MNI DAILY TECHNICAL ANALYSIS - Back to All-Time Highs for US Equities

Price Signal Summary – Back to All-Time Highs For US Equities

• In the equity space, S&P E-minis traded higher Thursday and registered a fresh all-time high for the contract of 4543.25. This confirms a resumption of the uptrend and paves the way for an extension of gains. The focus is on 4591.25, a Fibonacci projection. EUROSTOXX 50 futures have recently cleared the 50-day EMA. The clear breach of this average and the recent break of a number of resistance points has exposed 4200.50, the Sep 24 high.
• In FX, EURUSD is consolidating. Price action this week resulted in a break of the 20-day EMA and this suggests scope for a stronger short-term corrective bounce towards the 50-day EMA at 1.1696. The GBPUSD rally that started late September remains intact. The pair has recently cleared the 50-day EMA and Tuesday's climb confirmed a break of 1.3795, 76.4% of the Sep 14 -29 downleg. The breach opens 1.3913, Sep 14 high and the next key resistance.
• On the commodity front, Gold is firmer this week. For bulls, a break of $1800.6 would reinstate the recent bullish theme, but the overarching sentiment remains bearish. WTI trend conditions remain bullish and this week's fresh trend high maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend.
• In the FI space, trend conditions remain bearish. Bund futures remain in a downtrend and have traded lower again today. The break this week of support at 168.21, Oct 12 low resumes the downtrend and paves the way for weakness towards 167.79 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low on the continuation chart. Gilt futures remain bearish and the contract traded to a fresh trend low yesterday of 123.43, confirming a resumption of the downtrend.

FOREIGN EXCHANGE

EURUSD TECHS: Consolidation Mode

• RES 4: 1.1821 High Sep 16
• RES 3: 1.1731/55 Bear channel from Jun 1 high / High Sep 22
• RES 2: 1.1696 50-day EMA
• RES 1: 1.1669 High Oct 19
• PRICE: 1.1628 @ 06:09 BST Oct 22
• SUP 1: 1.1572/24 Low Oct 18 / Low Oct 12 and the bear trigger
• SUP 2: 1.1493 50.0% retracement of the Mar '20 - Jan '21 bull phase
• SUP 3: 1.1469 1.236 proj of the Jan 6 - Mar 31 - May 25 price swing
• SUP 4: 1.1396 Bear channel base drawn from the Jun 1 high

EURUSD is consolidating. Price action this week resulted in a break of the 20-day EMA and this suggests scope for a stronger short-term corrective bounce towards the 50-day EMA at 1.1696. Note there is a key resistance at 1.1731, the top of a bear channel drawn from the Jun 1 high. Broader trend conditions remain bearish and short-term gains are considered corrective. Key support and the bear trigger is 1.1524.

GBPUSD TECHS: Holding Onto Recent Gains

• RES 4: 1.3983 High Jul 30
• RES 3: 1.3958 High Aug 4
• RES 2: 1.3913 High Sep 14 and a key resistance
• RES 1: 1.3854 High Sep 15
• PRICE: 1.3801 @ 06:15 BST Oct 22
• SUP 1: 1.3695 20-day EMA
• SUP 2: 1.3544 Low Oct 6
• SUP 3: 1.3428/12 2.0% 10-dma env / Low Sep 29 and bear trigger
• SUP 4: 1.3354 Low Dec 23, 2020

GBPUSD is consolidating and trading near recent highs. The rally that started late September remains intact. The pair has recently cleared the 50-day EMA and Tuesday's climb confirmed a break of 1.3795, 76.4% of the Sep 14 -29 downleg. The breach opens 1.3913, Sep 14 high and the next key resistance. On the downside, a firm short-term support is seen at 1.3695, the 20-day EMA.

EURGBP TECHS: Trend Signals Remain Bearish

• RES 4: 0.8624/58 High Oct 1 / High Sep 29
• RES 3: 0.8525 50-day EMA
• RES 2: 0.8518 High Oct 12 and a firm resistance
• RES 1: 0.8491 20-day EMA
• PRICE: 0.8426 @ 06:26 BST Oct 22
• SUP 1: 0.8421 Intraday low
• SUP 2: 0.8379 1.0% 10-dma envelope
• SUP 3: 0.8356 Low Feb 26, 2020
• SUP 4: 0.8339 Low Feb 25, 2020

EURGBP remains bearish - corrections are shallow and this reinforces current bearish sentiment signals. Furthermore, moving average conditions are in a bear mode, highlighting a downtrend. 0.8450, Oct 10 low and a key support has been cleared. This opens 0.8379 next, a vol based support. Further out, there is scope for an extension below 0.8400 to open 0.8356, the Feb 26, 2020 low. Initial firm resistance is 0.8518.

USDJPY TECHS: Dips Considered Corrective

• RES 4: 116.08 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 3: 115.51 High Mar 10, 2017
• RES 2: 114.99 1.50 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 1: 114.70/73 High Oct 20 / High Nov 6, 2017
• PRICE: 114.03 @ 06:31 BST Oct 22
• SUP 1: 113.65/00 Low Oct 15 & 21 / Low Oct 12
• SUP 2: 112.08 High Sep 30 and a recent breakout level
• SUP 3: 111.51 Low Oct 8
• SUP 4: 110.82/80 Low Oct 4 / High Aug 11

USDJPY is trading below recent highs. Dips are considered corrective and bullish remain intact. A strong bullish theme follows the recent break of a long-term trendline (at 113.41) drawn off the Dec 1975 high. Bulls have not looked back and momentum remains firm. Attention is on 115.51, the Mar 10 2017 high. On the downside, initial firm support is seen at 112.08, Sep 30 high and a recent breakout level.

EURJPY TECHS: Corrective Pullback

• RES 4: 134.40 2.382 proj of the Sep 22 - 29 - Oct 6 price swing
• RES 3: 134.13 High Jun 1 and a key resistance
• RES 2: 133.76 High Jun 10
• RES 1: 133.48 High Oct 20
• PRICE: 132.58 @ 06:38 BST Oct 22
• SUP 1: 132.15/131.08 Low Oct 18 / 20-day EMA
• SUP 2: 130.75 Sep 3 high
• SUP 3: 130.37 50-day EMA
• SUP 4: 129.28 Low Oct 11

Thursday's pullback in EURJPY is considered corrective. This week's gains confirmed an extension of the upleg that started Oct 6. The cross has also recently cleared 130.75, the Sep 3 high bull trigger and the rally maintains an impulsive bullish drive. The focus is on 133.76 next, Jun 10 high and 134.13, the Jun 1 high. Initial support is at 132.15, Oct 18 low. A break would suggest scope for a deeper corrective pullback.

AUDUSD TECHS: Bullish Price Sequence

• RES 4: 0.7716 High Jun 16
• RES 3: 0.7630 1.236 proj of the Aug 20 - Sep 3 - Sep 29 price swing
• RES 2: 0.7599 High Jul 6
• RES 1: 0.7546/57 High Oct 21 / 50.0% of the Feb - Aug sell-off
• PRICE: 0.7475 @ 06:45 BST Oct 22
• SUP 1: 0.7454 Intraday low
• SUP 2: 0.7379/55 Low Oct 18 / 50-day EMA
• SUP 3: 0.7288 Low Oct 8
• SUP 4: 0.7226/7170 Low Oct 6 / Low Sep 29

AUDUSD maintains a firmer short-term tone and Thursday's pullback is considered corrective. This week's gains have resulted in a break of 0.7478, the Sep 3 high and a bull trigger. The breach of this hurdle strengthens a bullish case and confirms a positive price sequence of higher highs and higher lows - the current bull phase started August 20. This has opened 0.7599 next, the Jul 6 high. Firm support is seen at 0.7355, the 50-day EMA.

USDCAD TECHS: Still Vulnerable

• RES 4: 1.2648 High Oct 6
• RES 3: 1.2544 50-day EMA
• RES 2: 1.2494 Low Sep 3 and a recent breakout level
• RES 1: 1.2410 High Oct 18
• PRICE: 1.2351 @ 06:50 BST Oct 22
• SUP 1: 1.2288 Low Oct 21
• SUP 2: 1.2253 Low Jun 23
• SUP 3: 1.2229 76.4% retracement of the Jun - Aug rally
• SUP 4: 1.2157 Low Jun 16

USDCAD is consolidating. The pair remains in a bear cycle and trend signals highlight potential for an extension lower. A bearish theme follows the recent break of the Jul 30 low of 1.2422. This has opened 1.2253 next, the Jun 23 low. Note too that moving average conditions remain in a bear mode, reinforcing current trend conditions. Initial firm resistance is seen at 1.2494, Sep 3 low. A break would ease bearish pressure.

FIXED INCOME

BUND TECHS: (Z1) Fresh Trend Lows

• RES 4: 171.72 High Sep 23
• RES 3: 170.76 50-day EMA
• RES 2: 170.55 High Oct 4
• RES 1: 169.48/92 High Oct 19 / High Oct 14 and key resistance
• PRICE: 168.04 @ 05:20 BST Oct 22
• SUP 1: 167.79 2.50 proj of the Sep 9 - 17 - 21 price swing
• SUP 2: 167.52 Low Mar 19 2020
• SUP 3: 166.33 Low May 21 2019
• SUP 4: 165.94 Low May 10 2019

Bund futures remain in a downtrend and have traded lower again today. The break this week of support at 168.21, Oct 12 low resumes the downtrend and paves the way for weakness towards 167.79 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low on the continuation chart. Moving average signals continue to point south, reinforcing current trend conditions. Initial key resistance is seen at 169.92, the Oct 14 high.

BOBL TECHS: (Z1) Still Heading South

• RES 4: 135.200 Low Sep 17, high Oct 4 and recent breakout level
• RES 3: 135.060 High Oct 7
• RES 2: 134.860 High Oct 14 and key resistance
• RES 1: 134.580 High Oct 18
• PRICE: 133.890 @ 05:27 BST Oct 22
• SUP 1: 133.800 Low Feb 26 and a key support
• SUP 2: 133.772 1.236 proj of the Oct 4 - 13 - 14 price swing
• SUP 3: 133.340 Low Mar 19 and key medium-term support
• SUP 4: 133.308 1.764 proj of the Oct 4 - 13 - 14 price swing

Bobl futures remain bearish and the contract traded to a fresh trend low once again yesterday. This confirms a resumption of the underlying downtrend and reinforces bearish conditions. Key resistance has been defined at 134.860, Oct 14 high and a breach of this level is required to signal scope for a short-term reversal. With momentum still pointing south, the focus is on 133.772 next, a Fibonacci projection.

SCHATZ TECHS: (Z1) Conditions Remain Bearish

• RES 4: 112.290 High Sep 20
• RES 3: 112.255 High Sep 23 and Oct 5 and key near-term resistance
• RES 2: 112.220 High Oct 14
• RES 1: 112.175 20-day EMA
• PRICE: 112.050 @ 05:25 BST Oct 22
• SUP 1: 112.025 2.00 proj of the Sep 20 - 28 - Oct 5 price swing
• SUP 2: 112.00 Round number support
• SUP 3: 111.990 Low Aug 14 and 26, 2020 (cont)
• SUP 4: 111.967 2.50 proj of the Sep 20 - 28 - Oct 5 price swing

From a trend perspective, Schatz futures are unchanged and remain in a downtrend although price action has been volatile this week. Fresh lows reinforce the downtrend and the break lower this week confirms a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. The focus is on 112.025 next, a Fibonacci projection. On the upside, initial resistance is at 112.175, the 20-day EMA.

GILT TECHS: (Z1) Resumes Its Downtrend

• RES 4: 126.84 Low Sep 17
• RES 3: 126.44 High Sep 24
• RES 2: 125.72 High Oct 1
• RES 1: 124.57/125.27 High Oct 19 / High Oct 14 and key resistance
• PRICE: 123.54 @ Close Oct 21
• SUP 1: 123.43 Low Oct 21
• SUP 2: 123.16 Low Feb 27, 2019 (cont)
• SUP 3: 122.75 2.236 proj of the Aug 31 - Sep 17 - 21 price swing
• SUP 4: 122.15 Low Jan 18, 2019 (cont)

Gilt futures remain bearish and the contract traded to a fresh trend low yesterday of 123.43, confirming a resumption of the downtrend. With momentum and moving average conditions still pointing south, further bearish pressure is likely and attention is on 123.16 next, the Feb 27, 2019 low. A break of the 123.00 handle is also likely near-term. Key near-term resistance has been defined at 125.27, the Oct 14 high.

BTP TECHS: (Z1) Bear Trend Intact

• RES 4: 155.14 High Aug 31
• RES 3: 154.64 High Sep 22 / 23
• RES 2: 153.59 High Sep 24
• RES 1: 152.54/87 High Oct 14 and key resistance / High Oct 1
• PRICE: 150.83 @ Close Oct 21
• SUP 1: 150.71 Low Oct 20, 21
• SUP 2: 150.56 Low Jun 30 (cont)
• SUP 3: 150.00/149.97 Round number support / Low Jun 25
• SUP 4: 148.77 61.8% retracement of the May - Aug rally (cont)

BTP futures outlook remains bearish. A key short-term resistance has been defined at 152.54, Oct 14 high where a break is required to signal a potential short-term base. With trend signals such as momentum and moving average studies still pointing south, a resumption of weakness would open 150.56 next, the Jun 30 low on the continuation chart. A test of the 150.00 handle is also seen likely further out.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Bull Flag Formation

• RES 4: 4234.50 0.764 projection of the Jul 19 - Sep 6 - 20 price swing
• RES 3: 4223.00 High Sep 6 and the bull trigger
• RES 2: 4200.50 High Sep 24
• RES 1: 4175.00 High Oct 15
• PRICE: 4169.00 @ 06:02 BST Oct 22
• SUP 1: 4103.20 50-day EMA
• SUP 2: 4004.00 / 3949.50 Low Oct 12 / Low Oct 6 and bear trigger
• SUP 3: 3902.50 Low Jul 20
• SUP 4: 3882.00 Low Jul 19 and a key support

EUROSTOXX 50 futures remain in a range and recent price action appears to be a bull flag. The contract has recently cleared the 50-day EMA. The clear breach of this average and the recent break of a number of resistance points has exposed 4200.50, the Sep 24 high. Above this level is the major resistance and bull trigger at 4223.00, Sep 6 high. On the downside, the 50-day EMA, at 4103.20 today, marks initial support.

E-MINI S&P (Z1): Fresh All-Time High

• RES 4: 4650.60 1.236 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 1: 4600.00 Round number resistance
• RES 3: 4591.25 1.00 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 1: 4543.25 High Oct 21
• PRICE: 4535.50 @ 07:02 BST Oct 22
• SUP 1: 4472.00 High Sep 27 and a recent breakout level
• SUP 2: 4398.57 50-day EMA
• SUP 3: 4317.25/4260.00 Low Oct 12 / Low Oct 1 and the bear trigger
• SUP 4: 4243.50 Low Jul 20

S&P E-minis traded higher Thursday and registered a fresh all-time high for the contract of 4543.25. This confirms a resumption of the uptrend and paves the way for an extension of gains. The focus is on 4591.25, a Fibonacci projection. Trend signals such as MA studies remain in a bull mode and this reinforces current trend conditions. A key support is at 4317.25, Oct 12 low. The 50-day EMA at 4409.06 represents an initial firm support handle.

COMMODITIES

BRENT TECHS: (Z1) Needle Still Points North

• RES 4: $90.00 - Psychological round number
• RES 3: $88.74 - 2.00 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 2: $86.55 - 1.764 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 1: $86.10 - High Oct 21
• PRICE: $84.01 @ 07:03 BST Oct 22
• SUP 1: $83.36 - Low Oct 21
• SUP 2: $82.20/81.84 - Low Oct 13 / 20-day EMA
• SUP 3: $79.08/78.75 - Low Oct 7 and key support / Low Oct 4
• SUP 4: $76.51/75.42 - Low Sep 30 and key support / High Sep 15

The bull trend in Brent futures remains intact and short-term pullbacks are considered corrective. Fresh highs this week confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Note too that the futures have recently cleared the $80.00 handle, an important psychological hurdle. The focus is on $86.55 next, a Fibonacci projection. Initial firm short-term support is seen at $81.84, the 20-day EMA.

WTI TECHS: (Z1) Bulls Pause For Breath

• RES 4: $87.45 - 1.236 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 3: $86.00 - Round number resistance
• RES 2: $85.01 - 1.00 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 1: $83.96 - High Oct 21
• PRICE: $81.97 @ 07:08 BST Oct 22
• SUP 1: $80.78 - Low Oct 20
• SUP 2: $78.78/70 - Low Oct 13 / 20-day EMA
• SUP 3: $74.67 - Low Oct 7 and key near-term support
• SUP 4: $73.92 - Low Oct 1

WTI trend conditions remain bullish and this week's fresh trend high maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend. Note that the $80.00 psychological hurdle has also recently been cleared, an important break. The focus is on $85.01 next, a Fibonacci projection. On the downside, a firm short-term support has been defined at $80.78, Oct 20 low.

GOLD TECHS: Remains Below Recent Highs

• RES 4: $1844.9 - Low Jun 14
• RES 3: $1834.1 - High Jul 15 and the bull trigger
• RES 2: $1808.7 - High Sep 14
• RES 1: $1800.6 - High Oct 14 and key short-term resistance
• PRICE: $1787.4 @ 07:21 BST Oct 22
• SUP 1: $1758.3 - Low Oct 13
• SUP 2: $1746.0 - Low Oct 6 and key near-term support
• SUP 3: $1721.7 - Low Sep 29 and the bear trigger
• SUP 4: $1717.8 - Low Aug 10

Gold is firmer this week. Attention though remains on the Oct 15 sharp sell-off and this highlights a potential bearish threat. Key short-term resistance has been defined at $1800.6, the Oct 14 high. A resumption of weakness would expose support at $1746.0, Oct 6 low and clearance of this level would reinforce a bearish threat and open $1721.7, Sep 29 low. For bulls, a break of $1800.6 would reinstate the recent bullish theme.

SILVER TECHS: Eyeing Key Resistance

• RES 4: $26.002 - High Aug 4
• RES 3: $25.206 - High Jun 8
• RES 2: $24.867 - High Sep 3 and the reversal trigger
• RES 1: $24.481 - High Oct 21
• PRICE: $24.197 @ 07:27 BST Oct 22
• SUP 1: $23.015 - Low Oct 18
• SUP 2: $22.213 - Low Oct 6
• SUP 3: $21.423 - Low Sep 29 and key support
• SUP 4: $20.871 - 50.0% retracement of the Mar '20 - Feb '21 rally

The current bull cycle in Silver remains intact. The metal has recently cleared both the 20- and 50 day EMAs. An extension of the rally would pave the way for $24.867, the Sep 3 high and a key near-term resistance. Clearance of this hurdle would strengthen the case for bulls and open the $26.00 handle. Initial firm support to watch is at $23.015, Oct 18 low. A break would threaten the current recovery.