MNI DAILY TECHNICAL ANALYSIS - Bullish Theme in European Equities Despite Latest Pullback

Price Signal Summary – Bullish Theme in European Equities Despite Latest Pullback

• The uptrend in S&P E-Minis remains intact and the contract is holding on to its latest gains. Recent gains have resulted in a break of a key resistance at 5333.50, Apr 1 high. This confirms a resumption of the primary uptrend and signals scope for a climb to 5372.73. A bullish theme in Eurostoxx 50 futures remains intact despite the latest pullback. Last week’s gains resulted in a break of key resistance at 5079.00, the Apr 2 high, to confirm a resumption of the uptrend and maintain the price sequence of higher highs and higher lows.
• EURUSD is trading closer to last week’s highs and the recent consolidation appears to be a bull flag. The outlook remains bullish following recent gains. The move higher last week resulted in a clear bear channel breakout - price cleared the top of a channel drawn from the Dec 28 high. EURGBP traded lower last week and the cross has started this week on a bearish note as it continues to weaken. Price has moved below the 20- and 50-day EMAs. This cancels a bullish theme and instead highlights a neutral medium-term trend. A bullish condition in AUDUSD remains intact following last week’s gains. The move higher resulted in the break of a number of short-term resistance points and the May 15 rally resulted in a breach of a key short-term resistance at 0.6668.
• The medium-term trend structure in Gold is unchanged and remains bullish. Yesterday’s initial gains resulted in a print above resistance at $2431.5, the Apr 12 high and bull trigger. Despite the latest move higher, a bearish theme in WTI futures remains intact and short-term gains are considered corrective. Price has recently traded below the 50-day EMA, strengthening a bearish set-up that highlights potential for a deeper correction.
• Bund futures remain below last week’s high. The rally May 15 resulted in a print above the 50-day EMA and was followed by a breach of a key resistance at 131.86, the May 7 high. This continues to highlight a potential reversal. Gilt futures traded higher last week but the contract has pulled back from its recent highs. A break of 98.76, the May 16 high, would confirm a resumption of the current bull cycle and this would signal scope for a climb towards 99.19, a Fibonacci retracement.

EURUSD TECHS: Bull Flag

• RES 4: 1.0981 High Mar 8 and a key resistance
• RES 3: 1.0964 High Mar 13
• RES 2: 1.0933 61.8% retracement of the Dec 28 - Apr 16 bear leg
• RES 1: 1.0895 High May 16
• PRICE: 1.0859 @ 05:50 BST May 21
• SUP 1: 1.0820 Former channel top drawn from the Dec 28 high
• SUP 2: 1.0784 50-day EMA and a key near-term support
• SUP 3: 1.0724 Low May 3
• SUP 4: 1.0650 Low May 1

EURUSD is trading closer to last week’s highs and the recent consolidation appears to be a bull flag. The outlook remains bullish following recent gains. The move higher last week resulted in a clear bear channel breakout - price cleared the top of a channel drawn from the Dec 28 high and the break confirms a stronger reversal. Sights are on 1.0933 next, a Fibonacci retracement. Initial firm support lies at 1.0784, the 50-day EMA.

GBPUSD TECHS: Bullish Outlook

• RES 4: 1.2823 High Mar 14
• RES 3: 1.2803 High Mar 21
• RES 2: 1.2754 76.4% retracement of the Mar 8 - Apr 22 bear leg
• RES 1: 1.2725 High May 20
• PRICE: 1.2711 @ 06:08 BST May 21
• SUP 1: 1.2643/1.2584 Low May 16 / 50-day EMA
• SUP 2: 1.2510 Low May 14
• SUP 3: 1.2446 Low May 9 and a key near-term support
• SUP 4: 1.2423 Low Apr 24

GBPUSD maintains a bullish tone and is holding on to its latest gains. The breach last week of 1.2634, the May 3 high, confirms a resumption of the current bull cycle and sights are on 1.2754, a Fibonacci retracement. A break of this level would open 1.2803, the Mar 21 high. On the downside, initial firm support lies at 1.2584, the 50-day EMA. Key support is 1.2446, the May 9 low. A break of this level is required to reinstate a bearish threat.

EURGBP TECHS: Approaching First Support

• RES 4: 0.8665 61.8% retracement of the Nov 20 - Feb 14 bear cycle
• RES 3: 0.8674 1.0% 10-dma envelope
• RES 2: 0.8645 High Apr 23 and the bull trigger
• RES 1: 0.8575/8621 20-day EMA / High May 9
• PRICE: 0.8544 @ 06:20 BST May 21
• SUP 1: 0.8531 Low Apr 30 and a short-term bear trigger
• SUP 2: 0.8521/8504 Low Apr 17 / Low Mar 8
• SUP 3: 0.8498/93 Low Feb 14 / Low Aug 23 2023 and key support
• SUP 4: 0.8454 76.4% of the Mar 7 - Sep 26 ‘23 bull phase

EURGBP traded lower last week and the cross has started this week on a bearish note as it continues to weaken. Price has moved below the 20- and 50-day EMAs. This cancels a bullish theme and instead highlights a neutral medium-term trend with the cross trading inside a wide range. The break of Friday’s low signals scope for weakness near-term and exposes 0.8531, the Apr 30 low. Initial resistance is seen at 0.8575, the 20-day EMA.

USDJPY TECHS: Resistance Remains Intact For Now

• RES 4: 160.17 High Apr 29 and the bull trigger
• RES 3: 157.99 High May 1
• RES 2: 157.00 61.8% retracement of the Apr 29 - May 3 sell-off
• RES 1: 156.74 High May 14
• PRICE: 156.38 @ 06:39 BST May 21
• SUP 1: 153.56 50-day EMA
• SUP 2: 152.61 Trendline support drawn from the Dec 28 low
• SUP 3: 151.86 Low May 3
• SUP 4: 150.81 Low Apr 5

USDJPY traded higher Monday and remains above last Thursday’s low. For bears, the pullback from 156.74, May 14 high, continues to signal the end of the corrective phase between May 3 - 14, and a possible resumption of a S/T bearish cycle. Attention is on 153.56, the 50-day EMA, and 152.61, trendline support drawn from the Dec 28 low. Clearance of these two price points would strengthen a bearish threat. 156.74 is the resistance to watch.

EURJPY TECHS: Bull Cycle Extends

• RES 4: 171.67 2.0% 10-dma envelope
• RES 3: 171.56 High Apr 29 and the bull trigger
• RES 2: 170.65 0.618 proj of the May 3 - 15 - 16 price swing
• RES 1: 169.94 Intraday high
• PRICE: 169.80 @ 06:55 BST May 21
• SUP 1: 167.43 20-day EMA
• SUP 2: 165.96 Trendline support drawn from the Dec 7 ‘23 low
• SUP 3: 165.58 50-day EMA
• SUP 4: 164.02 Low May 3

EURJPY has recovered from last Thursday’s low and is trading higher this week. The medium-term trend structure is bullish and sights are on 171.56, the Apr 29 high and key resistance. Initial support at the 20-day EMA, at 167.43, remains intact. Key trendline support drawn from the Dec 7 ‘23 low, lies at 165.96. A clear break of this line would highlight a stronger reversal and initially expose support at the 50-day EMA, at 165.58.

AUDUSD TECHS: Trend Needle Points North

• RES 4: 0.6771 High Jan 3
• RES 3: 0.6751 76.4% retracement of the Dec 28 - Apr 19 bear leg
• RES 2: 0.6729 High Jan 12
• RES 1: 0.6714 High May 16
• PRICE: 0.6654 @ 07:52 BST May 21
• SUP 1: 0.6604 20-day EMA
• SUP 2: 0.6569 50-day EMA
• SUP 3: 0.6465/6407 Low May 1 / Low Apr 22
• SUP 4: 0.6363 Low Apr 19 and the bear trigger

A bullish condition in AUDUSD remains intact following last week’s gains. The move higher resulted in the break of a number of short-term resistance points and the May 15 rally resulted in a breach of a key short-term resistance at 0.6668, the Mar 8 high. The break strengthens a bullish theme and opens 0.6751, a Fibonacci retracement. On the downside, support to watch lies at 0.6569, the 50-day EMA.

USDCAD TECHS: Testing Support

• RES 4: 1.3977 High Oct 13 ‘23 and a key M/T resistance
• RES 3: 1.3899 High Nov 1 and a key resistance
• RES 2: 1.3846/55 High Apr 16 and the bull trigger / High Nov 10 2023
• RES 1: 1.3660/3785 20-day EMA / High Apr 30
• PRICE: 1.3635 @ 07:58 BST May 21
• SUP 1: 1.3590 Low May 16
• SUP 2: 1.3547 Low Apr 9
• SUP 3: 1.3512 50.0% retracement of the Dec 27 - Apr 16 bull cycle
• SUP 4: 1.3478 Low Apr 4

USDCAD is in consolidation mode and is trading just above last week’s low. A bullish trend condition remains intact, despite the latest pullback. However, key supports at 1.3635, the 50-day EMA, and 1.3610, the May 3 low, have been pierced. A clear break of both levels would threaten the bullish theme and instead signal scope for a deeper retracement. For bulls, a resumption of gains would refocus attention on the bull trigger at 1.3846, the Apr 16 high.

FIXED INCOME

BUND TECHS: (M4) Watching Support

• RES 4: 133.05 High Apr 12
• RES 3: 132.89 38.2% retracement of the Dec 27 - Apr 25 bear cycle
• RES 2: 132.55 High Apr 15
• RES 1: 131.61/132.11 50-day EMA / High Apr 16 and the bull trigger
• PRICE: 130.63 @ 05:27 BST May 21
• SUP 1: 130.47 Low May 20
• SUP 2: 130.24 Low May 14 and a key short-term support
• SUP 3: 129.83 Low Apr 30
• SUP 4: 129.53 Low Apr 25 and a bear trigger

Bund futures remain below last week’s high. The rally May 15 resulted in a print above the 50-day EMA and was followed by a breach of a key resistance at 131.86, the May 7 high. This continues to highlight a potential reversal, however a break of 132.11, the May 16 high, is required to reinforce a bullish condition. For bears, a breach of support at 130..24, May 14 low, would instead expose key support at 129.53, the Apr 25 low.

BOBL TECHS: (M4) Support Remains Intact For Now

• RES 4: 117.880 High Apr 15
• RES 2: 117.620 High Apr 19
• RES 3: 117.346/440 High 50-day EMA / May 16
• RES 1: 116.943 20-day EMA
• PRICE: 116.630 @ 05:45 BST May 21
• SUP 1: 116.510 Low May 14 and a key near-term support
• SUP 2: 116.430 Low MAy 2
• SUP 3: 116.230 Low Apr 30 and a bear trigger
• SUP 4: 116.135 1.50 proj of the Mar 8 - 18 - 27 price swing

Bobl futures traded sharply higher on May 15 and the move highlighted a potential short-term reversal. However, clearance of resistance at 117.440, the May 16 high, is required to strengthen a bullish theme and note this would also highlight a break of the 50-day EMA, at 117.346. The pullback from last week’s peak exposes support at 116.510, May 14 low. Clearance of this level would instead be bearish and expose key support at 116.230, Apr 30 low.

SCHATZ TECHS: (M4) Key Support Remains Exposed

• RES 4: 105.790 High Mar 25 and key resistance
• RES 3: 105.680 High Apr 12
• RES 2: 105.469 50-day EMA
• RES 1: 105.276/105.395 20-day EMA / High May 3
• PRICE: 105.145 @ 05:41 BST May 21
• SUP 1: 105.045 Low Apr 30 and the bear trigger
• SUP 2: 105.000 Round number support
• SUP 3: 104.917 1.764 proj of the Aug 8 - Mar 18 - Mar 25 price swing
• SUP 4: 104.800 2.00 proj of the Mar 8 - 18 - 25 price swing

The trend direction in Schatz futures remains down. The contract has pulled back from last week’s high and - for now - resistance at 105.395, the May 3 high, remains intact. The contract has traded through support at 105.150, the May 14 low. This exposes key support and the bear trigger at 105.045, the Apr 30 low, where a break would confirm a resumption of the primary downtrend. A move above 105.395 is required to alter the picture.

GILT TECHS: (M4) Bull Cycle Remains In Play For Now With Support Intact

• RES 4: 99.37 High Apr 4
• RES 3: 99.19 76.4% of the Mar 12 - Apr 25 bear leg
• RES 2: 99.10 High Apr 10
• RES 1: 98.76 High May 16
• PRICE: 97.58 @ Close May 20
• SUP 1: 97.23 Low May 14 and a key near-term support
• SUP 2: 96.43/95.36 Low May 3 / Low Apr 25 and the bear trigger
• SUP 3: 95.00 Round number support
• SUP 4: 94.86 2.236 proj of the Mar 12 - 15 - 22 price swing

Gilt futures traded higher last week but the contract has pulled back from its recent highs. A break of 98.76, the May 16 high, would confirm a resumption of the current bull cycle and this would signal scope for a climb towards 99.19, a Fibonacci retracement. Initial firm support has been defined at 97.23, the May 14 low. Clearance of this level would instead be viewed as a bearish development.

BTP TECHS: (M4) Resistance Remains Intact For Now

• RES 4: 120.28 High Mar 14 and the bull rally
• RES 3: 119.55 High Mar 27
• RES 2: 119.10 High Apr 10 and a key near-term resistance
• RES 1: 119.00 High May 16
• PRICE: 118.03 @ Close May 17
• SUP 1: 116.94/115.76 Low May 14 / Low Apr 25 and the bear trigger
• SUP 2: 115.70 Low Dec 8 ‘23 (cont)
• SUP 3: 114.74 1.236 proj of the Dec 27 - Feb 22 - Mar 14 price swing
• SUP 4: 114.09 1.382 proj of the Dec 27 - Feb 22 - Mar 14 price swing

BTP futures rallied last Wednesday and in the process traded above resistance at 118.61, the May 6 high. This exposes a more important resistance at 119.10, Apr 10 high. Clearance of this level would strengthen a bullish theme and signal scope for a climb towards key resistance at 120.28, the Mar 14 high. On the downside, a break of initial support at 116.94, the May 15 low, would instead be a bearish development.

EQUITIES

EUROSTOXX50 TECHS: (M4) Trend Needle Continues To Point North

• RES 4: 5170.50 1.50 proj of the Jan 17 - Feb 12 - 13 price swing
• RES 3: 5162.00 High Nov 2000
• RES 2: 5127.70 1.382 proj of the Jan 17 - Feb 12 - 13 price swing
• RES 1: 5110.00 High May 16
• PRICE: 5063.00 @ 06:09 BST May 21
• SUP 1: 5013.20/4940.50 20- and 50- day EMA values
• SUP 2: 4862.00 Low Apr 25
• SUP 3: 4762.00 Low Apr 19 and the bear trigger
• SUP 4: 4711.00 Low Feb 19

A bullish theme in Eurostoxx 50 futures remains intact despite the latest pullback. Last week’s gains resulted in a break of key resistance at 5079.00, the Apr 2 high, to confirm a resumption of the uptrend and maintain the price sequence of higher highs and higher lows. This opens 5127.70 next, a Fibonacci projection. Key trend support is 4762.00, Apr 19 low. The initial support zone to watch is 5013.20/4940.50, the 20- and 50- day EMA values.

E-MINI S&P TECHS: (M4) Holding On To Its Gains

• RES 4: 5417.75 2.00 proj of the Apr 19 - 29 - May 2 price swing
• RES 3: 5400.00 Round number resistance
• RES 2: 5372.73 1.764 proj of the Apr 19 - 29 - May 2 price swing
• RES 1: 5349.00 High May 16
• PRICE: 5333.75 @ 06:50 BST May 21
• SUP 1: 5229.67 20-day EMA
• SUP 2: 5179.44 50-day EMA
• SUP 3: 5036.25 Low May 2
• SUP 4: 4963.50 Low Apr 19 and bear trigger

The uptrend in S&P E-Minis remains intact and the contract is holding on to its latest gains. Recent gains have resulted in a break of a key resistance at 5333.50, Apr 1 high. This confirms a resumption of the primary uptrend and signals scope for a climb to 5372.73, a Fibonacci projection. Moving average studies remain in a bull-mode set-up, highlighting a clear uptrend. Initial support is at 5229.67, the 20-day EMA. COMMODITIES

BRENT TECHS: (N4) Bear Threat Remains Present

• RES 4: $94.00 - 2.236 proj of the Jan 3 - 29 - Feb 5 price swing
• RES 3: $92.09 - 2.00 proj of the Jan 8 - 29 - Feb 5 price swing
• RES 2: $91.18 - High Apr 12 and the bull trigger
• RES 1: $84.48/88.64 - 50-day EMA / High Apr 26
• PRICE: $83.21 @ 07:02 BST May 21
• SUP 1: $81.05 - Low May 15
• SUP 2: $80.24 - 61.8% retracement of the Dec 13 - Apr 12 bull cycle
• SUP 3: $75.91 - Low Feb 5
• SUP 4: $73.47 - Low Dec 13 and a key support

Brent futures remain inside the recent range. In terms of the trend, conditions are bearish. Price has recently cleared the 50-day EMA and the clear breach of this average signals scope for a deeper correction towards $80.24, a Fibonacci retracement. Key resistance and the bull trigger has been defined at $91.18, the Apr 12 high. Clearance of this level would resume the uptrend. Initial firm resistance is $88.64, Apr 26 high.

WTI TECHS: (N4) Recent Short-Term Gains Appear To Be A Correction

• RES 4: $90.00 - Psychological round number
• RES 3: $86.93 - 2.00 proj of the Jan 8 - 29 - Feb 5 price swing
• RES 2: $83.63/86.16 - High Apr 26 / 12 and the bull trigger
• RES 1: $80.90 - High May 1
• PRICE: $78.78 @ 07:14 BST May 21
• SUP 1: $76.36 - Low May 15
• SUP 2: $75.64 - Low Mar 11
• SUP 3: $73.24 - 76.4% retracement of the Dec 13 - Apr 12 bull leg
• SUP 4: $71.33 - Low Feb 5

Despite the latest move higher, a bearish theme in WTI futures remains intact and short-term gains are considered corrective. Price has recently traded below the 50-day EMA, strengthening a bearish set-up that highlights potential for a deeper correction. Scope is seen for a move to $76.07, the Mar 11 low. Key resistance and the bull trigger is at $86.97, the Apr 12 high. Initial firm resistance to watch is at $84.46, the Apr 26 high.

GOLD TECHS: Trend Structure Remains Bullish

• RES 4: $2528.4 - 3.00 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 3: $2500.0 - Round number resistance
• RES 2: $2481.5 - 2.764 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 1: $2452.5 - 2.618 proj of the Oct 6 - 27 - Nov 13 price swing
• PRICE: $2416.1 @ 07:18 BST May 21
• SUP 1: $2351.4/2288.7 - 20- and 50- day EMA values
• SUP 2: $2277.4 - Low May 3 and a pivot support
• SUP 3: $2187.4 - Low Mar 28
• SUP 4: $2146.2 - Low Mar 18 and key short-term support

The medium-term trend structure in Gold is unchanged and remains bullish. Yesterday’s initial gains resulted in a print above resistance at $2431.5, the Apr 12 high and bull trigger. The break confirms a resumption of the primary uptrend and paves the way for a climb towards 2452.5 next, a Fibonacci projection. On the downside, the 50-day EMA, at $2288.7, represents a key support. A clear break of it would be bearish.

SILVER TECHS: Impulsive Bull Cycle Remains Intact

• RES 4: $35.745 - 1.236 proj of Jan 22 - Apr 12 - Nov 13 price swing
• RES 3: $35.226 - 50.0% of the Apr 2011 - Mar 2020 bear leg
• RES 2: $33.887 - 1.00 proj of the Jan 22 - Apr 12 - Nov 13 price swing
• RES 1: $32.518 - High May 20
• PRICE: $31.434 @ 08:03 BST May 21
• SUP 1: $29.797 - High Apr 12 and a recent breakout level
• SUP 2: $28.571 - 20-day EMA
• SUP 3: $27.139/018 - 50-day EMA / Low May 2
• SUP 4: $24.328 - Low Mar 27

Silver maintains a bullish theme and the metal traded higher Monday. Last week’s rally resulted in a clear break of resistance at $29.797, the Apr 12 high. The breach confirmed a resumption of the uptrend and sights are on $33.887 next, a Fibonacci projection. Short-term pullbacks would be considered correction. A key support zone lies between $28.571-27.139, the 20- and 50-day EMA values.