The 240-minute chart for the S&P 500 futures shows a useful coincidence between the uptrend line drawn and the top of the green cloud formation.

The 1110 level appears likely to be tested in today’s session and a close below that level would energize the bears. I remain relatively neutral with a slight bias to the buy side for US equities at present. Despite the obvious case that the fundamentals are deteriorating, from a technical perspective the ability of this index to remain above the trend line indicated since July 20 and the proximity of the 1130 target would still tend to suggest that it would be prudent to wait for the short sellers to take their best shot and then on an intraday basis look for opportunities to ride back on the squeeze-induced rallies.



EUR/JPY is below 113 again and the technical picture since I discussed this pair a week ago looks weaker.



I have also commented on CHF/JPY and the daily chart is pointing to two key violations of the uptrend since the spring of 2009.

The pending test of the bottom of the cloud will be revealing as a failure for the Swiss franc to arrest its decline against the yen would be a clear signal that in the sliding scale spectrum from risk appetite to risk aversion, the latter is gaining more converts.



Last Friday I mentioned that spot gold would be vulnerable if we see a close below the 1190 level. As it turned out, the weak NFP data, with the heightened sense that QE2 may be on the horizon propelled the metal upwards.

However, the 240-minute chart is sending another warning signal that a correction might be at hand.

The metal is likely to respond quickly to any signals from the Fed regarding potential changes in future monetary policy, but amid all of the gyrations in price, I would repeat that the 1185/90 is now a key support level.



Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market.