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Oil facing key resistance level; Nifty trying to breakout downtrend channel

By Margaret Yang

The Brussels explosions gave the market a shock yesterday. European markets opened lower but gradually recovered the losses once the news had been digested. However this attack, together with a series of terrorist attacks believed to have been perpetrated by ISIS since last year, will have an impact on investors’ confidence in the Eurozone in the long run, as the problems of refugees and terrorism may result in rising economic and political instability.

Asian markets closed lower except for the Nikkei, which rose 1.94% on a weaker yen. USD strengthened for the third day this week, putting pressure on commodity prices. Crude oil is facing a key resistance level at $40. India’s Nifty is trying to break out of a prolonged downtrend channel. Singapore’s Straits Times Index closed flat. The Index is facing immediate resistance at 2,900 and waiting for a new catalyst for a breakout.

market23032016a
Crude Oil West Texas - Cash

Key technical levels:

  • Immediate resistance levels : $40.0, $41.6 (200 Day moving average)
  • 20 Day, 50 Day moving averages are sloped up, whereas 200 Day sloped down
  • MACD, RSI indicates overbought
market23032016b
India 50- Cash

Key technical levels:

  • 20 Day moving average crossed above 50 Day moving average
  • Immediate resistance level: 7,900 (previous high + 200 Day moving average)
  • Trying to breakout above the downtrend channel, but will face some selling pressure
  • MACD and RSI indicate overbought

Margaret Yang Yan, CFA, is a market analyst for CMC Markets Singapore.