Technical Market Forecast and Review Ahead of the NFP (Feb 3)


After a breach of Quasimodo’s Weekly Reversal Support Resistance at $1.0888 with price action, as well as the nearby key resistance on the daily chart at $1.0954-1.0864, ​​more buying is on the table against Quasimodo Daily Resistance at $1,1138 and Weekly Resistance is coming in from $1.1174.

The uptrend has been largely confirmed on a daily scale by a series of higher highs and higher lows since recovering from daily support at $0.9573 (and weekly support at $0.9606). Further confirmation of the trend is seen by the price crossing above its 200-day simple moving average, which is currently floating around $1.0316. We can also see that the moving average is starting to flatten off its low: another sign of a possible trend reversal to the upside. Despite the bullish atmosphere, the daily chart’s RSI is revealing early signs of a negative divergence ahead of the overbought territory.

Outside the H1 chart, the unit is seen recovering from $1.09 after an aggressive bull trap formed north of $1.10. A space below $1.09 requires a support area around $1.0870, which consists of the 61.8% Fibonacci retracement at $1.0868 and the 50.0% retracement of $1.0872. Looking below here reveals trendline support extending from the $0.9730 lows and the $1.08 figure.

Therefore, with both the weekly and daily charts indicating weak resistance and a clear uptrend, the support area on H1 between the 61.8% Fibonacci retracement at $1.0868 and the $1.09 figure could offer buyers a platform to act from today (yellow oval).

EUR/USD weekly (top left), daily (bottom left) and 1 hour charts. Source: TradingView

Standard & Poor’s 500

The recent move in the S&P 500 has been largely one-sided since the index moved above weekly trendline resistance last week, taken from the high of 4,818. Throw a wrench in the works Is Quasimodo resistance on the weekly scale at 4177, closely overshadowed by the high of 4325 on Aug 15 (2022). A break of the weekly trend line resistance mentioned above indicates the potential for more buying, in line with the long-term bullish trend on the monthly time frame.

Accordingly, the current resistance of 4177 H is important at the moment. Adding to the upward decline on the weekly chart is the Relative Strength Index (RSI) venturing above the upper border of the ascending triangle between 53.72 and 30.47. Although these formations are generally found in uptrends, they can also create reversal signals.

From the daily timeframe, after the price crossed the resistance at 4087 (now a potential support), limited resistance is emerging until the high of 4325 on August 15th mentioned on the weekly scale. On the daily timeframe, this top is closely followed by the 100% forecast at 4378: AB=CD pattern, plus the 78.6% Fibonacci retracement at 4391 and the 200% extension at 4431.

Finally, on the H1 timeframe, the Quasimodo resistance at 4,183 is worth noting, and welcomes the price action in the last hours. On the downside, support warrants attention at 4100, closely positioned with trendline support, picked up from the lows at 3885. A push above current resistance, as suggested on higher timeframes, reveals a potential breakout buying opportunity towards at least H1 Quasimodo support – turned into resistance at 4,219.

S&P 500 monthly, weekly and daily charts. Source: TradingView

S&P 500 hourly chart. Source: TradingView

XAU/USD (Golden)

It is evident from the weekly and daily timeframes, that the momentum to the upside has waned, despite the trend in this market facing north. Both higher timeframes are touching gloves with overbought conditions on the Relative Strength Index (RSI). The daily time frame is also modest in negative divergence. While the weekly timeframe shows support for a retest at $1,916, the daily timeframe indicates that sellers are likely to take the wheel.

The daily rising wedge pattern (between $1,929 and $1,896) saw a breakout and has since retested its lower edge (leaving nearby resistance at $1,966 unchallenged). [Quasimodo formation]). After that, sustained bearish pressure saw the price challenge the trend line support, etched from the $1,616 lows, which could pave the way for a return to a new decision point at $1,867-1,886.

Meanwhile, price action on H1 time frame was loaded through the $1,920 low (Wednesday) and is set to target the familiar Quasimodo support at $1,903 and the expected support of a nearby trend line, taken from the $1,949 high. Higher interest upside can be seen at the decision point of $1,947-1,943 (formed during Thursday’s rally lower in early US trading) and Quasimodo resistance near $1,954.

Overall, sellers seem to be in control, targeting the indicated H1 support structure. A sweep of these levels also suggests that the weekly support at $1,916 is weakly positioned and could eventually open more downside towards the daily time frame at $1,867-1,886 decision time.

Weekly, daily and 1-hour gold charts. Source: TradingView

Bitcoin / US Dollar

Thursday’s refreshing highs not seen since August 2022 provide the opportunity to reach the weekly time frame’s falling wedge (between $25,214 and $17,567) at $25,698, followed by resistance at $28,844. This of course is in line with the chart’s Relative Strength Index (RSI) heading north from the 50.00 center line (followed by the positive divergence).

Although the price has recently struggled to reach new highs, the momentum has undoubtedly waned over the past few weeks, as can be seen more clearly on the daily chart. This is also shown by the RSI time frame shaking hands with the indicator’s resistance at 89.35 and producing negative divergence. As for resistance, the Quasimodo formation at $24,666 warrants attention, which is a small measure of the aforementioned weekly profit target pattern at $25,698.

Short-term price action shows where the cryptocurrency is recovering above the $24,000 line on the H1 chart, highlighting the nearby Quasimodo resistance at $24,319. This helps confirm the bullish setup seen on the weekly and daily charts, as a break of $24,319 would basically pave the way for a rise to daily Quasimodo resistance from $24,666 and possibly a weekly chart profit target of $25,698.

Bitcoin weekly, daily and 1 hour charts. Source: TradingView


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Technical Market Outlook and Pre-NFP Review (Feb 3) – Coinphony [SV]

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