MNI DAILY TECHNICAL ANALYSIS - Bear Cycle In Treasuries Intact

Price Signal Summary - Trend Needle In Treasuries Points South      

• In the equity space, a bear threat in the S&P E-Minis contract remains present and short-term gains are considered corrective - for now. 5866.00, the Dec 20 low and a key short-term support, has been breached. This strengthens a bearish theme and sights are on 5784.00, the Nov 4 low and an important short-term support. Initial pivot resistance is seen at 5987.43, the 50-day EMA. A bull cycle in the EUROSTOXX 50 futures contract remains intact and the latest pullback appears corrective. Initial support is at 4939.33, the 50-day EMA. It has been pierced, a clear break of this EMA would undermine a bullish theme and signal scope for a deeper retracement. For bulls, resistance at 5040.00, Dec 9 high, has recently been pierced. Clearance of it would resume the bull cycle that started on Nov 21 and open 5068.13, the 0.764 projection of the Nov 21 - Dec 9 - 20 price swing.              
• In FX, the trend condition in EURUSD remains bearish and the latest recovery is considered corrective. Last week’s move lower resulted in a print below 1.0226, the Jan 2 low. The break of this support confirms a resumption of the downtrend and sights are on 1.0138 next, a 1.764 projection of the Sep 25 - Oct 23 - Nov 5 price swing. Resistance to watch is 1.0437, the Jan 6 high. Resistance at the 20-day EMA, is at 1.0356. The trend condition in GBPUSD remains bearish and the pair is trading closer to its recent lows. Recent weakness has confirmed a resumption of the downtrend and marks an extension of the price sequence of lower lows and lower highs. Sights are on 1.2087 next, a 0.764 projection of the Sep 26 - Nov 22 - Dec 6 price swing. Initial firm resistance is at 1.2433, the 20-day EMA. The trend condition in USDJPY is unchanged, it remains bullish and the pair is holding on to the bulk of its recent gains. The recent breach of 156.75, the Nov 15 high, confirmed a resumption of the uptrend and opens 159.45, the Jul 12 ‘24 high. Moving average studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support is 156.90, the 20-day EMA.  
• On the commodity front, recent gains in Gold appear corrective. However, the yellow metal continues to hold on to the bulk of last week’s gains and scope is seen for a continuation higher near-term. A stronger recovery would open $2726.2, the Dec 12 high and an important resistance. On the downside, a reversal lower would expose $2583.6, the Dec 19 low. Initial support is at $2644.3, the 50-day EMA. In the oil space, the trend structure in WTI futures remains bullish and the contract is trading just ahead of its recent highs. The stronger reversal to the upside has resulted in a breach of key short-term resistance at $76.41, the Oct 8 high. Clearance of this hurdle strengthens a bull theme and opens $79.59, the Jul 5 ‘24 high. On the downside, a reversal lower would expose the 20-day EMA, at $73.15. This average is seen as a key short-term support.         
• In the FI space, the trend in Bund futures is unchanged, it remains bearish and Tuesday’s fresh cycle low reinforces this theme. The contract has cleared key support at 132.00, the Nov 6 low. The clear break of this level strengthens a bearish theme. Sights are on the 130.00 handle next. Key short-term resistance is at 132.78, the 20-day EMA. Gains would be considered corrective. The trend condition in Gilt futures is unchanged, the direction remains down and last week’s fresh cycle lows reinforce current conditions. Recent weakness also highlights an acceleration of the trend. Sights are on 88.87 next, a 2.764 projection of the Dec 20 -27 - Jan 2 price swing. Initial resistance is at 90.31, the Jan 9 high. Resistance at the 20-day EMA, is at 91.61. The EMA is seen as an important hurdle for bulls.

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