional Movement Index (ADX) is stuck below its 25-threshold, confirming the overall lack of appetite in the market. More interestingly, the stochastic oscillator is edging lower, pointing to muted bearish pressure, which will intensify if this indicator makes a more aggressive move lower.
Should this occur and if the US 100 breaks the busy 12,858-12,888 area, the next resistance would come at the 12,465-12,597 range defined by the September 2, 2020 high and the 50-day simple moving average (SMA) respectively. Even lower, the crowded 12,083-12,276 area could prove tougher to crack.
On the other hand, if the bulls win the battle for the 12,858-12,888 area, they could quickly turn their focus to the early April highs at the 13,206 level. Then, they would potentially test the water around the 13,600-13,721 area populated by the August 16, 2022 high and the 50% Fibonacci retracement level of the November 22, 2021 – October 13, 2022 downtrend respectively.
To sum up, the gentle move lower has pushed the US 100 towards key levels. A combination of factors points to more downside, but bulls are on high alert.
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