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MNI DAILY TECHNICAL ANALYSIS - Bearish Threat Developing in EStoxx50

Price Signal Summary – Bearish Threat Developing in EStoxx50

  • S&P E-Minis are trading lower today. The contract has arrived at its key support area - the 50-day EMA. This average intersects at 4453.65 and marks a key pivot level. A clear break would strengthen a bearish case and allow for a deeper pullback that would open 4425.96 initially, a Fibonacci retracement. EUROSTOXX 50 futures traded lower Wednesday and in the process, price has moved below the 20- and 50-day EMAs and probed support at 3735.00, the Mar 18 low. The move lower undermines the recent bull theme and highlights a developing bearish threat.
  • EURUSD is trading at this week’s lows. The recent failure at 1.1185, Mar 31 high, and more importantly, the inability to remain above the 50-day EMA highlights a bearish threat and this week’s move lower has reinforced this theme. USDJPY is holding on to recent gains and remains above last week’s low of 121.28 (Mar 31). A corrective cycle is still in play though despite recent gains. 121.28 represents a key short-term support. A break of this level would allow for an extension lower and open 120.95, Mar 24 low. USDCAD has recovered from its recent lows and maintains a firmer tone. Tuesday’s price action, in Japanese candlestick terms, is a long-legged doji. This is a potential short-term reversal signal and if correct, suggests potential for a correction near-term.
  • Gold is unchanged and remains range bound, trading above $1890.2, the Mar 29 low. The outlook is bearish following the recent pullback from $2070.4, Mar 8 high. This has allowed a recent overbought condition to unwind. WTI futures traded lower Wednesday and this has resulted in a breach of the 50-day EMA. The move lower also marks an extension of the current bearish cycle and the print below the 50-day EMA suggests scope for a continuation lower near-term.
  • Bunds remain below Monday’s high and the recent corrective phase appears to be over. The primary trend is down. Moving average studies are in a bear mode and a broader bearish price sequence of lower lows and lower highs. Gilt futures have this week found resistance at 122.35, the Apr 4 high. The pullback means price has failed to remain above the 20-day EMA, and a key resistance at 122.72, the Mar 18 high, remains intact.

FOREIGN EXCHANGE

EURUSD TECHS: Trading At This Week’s Lows

  • RES 4: 1.1229 2.0% 10-dma envelope
  • RES 3: 1.1222 61.8% of Feb 10 - Mar 7 sell-off
  • RES 2: 1.1185/1203 High Mar 31 / 3.0% Upper Bollinger Band
  • RES 1: 1.1022 20-day EMA
  • PRICE: 1.0911 @ 06:23 BST Apr 7
  • SUP 1: 1.0875 Low Apr 6
  • SUP 2: 1.0806 Low Mar 7 and the bear trigger
  • SUP 3: 1.0767 Low May 7 2020
  • SUP 4: 1.0727 Low Apr 24, 2020

EURUSD is trading at this week’s lows. The recent failure at 1.1185, Mar 31 high, and more importantly, the inability to remain above the 50-day EMA highlights a bearish threat and this week’s move lower has reinforced this theme. The break of 1.0945, Mar 28 low, signals scope for a deeper sell-off towards 1.0806, the Mar 7 low and a bear trigger. Clearance of 1.1185 would reinstate a bull theme.

GBPUSD TECHS: Key 1.3000 Support Remains Exposed

  • RES 4: 1.3439 High Feb 25
  • RES 3: 1.3398 61.8% retracement of the Feb 10 - Mar 15 downleg
  • RES 2: 1.3269/98 50-day EMA / High Mar 23
  • RES 1: 1.3183 High Mar 30
  • PRICE: 1.3079 @ 06:29 BST Apr 7
  • SUP 1: 1.3046/3000 Low Apr 6 / Low Mar 15 and the bear trigger
  • SUP 2: 1.2954 1.764 proj of the Jan 13 - 27 - Feb 10 price swing
  • SUP 3: 1.2933 Low Nov 5 2020
  • SUP 4: 1.2855 Low Nov 2 2020 and a key support

GBPUSD remains in its recent range but is also trading at this week’s lows. Trend conditions remain bearish. The pair has recently failed to remain above a number of short-term resistance points and the pullback from 1.3298, Mar 23 high, means price continues to trade below the 50-day EMA, at 1.3269 today. The focus is on 1.3000, Mar 15 low and a bear trigger. Clearance of the 50-day EMA is required to highlight a short-term reversal.

EURGBP TECHS: Bear Cycle Likely To Extend

  • RES 4: 0.8624 High Oct 1 2021
  • RES 3: 0.8600 High Dec 8 2022
  • RES 2: 0.8512/59 High Mar 31 / 2.0% 10-dma envelope
  • RES 1: 0.8379/8435 50-day EMA / High Apr 4
  • PRICE: 0.8343 @ 06:36 BST Apr 7
  • SUP 1: 0.8322 Low Mar 28
  • SUP 2: 0.8296 Low Mar 23 and a key support
  • SUP 3: 0.8276 76.4% retracement of the Mar 7 - 31 rally
  • SUP 4: 0.8203 Low Mar 7 and the bear trigger

EURGBP remains vulnerable. This week’s move lower marks an extension of the reversal from the 0.8512 high on Mar 31. The recent move lower has also reversed a bullish theme, signalling scope for a continuation lower. The cross has traded through both the 20- and 50-day EMAs, opening 0.8296, the Mar 23 low. On the upside, Initial resistance is seen at Monday’s 0.8435 high. A break higher would ease bearish pressure.

USDJPY TECHS: Still Trading Below Its Key Resistance

  • RES 4: 126.26 3.382 proj of the Dec 3 ‘21 - Jan 4 -24 price swing
  • RES 3: 125.86 High Jun 5 2015 and a major resistance
  • RES 2: 125.28 High Aug 12 2015
  • RES 1: 124.30/125.09 High Mar 29 / High Mar 28 and the bull trigger
  • PRICE: 123.68 @ 06:43 BST Apr 7
  • SUP 1: 122.38/21.28 Low Apr 5 / Low Mar 31 and a bear trigger
  • SUP 2: 120.96 20-day EMA
  • SUP 3: 120.00 Round number support
  • SUP 4: 119.44 Low Mar 22

USDJPY is holding on to recent gains and remains above last week’s low of 121.28 (Mar 31). A corrective cycle is still in play though despite recent gains. 121.28 represents a key short-term support. A break of this level would allow for an extension lower and open 120.95, Mar 24 low ahead of the 120.00 handle. On the upside, clearance of 125.09, the Mar 28 high and bull trigger, would confirm a resumption of the primary uptrend.

EURJPY TECHS: Corrective Cycle Still In Play

  • RES 4: 139.00 High Aug 21 2015 and a key resistance
  • RES 3: 138.62 High Aug 25 2015
  • RES 2: 137.50/53 High Feb 2 ‘18 and major resistance / High Mar 28
  • RES 1: 135.88 High Apr 1
  • PRICE: 135.01 @ 06:49 BST Apr 7
  • SUP 1: 133.94 Low Mar 28
  • SUP 2: 133.31 20-day EMA
  • SUP 3: 131.61 50-day EMA
  • SUP 4: 130.72 Low Mar 17

EURJPY is consolidating. The recent pullback is still considered corrective and this is allowing an overbought condition to unwind. Support to watch is 133.94, Mar 28 low, a break would open the 20-day EMA at 133.31. The primary trend remains up. The cross traded to a fresh cycle high on Mar 28 and breached a key resistance at 134.13, Jun 1 2021 high, on Mar 24. This strengthened bullish conditions. The bull trigger is 137.50/53.

AUDUSD TECHS: Shooting Star Reversal

  • RES 4: 0.7776 High Jun 11 2021
  • RES 3: 0.7762 76.4% retracement of the Feb ‘21 - Jan ‘22 downleg
  • RES 2: 0.7716 High Jun 16 2021
  • RES 1: 0.7661/65 High Apr 5 / 2.0% 10-dma envelope
  • PRICE: 0.7483 @ 06:59 BST Apr 7
  • SUP 1: 0.7557/47 Low Mar 29 / 20-day EMA
  • SUP 2: 0.7376 Low Mar 22
  • SUP 3: 0.7346 50-day EMA
  • SUP 4: 0.7283 Low Mar 17

AUDUSD gains have found resistance at 0.7661, Apr 5 high. The continued move lower highlights a short-term bearish threat and suggests potential for a correction. Note that Tuesday’s session isa bearish candle reversal pattern - a shooting star - and yesterday’s weakness reinforces this pattern. A continuation lower would open 0.7447, the 20-day EMA. This average marks the next key support. Key resistance is at 0.7661.

USDCAD TECHS: Long-Legged Doji

  • RES 4: 1.2699 High Mar 17
  • RES 3: 1.2632 50-day EMA
  • RES 2: 1.2593 High Mar 28
  • RES 1: 1.2571 20-day EMA
  • PRICE: 1.2555 @ 07:26 BST Apr 7
  • SUP 1: 1.2479 Low Apr 6
  • SUP 2: 1.2403/2379 Low Apr 5 / 1.0% 10-dma envelope
  • SUP 3: 1.2387 Low Nov 10 2021
  • SUP 4: 1.2328 Low Oct 29 2021

USDCAD has recovered from its recent lows and maintains a firmer tone. Tuesday’s price action, in Japanese candlestick terms, is a long-legged doji. This is a potential short-term reversal signal and if correct, suggests potential for a correction near-term. A continuation higher would open the 50-day EMA that intersects at 1.2632 today. The broader trend remains down, key support and the bear trigger has been defined at 1.2403, Tuesday’s low.

FIXED INCOME

BUND TECHS: (M2) Trend Needle Still Points South

  • RES 4: 162.73 High Mar 14
  • RES 3: 161.81 High Mar 16
  • RES 2: 160.31 High Mar 23
  • RES 1: 159.79 High Apr 4 and key short-term resistance
  • PRICE: 157.52 @ 05:05 BST Apr 7
  • SUP 1: 156.84 Low Apr 6
  • SUP 2: 156.05/00 Low Mar 29 / Round number support
  • SUP 3: 155.70 Low Dec 7 2015 (cont)
  • SUP 4: 155.03 Low Dec 4 2015 (cont)

Bunds remain below Monday’s high and the recent corrective phase appears to be over. The primary trend is down. Moving average studies are in a bear mode and a broader bearish price sequence of lower lows and lower highs, that has unfolded since Aug / Sep 2019, remains intact. A continuation lower would open 156.00. Firm resistance is at 159.79, the Apr 4 high where a break is required to signal a possible base.

BOBL TECHS: (M2) Trend Structure Remains Bearish

  • RES 4: 130.828 50-day EMA
  • RES 3: 130.160 High Mar 23
  • RES 2: 129.596 20-day EMA
  • RES 1: 129.350 High Apr 4
  • PRICE: 128.650 @ 05:08 BST Apr 7
  • SUP 1: 127.770/750 Low Mar 29 / Low Jun 5 2015 (cont)
  • SUP 2: 127.540 Low Jun 4 2015 (cont)
  • SUP 3: 127.520 Low Sep 3 2014 (cont)
  • SUP 4: 127.280 Low Sep 18 2014 (cont)

Bobl futures remain above recent lows but price has pulled away from Monday’s high. The primary trend is down. Bearish price activity in March confirmed a resumption of the underlying downtrend to maintain the broader bearish price sequence of lower lows and lower highs. The focus is on a move towards 127.750 next, the Jun 5 2015 low (cont). The 20-day EMA at 129.596 marks a firm resistance.

SCHATZ TECHS: (M2) Bearish Theme

  • RES 4: 111.355 High Mar 21
  • RES 3: 111.170 High Mar 23
  • RES 2: 110.981 20-day EMA
  • RES 1: 110.855 High Apr 4
  • PRICE: 110.730 @ 05:15 BST Apr 7
  • SUP 1: 110.465 Low Mar 30 and the bear trigger
  • SUP 2: 110.410 Low May 8 2014 (cont)
  • SUP 3: 110.400 Round number support
  • SUP 4: 110.360 Low Apr 29 2014 (cont)

Schatz futures are consolidating but remain vulnerable and the recent move higher appears to be a correction. Recent fresh cycle lows strengthened bearish conditions and confirmed a resumption of the primary downtrend plus, it maintains the broader bearish price sequence of lower lows and lower highs. 111.00 has recently been cleared and this paves the way for a move towards 110.410 next. Firm resistance is seen at 110.981 the 20-day EMA.

GILT TECHS: (M2) Eyeing The Bear Trigger

  • RES 4: 124.60 High Mar 8
  • RES 3: 123.52 High Mar 9
  • RES 2: 122.72 High Mar 18 and a key near-term resistance
  • RES 1: 122.35 High Apr 4
  • PRICE: 120.19 @ Close Apr 6
  • SUP 1: 119.86 Low Mar 28 and the bear trigger
  • SUP 2: 119.75 123.6% retracement of the Feb 15 - Mar 1 climb
  • SUP 3: 119.36 Low Oct 10 2018 (cont)
  • SUP 4: 118.93 Low Apr 26 2016 (cont)

Gilt futures have this week found resistance at 122.35, the Apr 4 high. The pullback means price has failed to remain above the 20-day EMA, and a key resistance at 122.72, the Mar 18 high, remains intact. The broader trend direction is down. The bear trigger lies at 119.86, the Mar 28 low. For bulls, clearance of 122.72 would suggest scope for a stronger bullish short-term cycle.

BTP TECHS: (M2) Resumes Its Downtrend

  • RES 4: 142.51 Low Mar 1
  • RES 3: 140.71 High Mar 11
  • RES 2: 139.23 High Mar 23
  • RES 1: 138.68 High Mar 31 and key near-term resistance
  • PRICE: 134.95 @ Close Apr 6
  • SUP 1: 134.56 Low Apr 6
  • SUP 2: 134.00 Round number support
  • SUP 3: 132.61 Low Apr 22 2020 (cont)
  • SUP 4: 131.50 76.4% retracement of the Mar ‘20 - Aug ‘21 rally (cont)

BTP futures traded lower Wednesday confirming the end of the recent corrective cycle and marking a resumption of the primary downtrend. The move lower, also marks an extension of the breach of support at 138.60, Feb 16 low, and highlights a continuation of the broader bearish price sequence of lower lows and lower highs. The focus is on the 134.00 handle. Firm resistance is seen at 138.68, the Mar 31 high.

EQUITIES

EUROSTOXX50 TECHS: (M2) Bearish Threat

  • RES 4: 4132.00 High Feb 10
  • RES 3: 4072.00 High Feb 16
  • RES 2: 3944.00/3965.50 High Mar 29 / High Feb 23
  • RES 1: 3888.00 High Apr 5
  • PRICE: 3729.00@ 06:03 BST Apr 7
  • SUP 1: 3701.40 38.2% retracement of the Ma r 7 - 29 rally
  • SUP 2: 3626.50 50.0% retracement of the Ma r 7 - 29 rally
  • SUP 3: 3551.60 61.8% retracement of the Ma r 7 - 29 rally
  • SUP 4: 3523.00 Low Mar 11

EUROSTOXX 50 futures traded lower Wednesday and in the process, price has moved below the 20- and 50-day EMAs and probed support at 3735.00, the Mar 18 low. The move lower undermines the recent bull theme and highlights a developing bearish threat. An extension lower would open 3626.50, a Fibonacci retracement. On the upside, key short-term resistance has been defined at 3944.00, the Mar 29 high.

E-MINI S&P (M2): Has Arrived At Its 50-Day EMA

  • RES 4: 4730.50 High Jan 1
  • RES 3: 4663.50 High Jan 18
  • RES 2: 4633.44 76.4% retracement of the Jan 4 - Feb 24 downleg
  • RES 1: 4588.75 High Apr 5
  • PRICE: 4458.00 @ 05:33 BST Apr 7
  • SUP 1: 4453.65/4444.50 50-day EMA / Low Apr 6
  • SUP 2: 4425.96 38.2% retracement of the Feb 24 - Mar 29 rally
  • SUP 3: 4400.00 Round number support
  • SUP 4: 4363.85 50.0% retracement of the Feb 24 - Mar 29 rally

S&P E-Minis are trading lower today. The contract has arrived at its key support area - the 50-day EMA. This average intersects at 4453.65 and marks a key pivot level. A clear break would strengthen a bearish case and allow for a deeper pullback that would open 4425.96 initially, a Fibonacci retracement. On the upside, a resumption of gains and an ability to remain above the 50-day EMA would be seen as a bullish development.

COMMODITIES

BRENT TECHS: (M2) Testing Support At The 50-Day EMA

  • RES 4: $134.91 - High Mar 7 and key resistance
  • RES 3: $128.04 - High Mar 8
  • RES 2: $125.40 - 76.4% retracement of the Mar 7 - 16 downleg
  • RES 1: $112.28/119.74 - High Mar 30 / High Mar 24 and a bull trigger
  • PRICE: $102.93 @ 06:55 BST Apr 7
  • SUP 1: $100.59/54 50-day EMA / Low Apr 6
  • SUP 2: $94.61 - Low Mar 16 and a key support
  • SUP 3: $90.58 - Low Feb 25
  • SUP 4: $84.74 - Low Feb 18

Brent futures traded lower Wednesday. The contract has breached $102.19, Mar 29 low. A bearish threat remains present following the recent move lower from $119.74, Mar 24 high. Prices have traded below the 20-day EMA and attention is on the 50-day EMA, at $100.59. The 50-day average marks a key pivot support and a clear break would suggest scope for a deeper decline. $119.74 remains the key short-term resistance.

WTI TECHS: (K2) Trades Below The 50-Day EMA

  • RES 4: $122.73 - High Mar 9
  • RES 3: $116.64/118.34 - High Mar 24 / 76.4% of Mar 7 - 15 downleg
  • RES 2: $108.75/112.93 -High Mar 30 / High Mar 28
  • RES 1: $105.59 - High Apr 5
  • PRICE: $97.91 @ 07:01 BST Apr 7
  • SUP 1: $95.73 - Low Apr 6
  • SUP 2: $92.20 - Low Mar 15 and a bear trigger
  • SUP 3: $88.49 - Low Feb 25
  • SUP 4: $85.81 - Low Feb 18

WTI futures traded lower Wednesday and this has resulted in a breach of the 50-day EMA. The move lower also marks an extension of the current bearish cycle and the print below the 50-day EMA suggests scope for a continuation lower near-term. The focus is on the next key support at $92.20, the Mar 15 low. Initial firm resistance has been defined at $105.59, the Apr 5 high where a break would ease bearish pressure.

GOLD TECHS: Consolidation Mode

  • RES 4: $2104.6 - 3.236 proj of the Dec 15 - Jan 25 - 28 price swing
  • RES 3: $2075.5 - High Aug 7 2020 and the all-time high
  • RES 2: $2009.2/2070.4 - High Mar 10 / High Mar 8
  • RES 1: $1966.1 - High Mar 24
  • PRICE: $1924.3 @ 07:15 BST Apr 7
  • SUP 1: $1890.2 - Low Mar 29 and a bear trigger
  • SUP 2: $1878.4 - Low Feb 24
  • SUP 3: $1848.8 - 76.4% retracement of the Jan 28 - Mar 8 rally
  • SUP 4: $1821.1 - Low Feb 11

Gold is unchanged and remains range bound, trading above $1890.2, the Mar 29 low. The outlook is bearish following the recent pullback from $2070.4, Mar 8 high. This has allowed a recent overbought condition to unwind. Key support at the 50-day EMA - today at $1908.9 - and the Mar 15 low of $1895.3 have recently been probed. A clear break lower would signal scope for a deeper pullback. Initial resistance is $1966.1.

SILVER TECHS: Bearish Cycle Still In Play

  • RES 4: $27.831 - High Jun 16 2021
  • RES 3: $27.245 - High Jun 17 2021
  • RES 2: $26.063/943 - High Mar 10 / High Mar 8 and the bull trigger
  • RES 1: $25.847 - High Mar 24
  • PRICE: $24.321 @ 07:18 BST Apr 7
  • SUP 1: $23.974 - Low Mar 29 and the bear trigger
  • SUP 2: $23.850 - Low Feb 24
  • SUP 3: $23.173 76.4% retracement of the Feb 3 - Mar 8 rally
  • SUP 4: $23.082 - Low Feb 15

Silver resistance is at $25.847, the Mar 24 high. A short-term bearish theme remains intact and potential is seen for a deeper retracement. Price is once again below the 50-day EMA at $24.518. This EMA marks an important support and a clear break would signal scope for a deeper pullback. For bulls, a move above $26.00 would alter the picture and refocus attention on $26.943, the Mar 8 high.

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