MNI DAILY TECHNICAL ANALYSIS - Bund Futures Remain Vulnerable

Price Signal Summary - Bund Futures Remain Vulnerable

• On the equity front, S&P E-minis are consolidating near recent highs. This week's climb to a fresh all-time high confirms a resumption of the uptrend and attention turns to the 4500.00 handle. EUROSTOXX 50 key support has been defined at 4078.00, Aug 19 low. The outlook is bullish while this level holds.
• In the FX space, the USD remains in an uptrend and this week's weakness is still considered corrective. EURUSD last week cleared 1.1704, Mar 31 low. This opens 1.1621 next, 1.00 projection of the Jan 6 - Mar 31 - May 25 price swing. Firm resistance to watch is 1.1805, Aug 13 high. GBPUSD remains vulnerable despite this week's bounce. The focus is on the bear trigger at 1.3572, Jul 20 low. Resistance is at 1.3768, Aug 26 high. The Aug 20 price pattern in USDCAD was a bearish shooting star candle and Monday's weak close reinforces the bearish pattern. An extension would expose 1.2522, the 50-day EMA.
• On the commodity front, Gold maintains a bullish tone following this week's breach of its 50-day EMA. The break signals scope for a climb towards $1834.1, Jul 15 high and a bull trigger. WTI futures support has been defined at $61.74, Aug 23 low. Note, Monday's price action was a bullish engulfing reversal candle, highlighting a positive short-term theme. Further gains would open $69.39. Aug 12 high.
• In FI, Bunds support at 176.21, Aug 11 low was cleared Wednesday, highlighting a short-term bearish theme. The focus is on 175.39, the 50-day EMA. Gilt futures appear vulnerable following recent weakness. An extension lower would open 128.03, Jul 6 low (cont).

FOREIGN EXCHANGE

EURUSD TECHS: Corrective Cycle Still In Play

• RES 4: 1.1909 High Jul 30
• RES 3: 1.1830 50-day EMA
• RES 2: 1.1805 High Aug 13 and key short-term resistance
• RES 1: 1.1784 High Aug 17
• PRICE: 1.1763 @ 05:53 BST Aug 27
• SUP 1: 1.1664 Low Aug 20 and the bear trigger
• SUP 2: 1.1621 1.00 proj of the Jan 6 - Mar 31 - May 25 price swing
• SUP 3: 1.1603 Low Nov 4, 2020
• SUP 4: 1.1495 High Mar 9, 2020

EURUSD is holding onto the bulk of recent gains and traded higher Thursday. The recent bounce is still considered corrective and trend conditions remain bearish. Recent weakness below 1.1704, Mar 31 low confirms a resumption of the downtrend and opens 1.1603 next, the Nov 4, 2020 low. Below here, the immediate post pandemic highs at 1.1495 would attract and also represents pivot support. Key short-term resistance is unchanged at 1.1805.

GBPUSD TECHS: Finds Resistance

• RES 4: 1.3983/90 High Jul 30 / 61.8% of the Jun 1 - Jul 20 sell-off
• RES 3: 1.3916 High Aug 9
• RES 2: 1.3834 50-day EMA
• RES 1: 1.3768 High Aug 26
• PRICE: 1.3700 @ 05:56 BST Aug 27
• SUP 1: 1.3602 Low Aug 20
• SUP 2: 1.3572 Low Jul 20 and the bear trigger
• SUP 3: 1.3520 Low Jan 18
• SUP 4: 1.3452 Low Jan 11

GBPUSD found resistance Thursday and has pulled away from 1.3768, the Aug 27 high. A bearish theme still dominates following last week's sell-off that reinforced a bearish condition. Price remains below the 50-day EMA and attention is on key support at 1.3572, Jul 20 low. For bulls, a convincing recovery back above the 50-day EMA at 1.3834 is required to ease the current bearish pressure. Initial resistance is at 1.3768.

EURGBP TECHS: Short-Term Theme Remains Bullish

• RES 4: 0.8670 High Jul 20 and key resistance
• RES 3: 0.8659 High Jul 21
• RES 2: 0.8618 76.4% retracement of the Jul 20 - Aug 10 sell-off
• RES 1: 0.8592/94 100-dma / High Aug 23
• PRICE: 0.8589 @ 06:07 BST Aug 27
• SUP 1: 0.8539 20-day EMA
• SUP 2: 0.8506 Low Jul 19
• SUP 3: 0.8484 Low Aug 16
• SUP 4: 0.8450 Low Aug 10 and a key support

EURGBP found support Thursday. Last week the cross traded through both the 20- and 50-day EMAs. This signals scope for further gains near-term. Attention is on the 100-dma next at 0.8591 that was briefly probed Monday. Gains are still considered corrective though and from a trend perspective, the outlook is bearish. A return lower and a break of initial firm support at 0.8506, Aug 19 low would signal a resumption of bearish pressure.

USDJPY TECHS: Range Bound

• RES 4: 111.66 High Jul 2 and the bull trigger
• RES 3: 110.82 High Jul 7
• RES 2: 110.80 High Aug 11 and a key resistance
• RES 1: 110.23/46 High Aug 19 and 26 / High Aug 13
• PRICE: 109.94 @ 06:11 BST Aug 27
• SUP 1: 109.41 Low Aug 24
• SUP 2: 109.11/108.72 Low Aug 16 / Low Aug 04 and the bear trigger
• SUP 3: 108.56 Low May 25
• SUP 4: 108.47 76.4% of the Apr 23 - Jul 2 rally

USDJPY still trades in a range. Despite recent gains, the pair appears vulnerable and attention is on the key support at 108.72, Aug 4 low. A breach of this level would strengthen a bearish case and expose the 108.47 Fibonacci retracement. For bulls, key near-term resistance is unchanged at 110.80, Aug 11 high. A break would ease bearish concerns and instead open key resistance at 111.66, Jul 2 high.

EURJPY TECHS: Watching The 50-Day EMA

• RES 4: 131.09 High Jul 13
• RES 3: 130.56 High Jul 29
• RES 2: 129.99 50-day EMA
• RES 1: 129.76 High Aug 26
• PRICE: 129.34 @ 07:15 BST Aug 27
• SUP 1: 128.60 Low Aug 24
• SUP 2: 127.94 Low Aug 19 and the bear trigger
• SUP 3: 127.88 38.2% retracement of the Oct '20 - Jun rally
• SUP 4: 127.31 Low Feb 17

EURJPY trend conditions remain bearish. From a short-term perspective though the cross continues to trade higher as the current correction extends. Further gains would open 129.99, the 50-day EMA. A clear break of the 50-day EMA is required to suggest scope for a stronger recovery. On the downside, key support has been defined at 127.94, Aug 19 low. A break would resume the downtrend.

AUDUSD TECHS: Initial Resistance Remains Intact

• RES 4: 0.7427 High Aug 4 and a key resistance
• RES 3: 0.7389 High Aug 11
• RES 2: 0.7341 High Aug 17
• RES 1: 0.7290 Low Jul 21 and a recent breakout level
• PRICE: 0.7243 @ 06:29 BST Aug 27
• SUP 1: 0.7201/7106 Low Aug 24 /Low Aug 20 and the bear trigger
• SUP 2: 0.7053 38.2% retracement of the Mar '20 - Feb uptrend
• SUP 3: 0.6991 Low Nov 2, 2020
• SUP 4: 0.6921 Low Jul 14, 2020

AUDUSD maintains this week's firm tone but did face resistance Thursday. Recent gains are still considered corrective. The breach of 0.7290 on Aug 17 confirmed an extension of the bearish price sequence of lower lows and lower highs, reinforcing the current downward cycle. Price has also cleared 0.7200 and this opens 0.7053 further out, a Fibonacci retracement. Initial firm resistance is seen at 0.7290, low Jul 21.

USDCAD TECHS: Off Recent Lows

• RES 4: 1.2976 1.00 proj of the Jun 23 - Jul 19 - 30 price swing
• RES 3: 1.2957 High Dec 21, 2020
• RES 2: 1.2834/ 2949 High Aug 23 / High Aug 20 and the bull trigger
• RES 1: 1.2720 38.2% of the Aug 20 - 24 sell-off
• PRICE: 1.2681 @ 06:32 BST Aug 27
• SUP 1: 1.2579 Low Aug 24
• SUP 2: 1.2522 50-day EMA
• SUP 3: 1.2422 Jul 30 low
• SUP 4: 1.2303 Low Jul 6

USDCAD traded sharply lower Monday and maintains a bearish short-term tone. However, the pair did find support Thursday and is off recent lows. From a pattern perspective, activity on Aug 20 was a bearish shooting star candle. Monday's sell-off and particularly the weak close, reinforced this pattern and highlights a short-term bearish theme. Attention is on 1.2522, the 50-day EMA - a key support. Key resistance has been defined at 1.2949.

FIXED INCOME

BUND TECHS: (U1) Remains Soft

• RES 4: 177.69 1.764 proj of the May 19 - Jun 11 - Jun 22 price swing
• RES 3: 177.61 High Aug 05 and the bull trigger
• RES 2: 177.24 High Aug 17 and 19
• RES 1: 176.87 High Aug 25
• PRICE: 175.83 @ 05:14 BST Aug 27
• SUP 1: 175.62 Low Jul 26
• SUP 2: 175.39 50-day EMA
• SUP 3: 174.90 Trendline support drawn from the May 19 low
• SUP 4: 174.64 50.0% retracement of the Jul 22 - Aug 5 rally

Bund futures traded sharply lower Wednesday The contract has moved below its 20-day EMA and support at 176.21, Aug 11 low. The break lower suggests scope for a deeper short-term corrective pullback with attention on the 50-day EMA that intersects at 175.39. On the upside, price would need to move above the Aug 25 high of 176.87 to ease the current bearish pressure. This would open 177.24, the Aug 17 and 19 high.

BOBL TECHS: (U1) Remains Below Its 20-Day EMA

• RES 4: 135.700 High Dec 11, 2020 (cont)
• RES 4: 135.640 High Aug 05 and the bull trigger
• RES 3: 135.430 High Aug 20 a key near-term resistance
• RES 2: 135.340 Aug 25 high
• PRICE: 135.100 @ 05:14 BST Aug 27
• SUP 1: 135.030 Low Jul 26
• SUP 2: 134.968 50-day EMA
• SUP 3: 134.710 High Aug 7
• SUP 4: 134.591 Trendline support drawn from the May 20 low

Bobl futures traded lower Wednesday. This resulted in a break of the 20-day EMA and support at 135.140, the Aug 13 low. The move lower signals potential for a deeper corrective pullback and opens the 50-day EMA that intersects at 134.968. On the upside, initial key resistance has been defined at 135.430, Aug 20 high. A break would reinstate a bullish theme and open 135.640, Aug 5 high and the bull trigger.

SCHATZ TECHS: (U1) Tests Support

• RES 4: 112.425 2.618 proj of the Jun 22 - Jul 8 - Jul 13 price swing
• RES 3: 112.415 High Aug 05 and the bull trigger
• RES 2: 112.390 High Aug 6:
• RES 1: 112.350 High Aug 20 and key near-term resistance
• PRICE: 112.310 @ 05:30 BST Aug 27
• SUP 1: 112.295 Low Aug 13, 16 and 26
• SUP 2: 112.283 50-day EMA
• SUP 3: 112.245 Low Jul 21
• SUP 4: 112.210 Low Jul 20

Schatz futures traded through its 20-day EMA Wednesday exposing and yesterday testing support at 112.295, the Aug 13 and 16 low. The 50-day EMA, intersects at 112.283. A clear break of the average is required to suggest scope for a deeper short-term pullback. On the upside, initial firm resistance has been refined at 112.350, Aug 20 high where a break is needed to ease the developing bearish risk.

GILT TECHS: (Z1) Probes Support

• RES 4: 130.72 High Aug 4 and the bull trigger (cont)
• RES 3: 130.53 High Aug 5 (cont)
• RES 2: 129.35 High Aug 20 and a key near-term resistance
• RES 1: 129.09 High Aug 25
• PRICE: 128.53 @ Close Aug 26
• SUP 1: 128.24 Low Aug 12
• SUP 2: 128.03 Low Jul 6 (cont)
• SUP 3: 127.50 Low Jun 28 (cont)
• SUP 4: 127.25 Low Jun 23 (cont)

Gilt futures traded lower again yesterday and probed initial support at 128.33, the Aug 12 low. A clear break of this support would suggest scope for a deeper pullback. This would open 128.03 (cont), the Jul 6 low. A breach of this support would strengthen a bearish case and note that it would also highlight a move below the 50-day EMA on the continuation chart. Key near-term resistance has been defined at 129.35.

BTP TECHS: (U1) Testing The 50-Day EMA

• RES 4: 157.71 High Aug 5 and the bull trigger
• RES 3: 155.43 High Aug 13
• RES 2: 155.11 High Aug 25
• RES 1: 154.74 Former channel support drawn off the May 19 low
• PRICE: 153.76 @ Close Aug 26
• SUP 1: 153.61/53 50-day EMA / Low Aug 26
• SUP 2: 153.14 Low Jul 22
• SUP 3: 152.84 50.0% retracement of the May 25 - Aug 5 rally
• SUP 4: 152.66 Low Jul 15

BTP futures traded lower yesterday. The contract has this week cleared a key support at 154.54 marking the base of a bull channel drawn off the May 19 low. The bearish breakout signals scope for a deeper corrective pullback and attention is on the 50-day EMA at 153.61, probed yesterday. A clear break of the average is required to suggest scope for further downside. Initial resistance is at the former channel base - at 154.74 today.

EQUITIES

EUROSTOXX 50 TECHS: (U1) Bullish Focus

• RES 4: 4294.20 1.236 proj of the May 13 - Jun 17 - Jul 19 price swing
• RES 3: 4259.37 2.0% 10-dma envelope
• RES 2: 4238.50 High Aug 13 and the bull trigger
• RES 1: 4200.60 76.4% retracement of the Aug 13 - 19 sell-off
• PRICE: 4166.00 @ 05:45 BST Aug 27
• SUP 1: 4078.00 Low Aug 19 and the bear trigger
• SUP 2: 4026.20 76.4% retracement of the Jul 19 - Aug 13 rally
• SUP 3: 3944.00 Low Jul 21
• SUP 4: 3895.00 Low Jul 19

EUROSTOXX 50 futures outlook remains bullish. Gains since Aug 19 suggest the sell-off between Aug 13 - 19 has been a correction and that this correction is over. A key support has been defined at 4078.00, Aug 19 low. While it holds, scope is seen for an extension higher and a retest of 4238.50, the Aug 13 high and bull trigger. On the downside, a break of 4078.00 would instead reinstate a bearish theme.

E-MINI S&P (U1): Remains Bullish

• RES 4: 4580.21 1.382 proj of Jun 21 - Jul 14 - 19 price swing
• RES 3: 4542.58 1.236 proj of Jun 21 - Jul 14 - 19 price swing
• RES 2: 4500.00 Round number resistance
• RES 1: 4498.00 High Aug 25
• PRICE: 4476.25 @ 06:49 BST Aug 27
• SUP 1: 4434.55 20-day EMA
• SUP 2: 4366.96 50-day EMA
• SUP 3: 4347.75 Low Aug 19 and the bear trigger
• SUP 4: 4224.00 Low Jul 19 and key support

S&P E-minis outlook remains bullish and the contract has traded to fresh all-time highs of 4498.00. The move higher confirms a resumption of the uptrend. The contract's recent recovery from 4347.75, Aug 19 low means the 50-day EMA remains intact. This average intersects at 4366.96 and represents a key support area. A clear break of the 50-day EMA is required to signal a short-term reversal. Bullish.

COMMODITIES

BRENT TECHS: (V1) Holds Onto Gains

• RES 4: $75.65 - High Jul 30
• RES 3: $74.37 - Bear channel top drawn off the Jul 6 high
• RES 2: $73.55 - High Aug 3
• RES 1: $72.42 - High Aug 25
• PRICE: $72.15 @ 06:44 BST Aug 27
• SUP 1: $70.36/$68.53 - 20-day EMA / Low Aug 24
• SUP 2: $64.60 - Low Aug 23
• SUP 3: $63.89 - Low May 21 and a key support
• SUP 4: $63.43 - 1.236 proj of the Jul 6 - 20 - 30 price swing

Brent futures rallied Monday and bulls have not looked back. The recovery this week has defined a key short-term support at $64.60, Aug 23 low where a break is required to reinstate a bearish theme. Short-term, the outlook remains bullish and Monday's price pattern was a bullish engulfing candle. Further gains would open $73.55, the Aug 3 high ahead of $74.37, a bear channel top drawn off the Jul 6 high.

WTI TECHS: (V1) Heading North

• RES 4: $71.29 - High Aug 3
• RES 3: $70.74 - 764.% retracement of the Jul 30 - Aug 23 sell-off
• RES 2: $69.39 - High Aug 12 and key near-term resistance
• RES 1: $68.76 - Intraday high
• PRICE: $68.40 @ 06:47 BST Aug 27
• SUP 1: $66.92/65.41 - Low Aug 25 / Low Aug 24
• SUP 2: $61.74 - Low Aug 23
• SUP 3: $60.81 - 1.236 proj of the Jul 6 - 20 - 30 price swing
• SUP 4:$60.68 - Low May 21

WTI futures have rallied this week and remain firm. The recovery from Monday's low has defined a key short-term support at $61.74, Aug 23 low where a break is required to reinstate a bearish theme. Short-term, the outlook appears bullish and Monday's price pattern was a bullish engulfing candle, highlighting a reversal. The contract has traded above the 50-day EMA. This opens $69.39, Aug 12 high.

GOLD TECHS: Bullish Cycle

• RES 4: $1863.3 - High Jun 16
• RES 3: $1853.3 - 61.8% retracement of the Jun 1 - 29 decline
• RES 2: $1834.1 - High Jul 15 and the bull trigger
• RES 1: $1809.6 - High Aug 23
• PRICE: $1801.9 @ 07:00 BST Aug 27
• SUP 1: $1774.5 - Low Aug 19
• SUP 2: $1751.7 - Low Aug 13
• SUP 3: $1717.8 - Low Aug 10
• SUP 4: $1690.6 - Low Aug 08 and the bear trigger

Gold maintains a bullish tone. The yellow metal traded higher Monday and in the process cleared the 50-day EMA at $1796.50. The break confirms a resumption of the upleg that started Aug 9. This signals scope for a climb towards resistance at $1834.1, Jul 15 high and a bull trigger. On the downside, initial support has been defined at $1774.5, Aug 19 low. A move below this support would be bearish and signal a short-term reversal.

SILVER TECHS: Resistance Remains Intact

• RES 4: $26.467 - High Jul 14
• RES 3: $26.002 - High Aug 04 and a key resistance
• RES 2: $24.898 - 50-day EMA
• RES 1: $24.013 - 20-day EMA
• PRICE: $23.694 @ 07:04 BST Aug 27
• SUP 1: $22.626 - Low Aug 09 and the bear trigger
• SUP 2: $21.899 - Low Nov 30, 2020
• SUP 3: $20.871 - 50% retracement of the Mar '20 - Jan '21 rally
• SUP 4: $20.000 - Psychological round number

Silver has traded higher this week but remains vulnerable. Moving average conditions continue to highlight a bearish theme and note too that price action since Aug 9 still appears to be a flag - a bearish formation. A break and close below the Aug 9 low of $22.626 would confirm a resumption of bearish pressure and open a key Fibonacci support at 20.871, 50% of the Mar '20 - Feb '21 range. The 20-day EMA at $24.013 marks resistance.