Gold has been in a sideways consolidation for over four months, with erratic movements making it difficult to predict the next move. On the daily chart, the moving averages are stagnant and we see a negative divergence with a downtrend in the slow stochastics, suggesting a possible downturn early this week.

Similarly, the Emini S&P futures have an uptrend line, but here too we have a negative divergence on the Slow Stochastic. The market is hovering just above the 100-day moving average – a crucial level that could determine the direction for the week.

In the Nasdaq, I’m watching a possible bear flag formation within a consolidation channel. We’re approaching long-term resistance marked by a two-year-old trendline and Fibonacci levels, suggesting significant downside risks remain.

I’m leaning rather pessimistic on both the S&P and the Nasdaq this week.

Emini S&P September Futures

• Emini S&P is again testing the strong resistance at 5350/5360 (the US500 contract is about 26 points below this price) but rose to 5385 before reversing. I still think there is a good chance we turn lower on Monday. Targets: 5320, 5295, 5275. A break above 5385 is a buy signal with the target at 5400 and resistance at 5420/30, as stops above 5440 are needed for profit-taking on longs and shorts.

Nasdaq September Futures

• The Emini Nasdaq encountered resistance at 18630/730 (the US100 contract is about 105 points above this) and reached a weekly high right here.

• Shorts need stops above 18850 and a breakout to the upside is a buy signal with the target 19000/19100 for profit taking on longs. Targets for shorts at 18630/730 are 18480 and 18330, maybe even 18200.