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US Dollar Soars as S&P 500 Stalls Below Chart Resistance

By Ilya Spivak, Currency Strategist

10 May 2013 02:42 GMT  
THE TAKEAWAY: The US Dollar raced upward to produce what appears to be a meaningful topside breakout while the S&P 500 has stalled at chart resistance, hinting at a pullback.

US DOLLAR TECHNICAL ANALYSIS– Prices broke above resistance at the top of a rising channel set from early March, exposing the 123.6% Fibonacci expansion at 10640. A further push above that targets the 138.2% mark at 10668. The channel top – now at 10590 – has been recast as near-term support.

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS – Prices put in a Harami candlestick pattern below resistance at 1633.20, the 38.2% Fibonacci expansion, hinting a move lower may be ahead. Near-term support is marked by the psychologically significant 1600 figure and the 23.6% level at 1595.90. A break below that initially exposes the 14.6% Fib at 1572.90. Alternatively, a reversal above resistance eyes the 50% expansion at 1663.30.

Daily Chart - Created Using FXCM Marketscope 2.0