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THE TAKEAWAY: US Dollar and the S&P 500 technical positioning warns of weakness ahead, hinting the two benchmark assets may move lower in tandem.

US DOLLAR TECHNICAL ANALYSIS- Prices put in a Shooting Star candlestick below the top of a rising channel set from mid-September (10205), hinting a move lower is ahead. Near-term support is at 10181, the 61.8% Fibonacci retracement, with a break below that exposing the 50% level at 10153. Alternatively, a move above resistance initially eyes the 76.4% expansion at 10216.

Forex_Analysis_US_Dollar_SP_500_Charts_Warn_of_Weakness_Ahead_body_Picture_4.png, US Dollar, S&P 500 Charts Warn of Weakness Ahead Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS - Prices put in a Bearish Engulfing candlestick pattern having hit the highest level since December 2007, hinting a move lower is ahead. Negative RSI divergence reinforces the case for a downside scenario. Near-term support is at 1485.10, the 23.6% Fibonacci retracement. A break below that exposes the 38.2% mark at 1466.50. Near-term resistance is at 1515.10, the February 1 high.

Forex_Analysis_US_Dollar_SP_500_Charts_Warn_of_Weakness_Ahead_body_Picture_3.png, US Dollar, S&P 500 Charts Warn of Weakness Ahead Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS - Prices continue to hover above rising trend line support dating back to mid-May (1656.78), with a bullish Morning Star candlestick pattern arguing for an upside bias. Near-term resistance is at 1690.39, the 38.2% Fibonacci retracement, followed by a falling channel top at 1696.74. Alternatively, a drop below support targets the January 4 low at 1625.69 and the channel bottom (now at 1598.77).

Forex_Analysis_US_Dollar_SP_500_Charts_Warn_of_Weakness_Ahead_body_Picture_2.png, US Dollar, S&P 500 Charts Warn of Weakness Ahead Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS- Prices broke lower as expected, taking out the bottom of a Rising Wedge chart formation, after putting in a bearish Dark Cloud Cover candlestick pattern. Sellers now target the 93.40-94.61 area, with a break below that exposing trend line resistance-turned-support at 91.74. The Wedge bottom (now at 97.78) has been recast as resistance. A reversal back above that aims for the January 30 high at 98.21.

Forex_Analysis_US_Dollar_SP_500_Charts_Warn_of_Weakness_Ahead_body_Picture_1.png, US Dollar, S&P 500 Charts Warn of Weakness Ahead Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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