MNI DAILY TECHNICAL ANALYSIS - Bear Threat in Gilts Present
Price Signal Summary – Bear Threat in Gilts Still Present
- A bull cycle in S&P E-Minis remains intact and the latest shallow pullback appears to have been a correction. Note that moving average studies are in a bull-mode setup, highlighting a dominant uptrend and positive market sentiment. Eurostoxx 50 futures recently breached resistance at 5024.00, the Sep 3 high. This confirmed a resumption of the bull leg that started Aug 5 and cancels a recent bearish theme. It also suggests that the pullback last week is likely a correction.
- GBPUSD maintains a softer short-term tone following last week’s sell-off and the pair is trading at its recent lows. Price has breached support at the 20-day EMA and pierced the 50-day EMA at 1.3114. USDJPY traded higher Friday, as the pair extended the rally that started Sep 16 and price is trading at the latest highs. Last week’s gains resulted in a break of the 50-day EMA. An uptrend in AUDUSD remains intact, however the latest pullback highlights a short-term corrective cycle. The pair has traded through the 20-day EMA, and this exposes the next important support at 0.6752, the 50-day EMA.
- Gold remains in consolidation mode. The trend condition is also unchanged and bulls remain in the driver’s seat. Recent gains confirm a resumption of the primary uptrend and maintain the bullish price sequence of higher highs and higher lows.WTI futures traded higher Thursday, extending the rally that started on Oct 1. Short-term gains appear to be corrective, however, the break of the 50-day EMA suggests potential for an extension near-term.
- Bund futures traded sharply lower Friday. The reversal has resulted in a move through both the 20- and 50-day EMAs and undermines a recent bullish outlook. A continuation lower would further strengthen a developing bearish threat. A bear threat in Gilt futures remains present and Friday’s impulsive sell-off reinforces this theme. The contract has traded through support at 98.11, the Sep 2 low and a bear trigger.
FOREIGN EXCHANGE
EURUSD TECHS: Bearish Reversal
- RES 4: 1.1276 High Jul 18 2023
- RES 3: 1.1214/34 High Sep 25 / 1.618 proj Jun 26-Jul 17-Aug 1 swing
- RES 2: 1.1086/1144 20-day EMA / High Oct 1
- RES 1: 1.1041 50-Day EMA
- PRICE: 1.0968 @ 06:04 BST Oct 7
- SUP 1: 1.0951 Low Oct 4
- SUP 2: 1.0940 61.8% retracement of the Aug 1 - 26 bull leg
- SUP 3: 1.0909 Low Aug 9
- SUP 4: 1.0878 76.4% retracement of the Aug 1 - 26 bull leg
EURUSD traded lower Friday and a softer tone remains intact. The pair has traded through support at 1.1002, the Sep 11 low and what appears to be the midpoint of a double top reversal pattern on the daily chart. The break lower strengthens a bearish theme and signals scope for weakness towards 1.0940, a Fibonacci retracement point. Initial firm resistance is at 1.1086, the 20-day EMA. First resistance is at 1.1041, the 50-day EMA.
GBPUSD TECHS: Maintains A Softer Tone
- RES 4: 1.3434 High Sep 26 and key resistance
- RES 3: 1.3389 High Oct 1
- RES 2: 1.3305 High Oct 2 and the bull trigger
- RES 1: 1.3231 20-day EMA
- PRICE: 1.3118 @ 06:21 BST Oct 7
- SUP 1: 1.3070 Low Oct 4
- SUP 2: 1.3049 50.0% retracement of the Aug 8 - Sep 25 bull leg
- SUP 3: 1.3002 Low Sep 11
- SUP 4: 1.2959 61.8% retracement of the Aug 8 - Sep 25 bull leg
GBPUSD maintains a softer short-term tone following last week’s sell-off and the pair is trading at its recent lows. Price has breached support at the 20-day EMA and pierced the 50-day EMA at 1.3114. A clear break of this average would strengthen a bearish threat and open 1.3049, a Fibonacci retracement. Clearance of this level would expose 1.3002, the sep 11 low. Initial resistance to watch is 1.3231, the 20-day EMA.
EURGBP TECHS: Monitoring Resistance
- RES 4: 0.8494 High Aug 26
- RES 3: 0.8464 High Sep 11 and key resistance
- RES 2: 0.8444 High Sep 18
- RES 1: 0.8434 High Oct 3
- PRICE: 0.8362 @ 06:34 BST Oct 7
- SUP 1: 0.8311 Low Oct 1
- SUP 2: 0.8276 3.382 projection of the Aug 8 - 13 - 14 price swing
- SUP 3: 0.8250 Low Apr 14 ‘22
- SUP 4: 0.8203 Low Mar 7 2022 and a major support
The trend condition in EURGBP remains bearish, however, last Thursday’s strong rally highlights possible reversal. Note that the cross is trading close to the base of its 0.9300 - 0.8300 multi-year range and a key area of support. Moving average studies remain in a bear-mode position, highlighting a dominant downtrend - for now. Key support is at 0.8311, the Oct 1 low. Key resistance is 0.8464, the Sep 11 high. First resistance is 0.8434, Oct 23 high.
USDJPY TECHS: Holding On To Its Recent Gains
- RES 4: 153.40 61.8% retracement of the Jul 3 - Sep 16 bear leg
- RES 3: 151.94 Low Jul 25
- RES 2: 150.76 50.0% retracement of the Jul 3 - Sep 16 bear leg
- RES 1: 149.39 High Aug 15 and a reversal trigger
- PRICE: 148.45 @ 06:54 BST Oct 7
- SUP 1: 145.92/144.61 Low Oct 4 / 20-day EMA
- SUP 2: 141.65 Low Sep 30
- SUP 3: 140.45 Low Sep 18
- SUP 4: 139.58 Low Sep 16 and the bear trigger
USDJPY traded higher Friday, as the pair extended the rally that started Sep 16 and price is trading at the latest highs. Last week’s gains resulted in a break of the 50-day EMA. This undermines a recent bearish theme and highlights a stronger reversal. Sights are on 149.39, Aug 15 high. Clearance of this level would strengthen the bullish theme. Initial firm support is 144.61, the 20-day EMA. A break of the average is required to signal a reversal.
EURJPY TECHS: Key Resistance Remains Intact For Now
- RES 4: 166.53 High Jul 31
- RES 3: 165.00 Round number resistance
- RES 2: 163.89 High Aug 15 and a reversal trigger
- RES 1: 163.57 Intraday high
- PRICE: 162.75 @ 07:06 BST Oct 7
- SUP 1: 160.33 20-day EMA
- SUP 2: 158.11/155.15 Low Sep 30 / Low Sep 16
- SUP 3: 154.42 Low Aug 5 and the bear trigger
- SUP 4: 153.87 Low Dec 14 ‘23
EURJPY traded higher this week, resulting in a break above the 50-day EMA of 161.52. Key short-term resistance is unchanged at 163.49, the Sep 27 high (pierced), and 163.89, the Aug 15 high. A clear break of both price points would highlight a potential reversal. For now, trend signals remain bearish and gains are still considered corrective. A resumption of bearish price action would open 154.42, Aug 5 low and the bear trigger.
AUDUSD TECHS: Corrective Pullback Extends
- RES 4: 0.7029 High Feb 14 ‘23
- RES 3: 0.7003 2.0% 10-dma envelope
- RES 2: 0.6984 0.764 proj of the Aug 5 - 29 - Sep 11 price swing
- RES 1: 0.6889/6942 High Oct 3 / High Sep 30 and the bull trigger
- PRICE: 0.6798 @ 07:28 BST Oct 7
- SUP 1: 0.6786 Low Oct 4
- SUP 2: 0.6752 50-day EMA
- SUP 3: 0.6692 Low Sep 13
- SUP 4: 0.6622 Low Sep 11 and key support
An uptrend in AUDUSD remains intact, however the latest pullback highlights a short-term corrective cycle. The pair has traded through the 20-day EMA, and this exposes the next important support at 0.6752, the 50-day EMA. A clear break of this average would undermine a bullish theme and signal scope for a deeper retracement. Key resistance and the bull trigger has been defined at 0.6942, the Sep 30 high.
USDCAD TECHS: Testing Resistance At The 50-Day EMA
- RES 4: 1.3739 High Aug 15
- RES 3: 1.3693 High Aug 19
- RES 2: 1.3647 High Sep 19 and key resistance
- RES 1: 1.3584/91 50-day EMA / High Oct 4
- PRICE: 1.3585 @ 07:55 BST Oct 7
- SUP 1: 1.3539 20-day EMA
- SUP 2: 1.3473/3420 Low Oct 2 / Low Sep 25 and the bear trigger
- SUP 3: 1.3413 Low Feb 9
- SUP 4: 1.3358 76.4% retracement of the Dec 27 ‘23 - Aug 5 bull run
The trend condition in USDCAD remains bearish and the latest recovery appears to be a correction - for now. Note that the pair has pierced 1.3584, the 50-day EMA. A clear break of this EMA would signal scope for a stronger recovery that would expose 1.3647, the Sep 19 high and a key resistance. Initial firm support is 1.3473, Oct 2 low. A breach would signal a resumption of the downtrend and expose 1.3420, Sep 25 low and bear trigger.
FIXED INCOME
BUND TECHS: (Z4) Bearish Threat
- RES 4: 137.00 Round number resistance
- RES 3: 136.20 High Oct 1 and the bull trigger
- RES 2: 135.24 High Oct 3
- RES 1: 134.59 20-day EMA
- PRICE: 133.93 @ 05:44 BST Oct 7
- SUP 1: 133.64 Low Oct 4
- SUP 2: 133.49 76.4% retracement of the Sep 2 - Oct 1 rally
- SUP 3: 132.65 Low Sep 2 and the bear trigger
- SUP 4: 132.25 Low Jul 29
Bund futures traded sharply lower Friday. The reversal has resulted in a move through both the 20- and 50-day EMAs and undermines a recent bullish outlook. A continuation lower would further strengthen a developing bearish threat. This would open 133.49, a Fibonacci retracement. A break of this level would expose 132.65, the Sep 2 low. Initial resistance is at 134.59, the 20-day EMA.
BOBL TECHS: (Z4) Trades Through Support
- RES 4: 120.650 High Oct 1 and key resistance
- RES 3: 120.190 High Oct 3
- RES 2: 119.870 High Oct 4
- RES 1: 119.753 20-day EMA
- PRICE: 119290 @ 06:00 BST Oct 7
- SUP 1: 119.230 Low Oct 4
- SUP 2: 119.069 76.4% retracement of the Sep 3 - Oct 1 bull leg
- SUP 3: 118.580 Low Sep 3 and a key support
- SUP 4: 118.00 Round number support
The trend condition in Bobl futures is bullish, however, last week’s reversal from the Oct 1 high, undermines the trend condition and signals scope for a deeper retracement. The contract has traded through a number of short-term retracement points and has breached the 20-day EMA. This move exposes 119.069, 76.4% of the Sep 3 - Oct 1 bull leg. A break of this level would expose 118.580, the Sep 3 low. Initial resistance is 119.753, the 20-day EMA.
SCHATZ TECHS: (Z4) Retracement Mode
- RES 4: 107.450 1.00 proj of the Sep 3 - 11 - 18 price swing
- RES 3: 107.225/335 High Oct 3 / 1 and key resistance
- RES 2: 107.110 High Oct 7
- RES 1: 104.014 20-day EMA
- PRICE: 107.845 @ 06:14 BST Oct 4
- SUP 1: 106.815 Low Sep 18
- SUP 2: 106.712 76.4% retracement of the Sep 3 - Oct 1 bull cycle
- SUP 3: 106.675 Low Sep 4
- SUP 4: 105.520 Low Sep 3 and a key support
A bull cycle in Schatz futures remains intact, however, a short-term bearish threat exists following last week’s reversal from the Oct 1 high. The contract has traded through the 20-day EMA and attention is on 106.815, the Sep 18 low. A break of this level would signal scope for a deeper retracement to 106.712, a Fibonacci retracement. On the upside, initial resistance to watch is 107.014, the 20-day EMA. A clear break of it would signal a possible reversal.
GILT TECHS: (Z4) Southbound
- RES 4: 99.47 High Oct and key short-term resistance
- RES 3: 98.97 20-day EMA
- RES 2: 98.53 High Oct 3
- RES 1: 98.14 High Oct 4
- PRICE: 96.85 @ 08:01 BST Oct 7
- SUP 1: 96.73 Intraday low
- SUP 2: 96.23 1.00 proj of the Sep 17 - 30 - Oct 1 price swing
- SUP 3: 96.00 Round number support
- SUP 4: 95.47 1.236 proj of the Sep 17 - 30 - Oct 1 price swing
A bear threat in Gilt futures remains present and Friday’s impulsive sell-off reinforces this theme. The contract has traded through support at 98.11, the Sep 2 low and a bear trigger. The break strengthens the downtrend, signalling scope for a deeper retracement, towards 96.23 potentially, a Fibonacci projection. Initial firm resistance has been defined at 99.47, the Oct 1 high and just above the 20-day EMA.
BTP TECHS: (Z4) Corrective Cycle
- RES 4: 123.40 3.500 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 3: 123.12 3.382 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 2: 122.78 3.236 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 1: 121.67/122.62 High Oct 3 / 1 and the bull trigger
- PRICE: 120.85 @ Close Oct 4
- SUP 1: 120.54/17 Low Oct 4 / Low Sep 19
- SUP 2: 119.32 Low Sep 9
- SUP 3: 118.85 Low Sep 4
- SUP 4: 118.16 Low Sep 2 and key support
The medium-term trend condition in BTP futures is bullish and last Tuesday’s rally reinforces this theme. However, a short-term bearish threat exists for now, following the reversal from the Oct 1 high. This highlights a corrective cycle. The contract has pierced the 20-day EMA, at 120.86. A continuation lower would open 120.17, the Sep 19 low. On the upside, the bull trigger has been defined at 122.62, the Oct 1 high.
EQUITIES
EUROSTOXX50 TECHS: (Z4) Support Remains Intact
- RES 4: 5256.00 1.00 proj of the Aug 5 - Sep 3 - 6 price swing
- RES 3: 5200.00 Round number resistance
- RES 2: 5138.24 0.764 proj of the Aug 5 - Sep 3 - 6 price swing
- RES 1: 5048.00/5106.00 High Oct 1 / High Sep 30 and the bull trigger
- PRICE: 4995.00 @ 06:21 BST Oct 7
- SUP 1: 4925.27 50-day EMA
- SUP 2: 4848.00/4757.00 Low Sep 13 / Low Sep 6 and 10
- SUP 3: 4813.00 Low Sep 12
- SUP 4: 4757.00 Low Sep 6 / 10 and key support
Eurostoxx 50 futures recently breached resistance at 5024.00, the Sep 3 high. This confirmed a resumption of the bull leg that started Aug 5 and cancels a recent bearish theme. It also suggests that the pullback last week is likely a correction. Key short-term support to watch is 4925.27, the 50-day EMA. A clear break of this average would signal scope for a deeper retracement. Key resistance and the bull trigger is 5106.00, the Sep 30 high.
E-MINI S&P: (Z4) Trend Structure Remains Bullish
- RES 4: 5900.00 Round number resistance
- RES 3: 5871.77 2.0% Upper Bollinger Band
- RES 2: 5868.50 1.00 proj of the Apr 19 - Jul 16 - Aug 5 price swing
- RES 1: 5830.00 High Sep 26
- PRICE: 5793.25 @ 07:12 BST Oct 7
- SUP 1: 5735.68 20-day EMA
- SUP 2: 5666.17 50-day EMA
- SUP 3: 5500.00 Round number support
- SUP 4: 5451.25 Low Sep 6 and a bear trigger
A bull cycle in S&P E-Minis remains intact and the latest shallow pullback appears to have been a correction. Note that moving average studies are in a bull-mode setup, highlighting a dominant uptrend and positive market sentiment. Scope is seen for a climb towards 5868.50, a Fibonacci projection, and 5900.00 further out. On the downside, initial support to watch is 5735.68, the 20-day EMA. Key support lies at 5666.17 the 50-day EMA.
COMMODITIES
BRENT TECHS: (Z4) Bull Cycle Remains In Play
- RES 4: $83.02 - High Jul 18
- RES 3: $81.47 - 76.4% retracement of the Jul 5 - Sep 10 bear leg
- RES 2: $79.68 - High Aug 26
- RES 1: $79.30 - HIgh Oct 4
- PRICE: $77.78 @ 07:00 BST Oct 7
- SUP 1: $73.99 - 20-day EMA
- SUP 2: $69.91/68.29 - Low Oct 1 / 10 and the bear trigger
- SUP 3: $67.73 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing
- SUP 4: $66.12 - 1.764 proj of the Apr 12 - Jun 4 - Jul 5 price swing
Brent futures traded sharply higher last week and for now, the contract is holding on to its gains. It is still possible that the recent rally is a correction, however, the clear break of the 50-day EMA, suggests potential for a continuation higher near-term. Scope is seen for a climb towards $79.68 next, the Aug 26 high. Initial firm support to watch is $73.99, the 20-day EMA. A clear break would be seen as an early reversal signal.
WTI TECHS: (X4) Trading At Its Recent Highs
- RES 4: $79.69 - High Jul 18
- RES 3: $77.70 - 76.4% retracement of the Jul 5 - Sep 10 bear leg
- RES 2: $76.40 - High Aug 26
- RES 1: $75.57 - High Oct 4
- PRICE: $74.23 @ 07:08 BST Oct 7
- SUP 1: $70.56 - 20-day EMA
- SUP 2: $66.33/64.61 - Low Oct 1 / Low Sep 10 and the bear trigger
- SUP 3: $63.89 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing
- SUP 4: $60.00 - Psychological round number
WTI futures traded higher Thursday, extending the rally that started on Oct 1. Short-term gains appear to be corrective, however, the break of the 50-day EMA suggests potential for an extension near-term. This has exposed $76.40, the Aug 26 high. On the downside, initial support to watch is $70.56, the 20-day EMA. A clear break of this level would highlight a potential reversal and a resumption of the downtrend.
GOLD TECHS: Trend Needle Points North
- RES 4: $2708.4 - 2.764 proj of the Jul 25 - Aug 2 - Aug 5 price swing
- RES 3: $2697.9 - 3.0% 10-dma envelope
- RES 2: $2690.2 - 2.618 proj of the Jul 25 - Aug 2 - Aug 5 price swing
- RES 1: $2685.6 - High Sep 26 and the bull trigger
- PRICE: $2641.5 @ 07:15 BST Oct 7
- SUP 1: $2624.8 - Low Sep 30
- SUP 2: $2612.1 - 20-day EMA
- SUP 3: $2584.9 - Low Sep 20
- SUP 4: $2540.4 - 50-day EMA
Gold remains in consolidation mode. The trend condition is also unchanged and bulls remain in the driver’s seat. Recent gains confirm a resumption of the primary uptrend and maintain the bullish price sequence of higher highs and higher lows. MA studies are in a bull-mode set-up too, highlighting a clear uptrend and positive market sentiment. The focus is on $2690.2 next, a Fibonacci projection. Firm support lies at $2612.1, the 20-day EMA.
SILVER TECHS: Bullish Outlook
- RES 4: $33.738 - 1.618 proj of the Aug 8 - 26 - Sep 6 price swing
- RES 3: $33.297 - 1.50 proj of the Aug 8 - 26 - Sep 6 price swing
- RES 2: $33.000 - Round number resistance
- RES 1: $32.963 - High Sep 26
- PRICE: $31.856 @ 08:03 BST Oct 7
- SUP 1: $30.976/30.068 - 20- and 50-day EMA values
- SUP 2: $28.535 - Low Sep 12
- SUP 3: $27.686 - Low Sep 6 and a key support
- SUP 4: $27.180 - Low Aug 14
Bullish conditions in Silver remain intact and recent gains reinforce this set-up. The metal has recently traded through resistance at $31.754, the Jul 11 high. Note too that price has also pierced $32.518, the May 20 high and a key resistance. A clear break of this hurdle would confirm a resumption of the medium-term uptrend and open $33.297, a Fibonacci projection. Firm support lies at $30.068, the 50-day EMA.