Charts of the Week: Recovery attempt in WTI and S&P 500; Gold resumes uptrend

Oil bulls had to show a lot of patience in the past few weeks, but WTI is finally showing some signs of a recovery. The positive RSI divergence on the Daily chart and broadly oversold conditions suggest an upside correction could follow in the near-term. The next notable resistance level lies around $54.50, giving WTI enough room for a decent recovery.

One currency benefiting from the rising Oil prices is the Canadian Dollar. Should the USD weakness persist as well, USD/CAD could come under even stronger pressure. The Daily chart suggests traders should keep an eye on the 50 % Fibo of the October - December rally. A clear break beneath that level could signal that further losses lie ahead.

USDCAD
USDCAD

Demand for Gold has surged in the past few weeks, as markets drifted into a risk-off environment. While XAU/USD appears to be slightly overbought in the short-term, the uptrend still looks healthy and the high levels of volatility and uncertainty in markets could keep the precious metal bid in the near-term. The next interesting level to watch to the downside is $1273 - which is the 38.2 % Fibo of the Dec-Jan rally.

XAUUSD
XAUUSD

The S&P 500 managed to recover from the Christmas sell-off. However, it remains to be seen if the rally is sustainable. Heavy resistance can be expected in the area between 2590 and 2600 points. A clear break above that area would give bulls some confidence and possibly pave the way for a recovery towards 2800 points. Should the S&P 500 fail there, selling pressure might intensify again.

The information provided here has been produced by third parties and does not reflect the opinion of AxiTrader. AxiTrader has reproduced the information without alteration or verification and does not represent that this material is accurate, current, or complete and it should not be relied upon as such. The Information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any particular trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.