Markets at the Brink: Record Highs Meet a Reality Check
Chart Book for 17th August 2026
Markets gave us a constructive but uneasy week. The S&P 500 added 0.4%, setting a record before Friday’s soft retail-sales report pulled it back to 7,785.76. July sales fell 0.6%, while unchanged producer prices encouraged hopes that the Fed can stay patient; higher oil and Treasury yields stopped that story becoming an outright celebration.
EUR/USD finished near 1.1567, modestly firmer over the week as the dollar softened on Friday. The pair remains caught between gentler US data and an ECB that still sounds cautious rather than eager to loosen. Bitcoin was less convincing, drifting around $62,900 inside its $60,000–66,000 range. Crypto sentiment feels watchful, not panicked, but buyers haven’t yet found a persuasive catalyst.
Oil supplied the week’s tension. WTI ended around $82.40 after demand concerns and higher inventories pressured prices midweek, only for renewed Iran-related risk to restore a geopolitical premium on Friday. Gold benefited from that mix of softer data, dollar weakness and geopolitical nerves, finishing near $4,435—still doing double duty as safe haven and inflation hedge.
London had a tougher time. The FTSE 100 closed at 10,750 after five consecutive declines, with miners dragging, although oil majors offered some support. Tesla gained roughly 3.8% to about $341, helped by friendlier rate expectations and Roadster speculation, while Nvidia held near $225 and remained an AI favourite, with robotics adding another strand to the growth narrative.
Looking ahead, we’ll watch US housing starts, industrial production, jobless claims and Wednesday’s FOMC minutes. UK labour and inflation data matter for the FTSE and sterling, while final eurozone CPI and comments from Christine Lagarde and Philip Lane could shake EUR/USD. Home Depot, Lowe’s and Walmart will provide a useful consumer check.
Technically, 7,820–7,850 caps the S&P; EUR/USD needs 1.1600; Bitcoin needs $66,500. Watch $80 in WTI, $4,430 in gold, 10,700 on the FTSE, $350 for Tesla and $227 for Nvidia. We’re cautiously optimistic—but this is a market with little room for disappointment.
Introduction to our Chart Book
In today’s volatile market environment, our technical analysis provides a clear, data-driven framework to support informed investment decisions. By evaluating price action, momentum indicators, and trend behavior across equities, commodities, and indices, we identify key support and resistance levels, reversal signals, and emerging opportunities. Using tools such as Elliott Wave theory, MACD, and Stochastics, we deliver actionable insights to improve trade timing, manage risk, and capture short- to medium-term market moves. This disciplined approach enhances precision and confidence for investors navigating shifting economic conditions.
Read on for our Technical Analysis:
EURUSD - 2 hour chart
EUR/USD is recovering from its late-July base around 1.1350, but it’s now testing a resistance cluster at 1.1570–1.1600. This zone includes several June and August reaction highs, so we’d treat a clean close above 1.1600 as confirmation of a larger reversal. That would expose 1.1650 and then 1.1700–1.1750. Immediate support sits around 1.1525–1.1535, followed by 1.1480–1.1500. Losing 1.1480 would weaken the recovery and put 1.1400 back in play.
The August price action resembles an ascending consolidation following the sharp rebound from 1.1370. Higher lows are developing, but resistance near 1.1570 has repeatedly contained advances. That combination could become an ascending triangle, with a measured breakout objective around 1.1700. Until 1.1600 gives way, however, we’re still dealing with a range inside the broader decline from the February high.
MACD is marginally positive. The MACD line is around 0.00092, above the signal near 0.00056, with a small positive histogram around 0.00036. Momentum is improving, though the readings remain close to zero and therefore lack conviction. A stronger expansion above zero accompanying a price breakout would make the bullish signal much more credible.
Stochastic RSI is elevated but not fully extreme, near 76 and 62. The faster line leading the slower one shows positive short-term momentum. We’d watch for an overbought crossover above 80 or, alternatively, a bearish turn if price again fails at 1.1570–1.1600.
In Elliott terms, the decline from May may have completed five waves near 1.1350. The current recovery could be the opening wave of a new advance, although its overlapping character also fits an A-B-C correction. A break above 1.1600 favours a developing third wave or wave C; a reversal below 1.1480 would keep the corrective interpretation dominant.
S&P 500
ES remains the strongest chart in this group, holding close to record highs around 7,820 after breaking decisively above the July range. The immediate resistance zone is 7,820–7,850; beyond that, 7,900 and the psychological 8,000 level become natural targets. First support lies around 7,760–7,780, with the more important breakout support at 7,680–7,720. A decline below 7,680 would turn the recent breakout into a possible bull trap and expose 7,550–7,600.
Price is forming a tight shelf just beneath the high. We’d normally regard that as constructive because sellers have failed to force a meaningful retracement after the early-August surge. However, the inability to expand above 7,820 also leaves room for a short-term double top. The next breakout or support failure should therefore carry useful information.
MACD remains above zero, but momentum has softened materially. The MACD line is approximately 7.37 versus an 11.14 signal, producing a negative histogram near -3.77. We read this as deceleration within an established uptrend, not yet a bearish reversal. A bullish recross would support another high; continued weakening alongside a break below 7,760 would be a warning.
Stochastic RSI has collapsed to roughly 6–8, placing the market deeply oversold on this timeframe despite price remaining near its peak. That can provide fuel for another push higher, although it also highlights short-term internal weakness. We’d look for the oscillator to turn up while support holds.
The advance from the March low can be interpreted as a five-wave impulse. The July pullback may have been wave four, with August’s breakout representing wave five. If so, upside remains possible, but late-wave conditions increase reversal risk. A failure below 7,680 would suggest wave five has ended; continued trade above 7,850 would favour extension toward 7,900–8,000.
Bitcoin (BTC/USD)
Bitcoin remains trapped in a broad consolidation following June’s collapse from above $80,000. Price is currently near $62,900, with immediate support around $62,000–62,500 and stronger demand near $60,000–60,500. The July low around $58,000 is the major downside reference. Resistance is layered at $64,000–64,500, followed by $65,500–66,500. We’d need a decisive break above $66,500 to establish a higher high and materially improve the structure.
Since the initial plunge, BTC has formed a loose sideways triangle or rectangle between roughly $60,000 and $66,000. Recent highs have edged lower while buyers continue to defend the low-$62,000 region, creating compression. A break below $62,000 would tilt the range toward $60,000 and possibly $58,000; reclaiming $64,500 would reopen the upper boundary.
MACD remains below zero, with the MACD line around -135 and signal near -167, but the histogram is positive by roughly 31. We’re seeing bearish momentum moderate rather than a full bullish reversal. The fast line is above the signal line, which offers a modest positive divergence, yet both remain negative. Confirmation would require MACD to cross above zero while price breaks resistance.
Stochastic RSI has jumped to around 81, putting the fast reading just into overbought territory. That’s notable because price hasn’t broken out of its range. Unless BTC pushes through $64,000 quickly, the elevated oscillator may precede another rollover.
The June selloff can plausibly be counted as a five-wave decline ending near $59,000. Everything since then appears corrective and overlapping, consistent with an A-B-C rebound or wave-four consolidation. If that count is right, failure beneath $66,500 leaves another bearish fifth wave possible. A breakout above $66,500–67,000 would instead favour a completed correction and a more durable base.
Oil (WTI Crude)
WTI is consolidating around $82 after recovering from the July trough near $68. The immediate chart is range-bound, with support clustered at $80–81 and resistance around $84.50–85.50. A break above $85.50 would improve the short-term picture and target $88–90, where the last significant rally failed. Below $80, we’d look toward $77–78 and then $74–75. The larger chart remains capped by a sequence of lower highs from the April spike, so bulls still have work to do.
Recent price action resembles a compact sideways flag following the bounce from $75. The market has repeatedly found buyers below $81 but hasn’t generated enough momentum to clear $85. This compression should eventually produce a directional move; until then, entries near the edges of the range offer better risk/reward than trades around the middle.
MACD is essentially flat. The MACD line is near -0.02, the signal near -0.11, and the histogram marginally positive at about 0.09. We read that as a slight bullish bias but no meaningful trend impulse. A move above zero accompanied by price clearing $85 would provide much stronger confirmation. Conversely, another bearish cross while price loses $80 would favour a retest of the lower support zones.
Stochastic RSI has rebounded to approximately 78 and 68. It’s approaching overbought territory but hasn’t produced an extreme reading. The separation between the faster and slower lines suggests short-term buying pressure, though momentum could fade quickly at $84–85.
From an Elliott perspective, the $68 low may have completed a five-wave decline from the April high. The rally to $92 could be wave A, the retreat to $75 wave B, and the current recovery an incomplete wave C. That interpretation points toward $88–92, but a break below $75 would invalidate it and restore the dominant bearish sequence.
Gold (XAU/USD)
Gold has staged a forceful rebound from the $3,950–4,000 base, but it remains within the larger downtrend that began around $5,400. The rally has now reached a significant resistance band between $4,380 and $4,430, an area containing recent swing highs and previous breakdown structure. We’d need a sustained break above $4,430 to expose $4,500–4,550 and then $4,650. Near-term support sits around $4,330–4,350, followed by $4,250–4,280. The more important bullish invalidation area is near $4,180–4,200.
Price appears to have formed a rounded base through July and early August, followed by an impulsive breakout. The latest pause below $4,400 could develop into a bull flag, but it could equally become a lower high within the broader bearish structure. The reaction at $4,430 should help settle that question.
MACD has weakened after its strong positive surge. The MACD line is around -2.7 against a signal near -6.5, leaving the histogram positive at roughly 3.8. In practical terms, the fast line has pulled back sharply but remains above the signal line. We’re therefore seeing reduced momentum rather than a confirmed bearish reversal. A renewed upswing in both lines would support continuation; a bearish crossover would favour consolidation.
Stochastic RSI is near 89, placing gold firmly in overbought territory. That reading argues against chasing the rally at resistance and makes a retest of support quite plausible.
An Elliott count could identify the decline into July as a completed five-wave bearish sequence. The advance from $3,950 may then represent wave A of a larger corrective recovery, with the current pause potentially a shallow wave B or sub-wave four. If price clears $4,430, we could be entering wave C or a fifth sub-wave higher. A break beneath $4,250 would weaken that constructive count substantially.
UK100 Index
The FTSE has pulled back from a fresh high near 10,950–11,000 after a strong late-July breakout. The broader sequence of higher highs and higher lows remains intact, but price is now testing the first meaningful support area around 10,740–10,780. We see additional support at 10,680–10,700, which roughly corresponds to the breakout shelf, followed by 10,580–10,620. Resistance begins near 10,820 and becomes more substantial around 10,900–11,000.
The latest decline looks orderly rather than impulsive, resembling a descending channel or bull-flag retracement after the July surge. Holding above 10,700 would preserve that interpretation. A recovery through 10,825 could signal that the pullback has run its course, while a 2-hour close below 10,680 would suggest a deeper correction toward 10,600.
MACD has rolled modestly negative. The MACD line is near -19.2, below its signal around -17.3, with a histogram close to -1.9. That tells us bearish momentum is present but not particularly forceful. The lines are also relatively close to zero, consistent with consolidation rather than a major trend breakdown. We’d watch for the histogram to turn positive as an early sign that buyers are returning.
Stochastic RSI is neutral, around 52–53. It offers neither an overbought warning nor an oversold opportunity, leaving price structure as the better guide. A turn upward from this mid-range reading would complement a support bounce.
In Elliott terms, the advance from the late-March low may be counted as a developing five-wave sequence. The rally into early August could have completed wave three, with the present retreat forming wave four. That bullish count works while price holds roughly 10,600–10,700; a deeper break would raise the possibility that all five waves already ended near 11,000 and a larger A-B-C correction is underway.
Tesla
Tesla is attempting to recover from a sharp July–August decline, but the larger chart still carries a pattern of lower highs from the late-2025 peak near $495. The rebound from roughly $300 has reached $342, placing price directly beneath an important resistance band around $340–350. We’d want to see that zone reclaimed and held before calling this more than a countertrend bounce. Above it, $365–375 is the next obstacle, followed by $400. Initial support lies around $330, with stronger levels near $315 and $300.
The current recovery has a V-shaped character, although it’s running into the underside of the prior breakdown area. That makes $340–350 a useful decision zone: rejection would leave scope for another test of $315–320, whereas a clean breakout could trigger short covering toward $370.
MACD is constructive. The MACD line is near 4.19 versus a 3.28 signal, with a positive histogram around 0.91. We’re seeing improving upside momentum after a deeply negative reading during the selloff, but the indicator has only recently crossed into positive territory. Momentum therefore supports the rebound without yet confirming a durable trend reversal.
Stochastic RSI is extremely elevated, around 94 and 89. The bullish configuration can persist during a strong recovery, but at current resistance it also warns that near-term upside is stretched. We’d prefer either a controlled pullback that holds $330 or a decisive breakout rather than entering directly into the overbought reading.
An Elliott interpretation could label the decline from approximately $450 as a five-wave impulse ending near $300. The present advance may then be wave A of an A-B-C correction. Alternatively, $300 could mark a larger corrective low. A move above $375 would make the second interpretation more credible; rejection below $350 keeps the corrective-bounce count favoured.
NVIDIA
NVDA remains in a broadly bullish structure, with the latest advance pressing into resistance around $225–227. This area has capped several recent pushes, while the more important swing-high supply zone sits around $232–238. We’d treat a sustained 2-hour close above $227 as an early breakout signal, opening the way toward $235 and potentially the prior peak. Immediate support appears near $218–220, followed by $208–212. Below that, $198–202 is the key level protecting the medium-term uptrend.
The price action since the July low resembles a sequence of higher lows, although the repeated reversals around $225 make this look more like an ascending consolidation than a clean breakout. We’re also mindful that the latest rally is becoming compressed near resistance, so chasing strength before confirmation offers an unattractive risk/reward.
MACD remains above zero, with the MACD line around 2.76 and signal near 2.98. The slightly negative histogram shows that upside momentum is cooling even though the broader momentum regime remains positive. A fresh bullish crossover above the zero line would strengthen the breakout case; continued histogram deterioration would instead favour another pullback.
Stochastic RSI is near 79 and close to overbought territory. That doesn’t automatically imply a reversal, but it does suggest limited short-term room unless price can accelerate through resistance.
From an Elliott Wave perspective, the rise from the April 2025 low can plausibly be counted as a five-wave advance. The July 2026 low may have completed a wave-four correction, leaving the current push as wave five. That count remains tentative: failure below $218 would warn that the final leg is already tiring, while a break above $238 would support wave-five extension.
Glossary
Stochastic RSI (StochRSI):
The Stochastic RSI is a momentum indicator that combines the Stochastic Oscillator and the Relative Strength Index (RSI) to measure the speed and direction of price movements. It is primarily used to identify overbought or oversold conditions, helping traders anticipate potential trend reversals. By focusing on the relative position of the RSI within its recent range, StochRSI offers more sensitivity to price changes, making it ideal for spotting short-term trading opportunities.
MACD (Moving Average Convergence Divergence):
The MACD is a trend-following and momentum indicator that highlights changes in an asset's strength, direction, and duration. By comparing short-term and long-term moving averages, the MACD helps traders identify potential buy or sell signals and confirm the overall trend. Its histogram visually represents momentum, making it useful for gauging the strength of market moves and spotting potential reversals or continuations.
Elliot Wave:
Elliott Wave Theory, developed by Ralph Nelson Elliott in the 1930s, is a technical analysis tool that predicts market price movements through repetitive patterns called waves, driven by investor psychology. It suggests prices move in a cycle of eight waves: a 5-wave impulsive structure in the direction of the main trend (Wave 1 starts the trend, Wave 2 pulls back, Wave 3 is the strongest, Wave 4 pulls back again, and Wave 5 completes the trend), followed by a 3-wave corrective structure (Wave A moves against the trend, Wave B bounces, and Wave C moves against the trend again). These patterns repeat across different time scales, reflecting market sentiment swings between optimism and pessimism. By identifying these waves, traders can anticipate price movements and make better decisions on when to buy or sell.
Disclaimer: This article is for educational purposes only and should not be considered financial advice. Market conditions can change rapidly, and trading involves significant risk.
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