Mid-Week Technical Outlook: Commodities & Indices

• Crude falls below 50-day SMA
• Brent wobbles above $88
• SPX500_m slips below 200-day SMA
• NQ100_m back within range

Asian markets rose on Wednesday after Chinese authorities approved a whopping 1 trillion yuan in government bonds to support its economy.

In Europe, shares slipped despite the positive mood from Asia as investors focused on a slew of mixed earnings reports from the region. Looking at currencies, the dollar remains steady ahead of a speech by Fed Chair Jerome Powell while the euro is struggling for direction as the ECB meeting looms. Regarding commodities, oil prices remain under pressure amid concerns over weak European demand with Brent wobbling above $88 as of writing.

This has been an incredibly eventful week for markets thus far as the combination of geopolitical risk, top-tier economic data, and corporate earnings influence sentiment.

Given the ongoing geopolitical risks and slew of corporate earnings this week, our focus falls on commodities & indices today.

WTI Crude falls below 50-day SMA

Oil bears are drawing strength from concerns over weak European demand and cautious optimism over the Israel-Hamas conflict not spreading to other regions.

The global commodity has shed almost 5% this week with prices trading below $85 as of writing. Although technical indicators are slowly shifting in favour of bears, bulls remain protected by a couple of key support levels.

• Sustained weakness below the 50-day SMA may encourage a decline toward $81.10 where the 100-day SMA resides.
• Should prices push back above $86.40, this could trigger an incline towards $88.40 and $91.00, respectively.

Brent wobbles above $88

Brent remains under pressure on the daily charts with bears grinding into the $88 support level. With prices already trading below the 50-day SMA and the MACD trading below zero, further downside could be on the cards.

• A strong breakdown below $88.00 may open a path toward $85.30 and $83.00 respectively.
• If prices can keep above $88.00, this could trigger a rebound back above the 50-day SMA before bulls target $94.10.

SPX500_m slips below 200-day SMA

The SPX500_m could experience a major breakdown if prices fail to push back above the 200-day SMA at 4250.

Prices are already bearish on the daily charts as there have been consistently lower lows and lower highs, the index is respecting a bearish channel while the MACD trades below zero. With earnings season in full force, the next few days and weeks promise to be eventful for the SPX500_m.

• A solid daily close below 4210 may spark a selloff towards levels not seen since May 2023 at 4140.
• Should prices push back above the 200-day SMA, prices could push higher towards 4332.

NQ100_m back within a range

This may be a big week for the NQ100_m as the biggest names in tech announce their earnings this week. Prices seem to be trapped within a range with support at 14550 and resistance at 14900. A major breakout could be on the horizon with the right fundamental spark.

• Should prices secure a solid daily close below 14550, this may open the doors towards 14250.
• A move back above 14900 could inspire bulls to challenge the 50 and 100-day SMA before testing 15300.