MNI DAILY TECHNICAL ANALYSIS - Bund Futures Extend Mini-Downtrend

Price Signal Summary - Bund Futures Extend Mini-Downtrend

• Further slippage Wednesday put the S&P E-Minis to fresh February lows, with weakness extending through the close. This puts prices below first support at the 50-day EMA at 4031.50 and tilts the near-term view lower. Dip buyers emerged in EUROSTOXX 50 futures again Wednesday, with prices rapidly bouncing off the 4211.00 lows. Nonetheless, prices remain just below first resistance at 4303.20, the 2.382 proj of the Sep 29 - Oct 4 rise from Dec 20 low, but still above 4265.00, the Feb 3 high.
• GBPUSD traded stronger into the Tuesday close, before fading for much of Wednesday trade. Price failed to retain upside momentum after the 1.2269 print last week. Recent weakness reinforces a S/T bearish theme and signals scope for a continuation. USDJPY topped the key short-term level marking the 50-day EMA on Tuesday last week. The break above 132.77 opened gains through 134.77, the Jan 6 high, firming the short-term outlook. Vol band resistance is layered between 135.31 and 136.38 ahead of Fib retracements at 136.67. AUDUSD printed a lower low Wednesday, putting prices further through first support at 0.6856 and exposing 0.6781 in the process. The broader uptrend remains intact for now, and the recent move lower highlights a correction that is allowing a recent overbought trend condition to unwind.
• Trend conditions in Gold are bearish for now, despite the late recovery into last Friday’s close. This follows the strong sell-off on Feb 2 / 3 as well as the break of support at the 50-day EMA early Wednesday. WTI futures drifted lower into the Wednesday close, returning the outlook to neutral for now. Prices now sit back below the 50-day EMA, at $78.34, however the medium-term view remains unchanged.
• Bund futures printed a fresh low Wednesday, extending the mini downtrend posted since the beginning of February. 133.63 marks the new pullback low, with weakness initially gathering pace on the break below 135.08, the Jan 4 low, and opens 132.60 in the short-term. Gilt futures printed another pullback low early Tuesday, marking an extension of the bearish break for the contract. This confirms a reversal of the late January bullish theme, and opens next support at 101.22 initially, vol band support.

FOREIGN EXCHANGE

EURUSD TECHS: Trend is Modestly Lower

• RES 4: 1.1076 High Apr 1, 2022
• RES 3: 1.1054 1.236 proj of the Oct 13 -27 rally from the Jan 6 low
• RES 2: 1.0940/1.1033 High Feb 3 / High Feb 2
• RES 1: 1.0793 20-day EMA
• PRICE: 1.0615 @ 07:37 GMT Feb 23
• SUP 1: 1.0599 Low Feb 17
• SUP 2: 1.0568 1.0% 10-dma envelope
• SUP 3: 1.0484 Low Jan 6 and a key support
• SUP 4: 1.0461 38.2% retracement of the Sep 28 - Feb 2 bull leg

The short-term trend remains tilted lower for EUR/USD despite recent evidence of dip-buying on pullbacks. Prices remain below the 50-day EMA at 1.0677, signalling that the current correction could have room to run lower. The clear break of the 50-day EMA strengthens the bearish cycle and exposes 1.0484, the Jan 6 low.

GBPUSD TECHS: Dips Through the Wednesday Close

• RES 4: 1.2506 1.382 proj of the Sep 26 - Oct 5 - Oct 12 price swing
• RES 3: 1.2401/2448 High Feb 2 / High Jan 23 and the bull trigger
• RES 2: 1.2265 High Feb 3
• RES 1: 1.2269 / 99 High Feb 14 / 20-day EMA
• PRICE: 1.2066 @ 07:40 GMT Feb 23
• SUP 1: 1.1915 Low Feb 17
• SUP 2: 1.1842 Low Jan 6 and a reversal trigger
• SUP 3: 1.1859 3.0% 10-dma envelope
• SUP 4: 1.1800 Round number support

GBPUSD traded stronger into the Tuesday close, before fading for much of Wednesday trade. Price failed to retain upside momentum after the 1.2269 print last week. Recent weakness reinforces a S/T bearish theme and signals scope for a continuation. A break of 1.1842 would highlight a potential trend reversal and a double top. Firm resistance is 1.2265, Feb 3 high. Key resistance is 1.2448, Jan 23 high.

EURGBP TECHS: Reverses Recent Recovery

• RES 4: 0.9097 76.4% Retracement of the Sep 26 - Dec 1 bear leg
• RES 3: 0.9047 2.0% 10-dma envelope
• RES 2: 0.8992 61.8% Retracement of the Sep 26 - Dec 1 bear leg
• RES 1: 0.8979 High Feb 3 and the bull trigger
• PRICE: 0.8797 @ 07:41 GMT Feb 23
• SUP 1: 0.8784 Low Feb 22
• SUP 2: 0.8770 1.0% 10-dma envelope
• SUP 3: 0.8762 Low Jan 30
• SUP 4: 0.8722 Low Jan 19 and a reversal trigger

EURGBP reversed lower into the Tuesday close, harming the recent bullish outlook. The intraday break below 0.8804 is bearish, and a close below here opens further weakness. 0.8770 vol band support could provide initial support ahead of 0.8762. Nonetheless, moving average studies remain in a bull-mode position, highlighting an underlying uptrend.

USDJPY TECHS: Strong to Stronger

• RES 4: 136.67 38.2% retracement of the Oct 21 - Jan 16 bear leg
• RES 3: 136.38 3.0% Upper Bollinger Band
• RES 2: 135.31 2.0% 10-dma envelope
• RES 1: 135.23 High Feb 21
• PRICE: 134.83 @ 07:43 GMT Feb 23
• SUP 1: 129.81 Low Feb 10
• SUP 2: 128.09/127.23 Low Feb 2 / Low Jan 16 and the bear trigger
• SUP 3: 126.81 1.382 proj of the Oct 31 - Nov 15 - 21 price swing
• SUP 4: 126.36 Low May 24 and a key support

USDJPY topped the key short-term level marking the 50-day EMA on Tuesday last week. The break above 132.77 opened gains through 134.77, the Jan 6 high, firming the short-term outlook. Vol band resistance is layered between 135.31 and 136.38 ahead of Fib retracements at 136.67. Firm support to watch is at 128.09, the Feb 2 low. The bear trigger is at 127.23, the Jan 16 low - a break would resume the downtrend.

EURJPY TECHS: Fades Off Resistance

• RES 4: 145.83 High Dec 20
• RES 3: 145.69 2.0% 10-dma envelope
• RES 2: 144.53 76.4% retracement of the Dec 15 - Jan 3 bear leg
• RES 1: 144.16 High Feb 21
• PRICE: 143.12 @ 07:45 GMT Feb 23
• SUP 1: 139.56/06 Low Feb 10 and a key support / Low Jan 20
• SUP 2: 139.98 2.0% 10-dma envelope
• SUP 3: 137.92 Low Jan 19
• SUP 4: 137.39 Low Jan 3 and the bear trigger

EURJPY traded stronger still Tuesday, with prices topping handle resistance at 144.00 before the rally moderated into the Wednesday close. This further firms the outlook for the cross, and extends the winning streak posted last week. The recent break of 142.99 confirms a continuation of the recovery that started on Jan 3. The next upside level sits at 144.53, ahead of vol-band resistance at 2.0% 10-dma envelope. Firmer support is expected at 139.94, the Feb 3 low and the outlook remains bullish.

AUDUSD TECHS: Pullback Nears Support

• RES 4: 0.7245 2.00 proj of the Nov 21 - Dec 13 - Dec 20 price swing
• RES 3: 0.7202 High Jun 9
• RES 2: 0.7172 1.764 proj of the Nov 21 - Dec 13 - Dec 20 price swing
• RES 1: 0.7082/0.7158 High Feb 3 / 2 and the bull trigger
• PRICE: 0.6819 @ 16:23 GMT Feb 22
• SUP 1: 0.6795 Low Feb 23
• SUP 2: 0.6781 38.2% retracement of the Oct 13 - Feb 2 uptrend
• SUP 3: 0.6755 Trendline support drawn from the Oct 13 low
• SUP 4: 0.6688 Low Jan 3

AUDUSD printed a lower low Wednesday, putting prices further through first support at 0.6856 and exposing 0.6781 in the process. The broader uptrend remains intact for now, and the recent move lower highlights a correction that is allowing a recent overbought trend condition to unwind. Key resistance and the bull trigger have been defined at 0.7158, the Feb 2 high. A break would resume the uptrend.

USDCAD TECHS: Building Base for Recovery

• RES 4: 1.3751 High Nov 4
• RES 3: 1.3705 Dec 16 and the bull trigger
• RES 2: 1.3665 High Jan 6
• RES 1: 1.3568 High Feb 23
• PRICE: 1.3525 @ 07:52 GMT Feb 23
• SUP 1: 1.3275/3262 Low Feb 14 / 2
• SUP 2: 1.3226 Low Nov 15 and bear trigger
• SUP 3: 1.3205 61.8% retracement of the Aug 11 - Oct 13 rally
• SUP 4: 1.3131 0.764 proj of the Oct 13 - Nov 15 - Dec 16 price swing

USDCAD tilted higher Wednesday, topping the recent high of 1.3537. This defies the view that the recent bounce was corrective, as the pair builds a base for further gains. The bull trigger is still someway off at 1.3705, but a weekly close above the 1.3500 would prove constructive. A break of 1.3262, Feb 2 low, would strengthen bearish conditions and open 1.3226, the Nov 15 low and the bear trigger.

FIXED INCOME

BUND TECHS: (H3) Keeps Pullback Lows Under Pressure

• RES 4: 142.59 0.764 proj of the Jan 2 - 19 - 30 price swing
• RES 3: 141.70 High Dec 13
• RES 2: 140.73 High Jan 19 and the bull trigger
• RES 1: 137.71/139.86 50-day EMA / High Feb 2
• PRICE: 134.33 @ 08:33 GMT Feb 22
• SUP 1: 133.63 Low Feb 22
• SUP 2: 133.51 Lower 2.0% Bollinger Band
• SUP 3: 133.03 2.0% 10-dma envelope
• SUP 4: 132.60 Low Jan 2

Bund futures printed a fresh low Wednesday, extending the mini downtrend posted since the beginning of February. 133.63 marks the new pullback low, with weakness initially gathering pace on the break below 135.08, the Jan 4 low, and opens 132.60 in the short-term. Moving average studies are in a bear-mode position, reinforcing current conditions. On the upside, resistance to watch is at 137.71, the 50-day EMA.

BOBL TECHS: (H3) Meets YTD Lows

• RES 4: 119.086 76.4% retracement of the Dec 7 - Jan 2 downleg
• RES 3: 118.880 High Jan 19 and the bull trigger
• RES 2: 117.324/118.670 50-day EMA / High Feb 2
• RES 1: 117.460 High Feb 9
• PRICE: 115.980 @ 15:49 GMT Feb 22
• SUP 1: 115.640 Low Feb 22 & Jan 2
• SUP 2: 115.480 2.0% Lower Bollinger Band
• SUP 3: 115.284 1.0% 10-dma envelope
• SUP 4: 115.000 Handle support

Bobl futures extended recent weakness to hit a pullback low of 115.640 on Tuesday. Key short-term support at 117.020, the Jan 30 low, has opened further losses for the contract, as well as support at 116.405, a Fibonacci retracement, giving way. Vol-bands at 115.480 is next up, with prices having equalled the early January lows. On the upside, the resistance to watch is at 117.324, the 50-day EMA. A break above this average would ease bearish pressure.

SCHATZ TECHS: (H3) Key Support Gives Way For Contract Lows

• RES 4: 106.296 61.8% retracement of the Dec 2 - Jan 2 bear leg
• RES 3: 106.130/106.155 High Feb 2 / High Jan 18 and bull trigger
• RES 2: 105.978 50-day EMA
• RES 1: 105.850 High Feb 7
• PRICE: 105.235 @ 15:55 GMT Feb 22
• SUP 1: 105.180 Low Feb 22
• SUP 2: 105.140 Low Oct 21 2008
• SUP 3: 105.051 Lower 3.0% Bollinger Band
• SUP 4: 104.656 1.0% 10-dma Envelope

Schatz futures started the week softer and retained the downside bias into the Wednesday open. Prices printed down at 105.180, a new contract low, before staging a shallow recovery into the close. Recent price action reinforces the current bearish theme and signals scope for weakness towards 105.140 - levels last seen in October 2008. On the upside, key resistance has been defined at 106.130, the Feb 2 high and 106.155, the Jan 18 high. Clearance of this resistance zone would reinstate a bullish condition.

GILT TECHS: (H3) Bearish Break Persists

• RES 4: 108.96 2.236 proj of the Jan 23 - 25 - 30 price swing
• RES 3: 108.44 2.00 proj of the Jan 23 - 25 - 30 price swing
• RES 2: 107.78 High Feb 2 and the bull trigger
• RES 1: 105.67/106.88 High Feb 9 / 6
• PRICE: 101.80 @ 15:58 GMT Feb 22
• SUP 1: 101.22 2.0% Lower Bollinger Band
• SUP 2: 101.01 2.0% 10-dma envelope
• SUP 3: 100.94 Low Feb 22
• SUP 4: 99.18 Low Dec 28

Gilt futures printed another pullback low early Tuesday, marking an extension of the bearish break for the contract. This confirms a reversal of the late January bullish theme, and opens next support at 101.22 initially, vol band support. Initial resistance remains at 105.67, the Feb 9 high, but markets have opened a decent gap with that next upside level.

BTP TECHS: (H3) Sell Off Accelerates

• RES 4: 121.26 0.764 proj of the Dec 30 - Jan 19 - 30 price swing
• RES 3: 120.00 Psychological round number
• RES 2: 118.56/96 High Jan 19 / Dec 7 and a key resistance zone
• RES 1: 116.33/118.18 High Feb 9 / High Feb 2
• PRICE: 112.79 @ 16:01 GMT Feb 22
• SUP 1: 112.08 Low Feb 22
• SUP 2: 111.90 2.0% 10-dma envelope
• SUP 3: 111.59 Low Jan 6
• SUP 4: 110.77 Low Jan 4 and 76.4% of the Dec 30 - Jan 19 rally

BTP futures slipped further still early Wednesday, printing a fresh pullback low at 112.08. This keeps the outlook bearish, and defies views that the recent weakness was corrective in nature. The next downside levels to watch cross at 111.90, the 2.0% 10-dma envelope. A break would be a bearish development. A reversal higher would signal scope for a test of firm resistance at 118.56, the Jan 19 high and 118.96, the Dec 7 high.

EQUITIES

EUROSTOXX50 TECHS: (H3) Dip Buyers Dominate

• RES 4: 4409.50 High Nov 18 2021
• RES 3: 4335.50 High Jan 6 2022 (cont)
• RES 2: 4324.50 High Jan 13 2022 (cont)
• RES 1: 4315.00 High Feb 16
• PRICE: 4259.00 @ 08:05 GMT Feb 23
• SUP 1: 4228.60/4097.00 20-day EMA / Low Jan 19 and a key support
• SUP 2: 4062.40 Bull channel base drawn from the Oct 13 low
• SUP 3: 3890.00 Low Jan 4
• SUP 4: 3753.00 Low Dec 20 and the bear trigger

Dip buyers emerged in EUROSTOXX 50 futures again Wednesday, with prices rapidly bouncing off the 4211.00 lows. Nonetheless, prices remain just below first resistance at 4303.20, the 2.382 proj of the Sep 29 - Oct 4 rise from Dec 20 low, but still above 4265.00, the Feb 3 high. Note that the trend is overbought. A pullback would represent a healthy correction. Key support lies at 4097.00, the Jan 19 low. Initial support is at 4228.4, the 20-day EMA.

E-MINI S&P (H3): Hits February Pullback Low

• RES 4: 4361.00 High Aug 16
• RES 3: 4300.00 Round number resistance
• RES 2: 4250.00 High Aug 26, 2022
• RES 1: 4208.50 High Feb 2 and the bull trigger
• PRICE: 4005.25 @ 08:09 GMT Feb 23
• SUP 1: 3983.75 Low Feb 23
• SUP 2: 3962.47 3.0% 10-dma envelope
• SUP 3: 3901.75 Low Jan 19
• SUP 4: 3788.50 Low Dec 22 and a key support

Further slippage Wednesday put the S&P E-Minis to fresh February lows, with weakness extending through the close. This puts prices below first support at the 50-day EMA at 4031.50 and tilts the near-term view lower. 3901.75 marks next support, the Jan 19 low.

COMMODITIES

BRENT TECHS: (J3) More Neutral Short-term View

• RES 4: $92.64 - High Nov 14
• RES 3: $90.34 - 76.4% retracement of the Nov 7 - Dec 12 bear leg
• RES 2: $89.00 - High Jan 23 and the bull trigger
• RES 1: $86.95 - High Feb 14
• PRICE: $80.86 @ 07:10 GMT Feb 23
• SUP 1: $80.40/79.10 - Low Feb 23 / 6
• SUP 2: $77.77 - Low Jan 5
• SUP 3: $75.89 - Low Dec 12 and the bear trigger
• SUP 4: $73.48 - 1.00 proj of the Nov 7 - Dec 12 - Jan 23 price swing

Brent futures traded heavy into the Thursday close, with the downside accelerating on the break of $84.00 handle support earlier in the week. For now, the outlook remains neutral. On the downside, a move below $79.10, Feb 6 low, is required to reinstate a bearish theme. For bulls to recoup any sway over markets, prices need to top the Feb 13 highs at 86.95.

WTI TECHS: (J3) Recovery Fades, But Medium-Term View Unchanged

• RES 4: $87.00 - High Nov 14
• RES 3: $85.33 - 76.4% retracement of the Nov 7 - Dec 9 bear leg
• RES 2: $83.14 - High Dec 1 and a key resistance
• RES 1: $80.62 - High Feb 13
• PRICE: $74.04 @ 07:15 GMT Feb 23
• SUP 1: $73.80 - Low Feb 23
• SUP 2: $72.25 - Low Feb 6
• SUP 3: $70.56 - Low Dec 9 and the bear trigger
• SUP 4: $70.00 - Psychological round number

WTI futures drifted lower into the Wednesday close, returning the outlook to neutral for now. Prices now sit back below the 50-day EMA, at $78.34, however the medium-term view remains unchanged. Key resistance remains at $82.66, the Jan 18 high. On the downside, initial firm support has been defined at $72.25, the Feb 6 low for the continuation contract.

GOLD TECHS: Envelope Support Contains Break Lower

• RES 4: $1998.4 - High Apr 18, 2022
• RES 3: $1982.0 - High Apr 19, 2022
• RES 2: $1963.0 - 76.4% retracement of the Mar - Sep 2022 bear leg
• RES 1: $1892.1/1959.7 - 20-day EMA / High Feb 2
• PRICE: $1830.9 @ 07:18 GMT Feb 23
• SUP 1: $1819.0 - Low Feb 17
• SUP 2: $1805.3 - 2.0% 10-dma envelope
• SUP 3: $1797.1 - Low Dec 28
• SUP 4: $1787.3 - 50.0% retracement of the Sep 28 - Feb 2 bull leg

Trend conditions in Gold are bearish for now, despite the late recovery into last Friday’s close. This follows the strong sell-off on Feb 2 / 3 as well as the break of support at the 50-day EMA early Wednesday. A clear break here would strengthen a bearish case and suggest scope for a deeper pullback. Vol band support (the 2.0% 10-dma envelope), successfully contained prices Friday, keeping the focus on the level this week.

SILVER TECHS: Bearish Price Action

• RES 4: $25.293 - High Apr 20
• RES 3: $24.729 - 76.4% retracement of the Mar - Sep bear leg
• RES 2: $24.637 - High Feb 2 and the bull trigger
• RES 1: $22.331 - 20-day EMA
• PRICE: $21.583 @ 07:22 GMT Feb 23
• SUP 1: $21.179 - Low Feb 17
• SUP 2: $21.099 - 50.0% retracement of the Sep 1 - Feb 2 bull leg
• SUP 3: $20.872 - Low Nov 28
• SUP 4: $20.585 - Low Nov 21

A sharp sell-off in Silver at the beginning of February resulted in a break of $22.557, the Dec 16 low. Price has also traded below the 50-day EMA - a bearish development. The move lower highlights a range breakout and if this is correct, it warns of a short-term trend reversal. The continuation lower opens $21.099, a Fibonacci retracement. On the upside, initial resistance is seen at $22.232, the 20-day EMA ahead of $24.637, the Feb 2 high.