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Gold Approaches A Key 5-Month Trendline Resistance

MARKET INSIGHT
  • In the equity space, current bullish conditions in S&P E-Minis remains intact. Fresh highs this week reinforces the current trend direction and this signals scope for a climb towards 4204.75 next, May 31 high and the next key resistance. Initial key support is 3991.98, the 50-day EMA. EUROSTOXX 50 futures trend conditions remain bullish and yesterday’s high print reinforces this theme. The contract has breached the 76.4% retracement of the Jun 6 - Jul 5 downleg, at 3722.40. Scope is seen for gains towards 3840.00, the Jun 6 high. Initial firm support to watch is 3592.30, the 50-day EMA.
  • In FX, the EURUSD short-term outlook is bullish and the pair remains above support at 1.0097, the Jul 27 low. A resumption of gains would signal scope for an extension higher within the bull channel - the top intersects at 1.0379. Weakness below 1.0097 would alter the picture. A bullish short-term theme in GBPUSD remains intact. Price has recently traded above the 50-day EMA. This reinforces current conditions with the next objective at 1.2332, the Jun 27 high. Potential is also seen for a climb towards 1.2406, the Jun 16 high and a key resistance. Initial firm support to watch lies at 1.2063, the Jul 29 low. USDJPY remains above support at 130.41, Tuesday’s low. Gains are - for now - considered corrective. A resumption of weakness would open 130.00. Initial resistance is at 135.09, the 20-day EMA.
  • On the commodity front, Gold maintains a firmer tone. The yellow metal has breached the 50-day EMA and attention is on trendline resistance at $1802.1. A breach of the trendline would represent an important technical break and highlight a stronger reversal of the 5-month downtrend. A break would open $1825.1, the Jun 30 high. Initial firm support lies at $1754.4 the Aug 3 low. In the Oil space, WTI futures remain vulnerable and yesterday’s extension lower reinforces current bearish conditions. Price has breached support at $88.23, Jul 14 low and a key support. This opens $91.22, Jul 14 low.
  • In the FI space, a short-term bull cycle in Bund futures remains intact. Scope is seen for a climb to 159.79 next, the Apr 4 high (cont). Initial firm support is 154.77, the 20-day EMA. The trend condition in Gilts remain bullish and pullbacks are considered corrective. A resumption of gains would open 120.00. Support is at 116.93 20-day EMA.
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  • In the equity space, current bullish conditions in S&P E-Minis remains intact. Fresh highs this week reinforces the current trend direction and this signals scope for a climb towards 4204.75 next, May 31 high and the next key resistance. Initial key support is 3991.98, the 50-day EMA. EUROSTOXX 50 futures trend conditions remain bullish and yesterday’s high print reinforces this theme. The contract has breached the 76.4% retracement of the Jun 6 - Jul 5 downleg, at 3722.40. Scope is seen for gains towards 3840.00, the Jun 6 high. Initial firm support to watch is 3592.30, the 50-day EMA.
  • In FX, the EURUSD short-term outlook is bullish and the pair remains above support at 1.0097, the Jul 27 low. A resumption of gains would signal scope for an extension higher within the bull channel - the top intersects at 1.0379. Weakness below 1.0097 would alter the picture. A bullish short-term theme in GBPUSD remains intact. Price has recently traded above the 50-day EMA. This reinforces current conditions with the next objective at 1.2332, the Jun 27 high. Potential is also seen for a climb towards 1.2406, the Jun 16 high and a key resistance. Initial firm support to watch lies at 1.2063, the Jul 29 low. USDJPY remains above support at 130.41, Tuesday’s low. Gains are - for now - considered corrective. A resumption of weakness would open 130.00. Initial resistance is at 135.09, the 20-day EMA.
  • On the commodity front, Gold maintains a firmer tone. The yellow metal has breached the 50-day EMA and attention is on trendline resistance at $1802.1. A breach of the trendline would represent an important technical break and highlight a stronger reversal of the 5-month downtrend. A break would open $1825.1, the Jun 30 high. Initial firm support lies at $1754.4 the Aug 3 low. In the Oil space, WTI futures remain vulnerable and yesterday’s extension lower reinforces current bearish conditions. Price has breached support at $88.23, Jul 14 low and a key support. This opens $91.22, Jul 14 low.
  • In the FI space, a short-term bull cycle in Bund futures remains intact. Scope is seen for a climb to 159.79 next, the Apr 4 high (cont). Initial firm support is 154.77, the 20-day EMA. The trend condition in Gilts remain bullish and pullbacks are considered corrective. A resumption of gains would open 120.00. Support is at 116.93 20-day EMA.