MNI DAILY TECHNICAL ANALYSIS - Bunds Clear Key Support

Price Signal Summary – Bunds Clear Key Support

• A corrective cycle remains in play in the S&P E-Minis contract, signaling scope for a deeper pullback near-term. This is allowing an overbought reading in momentum studies to unwind. EUROSTOXX 50 futures remain in a bearish corrective cycle. The move lower this week, marks an extension of the pullback from last week’s 3822.00 high. The 20-day EMA has been breached.
• EURUSD remains bearish following this week’s breach of the key support and bear trigger at 0.9952, the Jul 14 low. This has confirmed an extension lower inside the bear channel. GBPUSD is trading closer to recent lows and remains vulnerable. This follows recent weakness that has resulted in a break of support at 1.1760, the Jul 14 low and bear trigger. USDJPY maintains a bullish tone despite yesterday’s pullback. The pair last week traded above 135.58, Aug 8 high and this strengthened a short-term bullish condition.
• Gold remains weak despite the recovery from Tuesday’s low. Recent gains saw price trade above trendline resistance drawn from the Mar 8 high. The break highlighted a potential reversal of the 5-month downtrend. WTI futures traded sharply higher Tuesday and this has improved the short-term outlook for bulls. Attention is on resistance at $94.17, Aug 11 high and this hurdle is just below the 50-day EMA, at $94.31.
• Bund futures continue to weaken, as the pullback from the Aug 2 high of 159.70 extends. The 50-day EMA has been cleared. This marked a key support area and the clear break has strengthened bearish conditions and signals scope for a continuation lower. Gilt futures remain vulnerable and last week’s sharp sell-off plus this week’s follow through, reinforces the current bearish climate. Recent weakness has also resulted in the break of trendline support drawn from the Jun 16 low.

FOREIGN EXCHANGE

EURUSD TECHS: Bears Still The Driver’s Seat

• RES 4: 1.0327 High Aug 12
• RES 3: 1.0264 Channel top drawn from the Feb 10 high
• RES 2: 1.0097/0147 Low Jul 27 / 20-day EMA
• RES 1: 1.0047 High Aug 22
• PRICE: 0.9985 @ 16:39 BST Aug 23
• SUP 1: 0.9883 1.764 projection of the Jun 9 - 15 - 27 price swing
• SUP 2: 0.9800 Round number support
• SUP 3: 0.9785 2.00 projection of the Jun 9 - 15 - 27 price swing
• SUP 4: 0.9734 Channel base drawn from the Feb 10 high

EURUSD remains bearish following this week’s breach of the key support and bear trigger at 0.9952, the Jul 14 low. This has confirmed an extension lower inside the bear channel and more importantly confirmed a resumption of the primary downtrend. The focus is on 0.9883 next, a Fibonacci projection while further out, scope is seen for a move towards the channel base at 0.9725. Initial resistance is at 1.0047, Monday’s high.

GBPUSD TECHS: Remains Vulnerable

• RES 4: 1.2217 High Aug 12
• RES 3: 1.2126 50-day EMA
• RES 2: 1.2004/1.2016 Low Aug 5 / 20-day EMA
• RES 1: 1.1878/1938 High Aug 23 / 19
• PRICE: 1.1854 @ 16:40 BST Aug 23
• SUP 1: 1.1718 Low Aug 23
• SUP 2: 1.1673 1.00 proj of the May 27 - Jun 14 - 16 price swing
• SUP 3: 1.1640 Low Mar 25 2020
• SUP 4: 1.1503 Low Mar 24 2020

GBPUSD is trading closer to recent lows and remains vulnerable. This follows recent weakness that has resulted in a break of support at 1.1760, the Jul 14 low and bear trigger. The break of 1.1760 confirms a resumption of the downtrend and paves the way for a move towards 1.1673, a Fibonacci projection. On the upside, firm short-term resistance is seen at 1.2004, the Aug 5 low.

EURGBP TECHS: Support Intact For Now

• RES 4: 0.8627 High Jul 4
• RES 3: 0.8585 High Jul 21 and a key resistance
• RES 2: 0.8525 High Jul 25
• RES 1: 0.8466/8512 50-day EMA / High Aug 19
• PRICE: 0.8423 @ 06:27 BST Aug 24
• SUP 1: 0.8416 Low Aug 23
• SUP 2: 0.8388/40 Low Aug 17 / 2 and the bear trigger
• SUP 3: 0.8313 Low Apr 22
• SUP 4: 0.8276 2.0% 10-dma envelope and low Apr 14

EURGBP has pulled back from last week’s highs. The high print of 0.8512 last week (Aug 19), threatens the recent bearish theme and signals scope for an extension higher, despite this week’s pullback. A resumption of gains would open 0.8525 and potentially 0.8585 further out, the Jul 25 and 21 highs respectively. Initial key support is at 0.8388, the Aug 17 low. A break would reinstate a bearish theme.

USDJPY TECHS: Trend Needle Still Points North

• RES 4: 139.39 High Jul 14 and key resistance
• RES 3: 138.88 High Jul 21
• RES 2: 137.96 High Jul 22
• RES 1: 137.71 High Aug 22
• PRICE: 136.53 @ 06:42 BST Aug 24
• SUP 1: 135.72 Low Aug 19
• SUP 2: 135.25/134.45 20- and 50-day EMA
• SUP 3: 132.56 Low Aug 15
• SUP 4: 131.74 Low Aug 11

USDJPY maintains a bullish tone despite yesterday’s pullback. The pair last week traded above 135.58, Aug 8 high and this strengthened a short-term bullish condition. 137.27, 76.4% of the Jul 14 - Aug 2 downleg, has been cleared reinforcing current conditions. This signals scope for a continuation higher towards 137.96, the Jul 22 high. On the downside, initial firm support is seen at the 50-day EMA which intersects at 134.45.

EURJPY TECHS: Short-Term Outlook Remains Bearish

• RES 4: 139.67 Trendline resistance drawn from the Jun 28 high
• RES 3: 139.41 High Jul 28
• RES 2: 138.40 High Aug 10
• RES 1: 138.02 50-day EMA
• PRICE: 136.09 @ 16:47 BST Aug 23
• SUP 1: 134.95 Low Aug 16
• SUP 2: 133.40 Low Aug 2 and a bear trigger
• SUP 3: 132.66 Low May 12 and a key support
• SUP 4: 131.99 61.8% retracement of the Mar 7 - Jun 28 bull leg

EURJPY traded lower again Tuesday and remains soft. The short-term outlook is bearish. Moving average studies highlight a downtrend and the 50-day EMA, at 137.95, remains intact and marks a firm resistance. A strong resumption of weakness would open the 133.40 bear trigger. On the upside, clearance of resistance at the 50-day EMA would instead alter the picture and open the 139.55 trendline resistance.

AUDUSD TECHS: Bearish Threat Remains Present

• RES 4: 0.7246 High Jun 7
• RES 3: 0.7184 3.0% Upper Bollinger Band
• RES 2: 0.7137 High Aug 11
• RES 1: 0.6966/7040 50-day EMA / High Aug 16
• PRICE: 0.6905 @ 07:07 BST Aug 24
• SUP 1: 0.6856 Low Aug 23
• SUP 2: 0.6789 76.4% retracement of the Jul 14 - Aug 11 upleg
• SUP 3: 0.6719 Low Jul 15
• SUP 4: 0.6682 14 and the bear trigger

A bearish threat in AUDUSD remains present following the recent retracement from 0.7137, the Aug 11 high. The move lower last week resulted in a print below 0.6870, the Aug 5 low. Clearance of this level would undermine the recent bull theme and signal scope for a deeper pullback. Initial firm resistance has been defined at 0.7040, the Aug 16 high where a break is required to ease the current bearish pressure.

USDCAD TECHS: Bullish Moving Average Set-Up

• RES 4: 1.3224 High Jul 14 and key resistance
• RES 3: 1.3135 High Jul 15
• RES 2: 1.3107 76.4% retracement of the Jul 14 - Aug 11 downleg
• RES 1: 1.3063 High Aug 23
• PRICE: 1.2979 @ 07:22 BST Aug 24
• SUP 1: 1.2934/2905 Low Aug 23 / 20-day EMA
• SUP 2: 1.2828/2761 Low Aug 17 / 200-dma
• SUP 3: 1.2728 Low Aug 11 and key support
• SUP 4: 1.2685 76.4% retracement of the Jun 8 - Jul 14 upleg

Despite the Tuesday stumble in USDCAD, the short-term trend remains in bulls’ favour. The pair has recently confirmed a clear break of resistance at 1.2985, Aug 5 high and a key short-term hurdle. The break strengthens bullish conditions and opens 1.3107 next, a Fibonacci retracement. Note that moving average studies are in a bull mode condition, highlighting an uptrend. Initial firm support is at 1.2905, the 20-day EMA.

FIXED INCOME

BUND TECHS: (U2) Heading Lower

• RES 4: 158.33/159.70 High Aug 3 / 2 and the bull trigger
• RES 3: 157.74 High Aug 10
• RES 2: 154.26/156.88 20-day EMA / High Aug 15
• RES 1: 153.59 50-day EMA
• PRICE: 150.74 @ 05:11 BST Aug 24
• SUP 1: 150.23 Low Aug 24
• SUP 2: 150.00 Round number support
• SUP 3: 149.69 Low Jul 21 and key short-term support
• SUP 4: 148.24 Low Jul 1

Bund futures continue to weaken, as the pullback from the Aug 2 high of 159.70 extends. The 50-day EMA has been cleared. This marked a key support area and the clear break has strengthened bearish conditions and signals scope for a continuation lower. The focus is on the 150.00 handle next. On the upside, key resistance is at 156.88, Aug 15 high. Initial firm resistance is at 153.59, the 50-day EMA.

BOBL TECHS: (U2) Southbound

• RES 4: 128.060/128.760 High Aug 3 / 2 and the bull trigger
• RES 3: 127.580 High Aug 10
• RES 2: 126.174/127.290 20-day EMA / High Aug 15
• RES 1: 125.948 50-day EMA
• PRICE: 124.690 @ 05:17 BST Aug 24
• SUP 1: 124.300 Low Aug 23
• SUP 2: 124.030 Low Jul 21 and a reversal trigger
• SUP 3: 123.309 61.8% retracement of the Jun 16 - Aug 2 rally
• SUP 4: 122.180 Low Jun 29

Bobl futures remain bearish and the contract traded lower once again yesterday. The 50-day EMA has been breached and the deeper pullback has opened 124.030, the Jul 21 low and a reversal trigger. Note that the contract has also breached a trendline support drawn from the Jun 16 low, reinforcing bearish conditions. Initial firm resistance has been defined at 127.290, the Aug 15 high. The 50-day EMA at 125.948 is first resistance.

SCHATZ TECHS: (U2) Outlook Remains Bearish

• RES 4: 110.380 High Aug 2 and the bull trigger
• RES 3: 110.100 HIgh Aug 3
• RES 2: 109.613/915 20-day EMA / High Aug 16
• RES 1: 109.588 50-day EMA
• PRICE: 109.260 @ 05:25 BST Aug 24
• SUP 1: 109.175 Low Aug 22
• SUP 2: 109.042 50.0% retracement of the Jun 16 - Aug 2 upleg
• SUP 3: 108.950 Low Jul 21 and a key support
• SUP 4: 108.727 61.8% retracement of the Jun 16 - Aug 2 upleg

Schatz futures remain bearish and continue to trade below the early August highs. Last week’s sell-off resulted in a break of the 50-day EMA, reinforcing bearish conditions. The focus is on 109.042, a Fibonacci retracement. On the upside, initial firm resistance has been defined at 109.915, the Aug 16 high. A break of this level is required to ease the current bearish pressure. The 50-day EMA, at 109.588, is first resistance.

GILT TECHS: (U2) Impulsive Sell-Off

• RES 4: 118.10 High Aug 10
• RES 3: 117.15 High Aug 15 and key short-term resistance
• RES 2: 114.53/115.32 High Aug 18 / 20-day EMA
• RES 1: 113.57 High Aug 22
• PRICE: 111.82 @ Close Aug 23
• SUP 1: 111.17 Low Aug 23
• SUP 2: 110.57 Low Jun 21
• SUP 3: 109.89 Low Jun 16 and major support
• SUP 4: 109.00 Round number support

Gilt futures remain vulnerable and last week’s sharp sell-off plus this week’s follow through, reinforces the current bearish climate. Recent weakness has also resulted in the break of trendline support drawn from the Jun 16 low. Attention is on key support at 109.89, the Jun 16 low and a key medium-term bear trigger. Initial resistance is at 113.57, Aug 22 high. A firmer level has been defined at 117.15, Aug 15 high.

BTP TECHS: (U2) Bear Trend Extends

• RES 4: 130.00 Round number resistance
• RES 3: 129.36 High Aug 11 and the bull trigger
• RES 2: 125.24/127.15 50-day EMA / High Aug 17
• RES 1: 124.02 High Aug 22
• PRICE: 121.75@ Close Aug 23
• SUP 1: 121.08 Low Aug 23
• SUP 2: 120.85 Low Jul 22
• SUP 3: 119.57 Low Jul 21 and a key support
• SUP 4: 118.60 Low Jun 22

BTP futures traded lower again yesterday and bearish conditions have strengthened The recent move lower has resulted in a break below both the 20- and 50-day EMAs. Furthermore, the move through 124.07 last Friday, confirmed a break of trendline support drawn from the Jun 14 low. The clear breach has opened 119.57, the Jul 21 low. Initial firm resistance is seen at 125.24, the 50-day EMA.

US 10YR FUTURE TECHS: (U2) Bear Cycle Still In Play

• RES 4: 122-02 High Aug 2 and key resistance
• RES 3: 120-29 High Aug 4
• RES 2: 119-31/120-22 High Aug 15 / 10
• RES 1: 118-14/119-04+ Intraday high / 20-day EMA
• PRICE: 118-05 @ 16:23 BST Aug 23
• SUP 1: 117-14+ Low Jul 21 & Aug 23 and key near-term support
• SUP 2: 117-07 61.8% retracement of the Jun 14 - Aug 2 bull cycle
• SUP 3: 116-26+ Low Jun 29
• SUP 4: 116-11 Low Jun 28

Treasuries maintain a softer tone and the contract has traded lower Monday. 118-05, 50.0% of the Jun 14 - Aug 2 bull cycle, has been cleared and this signals scope for an extension towards 117-14+ next, the Jul 21 low. Price has recently cleared a trendline support drawn from the Jun 14 low and this reinforces the current bearish theme. Initial firm resistance is at 119-31, the Aug 15 high.

EQUITIES

EUROSTOXX50 TECHS: (U2) Has Breached The 50-Day EMA

• RES 4: 3855.00 High Apr 21
• RES 3: 3822/40.00 High Aug 17 / High Jun 6 and key resistance zone
• RES 2: 3782.00 High Aug 18
• RES 1: 3726.00 High Aug 22
• PRICE: 3631.00 @ 05:33 BST Aug 24
• SUP 1: 3621.00 Low Aug 23
• SUP 2: 3582.50 50.0% retracement of the Jul 5 - Aug 17 rally
• SUP 3: 3526.00 61.8% retracement of the Jul 5 - Aug 17 rally
• SUP 4: 3467.00 Low Jul 18 / 19

EUROSTOXX 50 futures remain in a bearish corrective cycle. The move lower this week, marks an extension of the pullback from last week’s 3822.00 high. The 20-day EMA has been breached. The clear break signalled scope for an extension lower and exposed the 50-day EMA at 3650.60,. This average has now been cleared, reinforcing bearish conditions. Key resistance is at 3822.00 ahead of 3840.00. The latter is the Jun 6 high.

E-MINI S&P (U2): Approaching The 50-Day EMA

• RES 4: 4419.15 2.236 proj of the Jun 17 - 28 - Jul 14 price swing
• RES 3: 4345.75 2.00 proj of the Jun 17 - 28 - Jul 14 price swing
• RES 2: 4288.00/4327.50 High Aug 19 /16 and the bull trigger
• RES 1: 4221.50 High Aug 22
• PRICE: 4125.00 @ 07:01 BST Aug 24
• SUP 1: 4082.81 50-day EMA
• SUP 2: 4000.00 Round number support
• SUP 3: 3994.50 Low Jul 28
• SUP 4: 3913.25 Low Jul 26 and a key support

A corrective cycle remains in play in the S&P E-Minis contract, signalling scope for a deeper pullback near-term. This is allowing an overbought reading in momentum studies to unwind. The 20-day EMA has been breached and attention is on the 50-day EMA, at 4082.81 - a key pivot support. Key resistance and the bull trigger is at 4327.50, the Aug 16 high. Initial resistance is at 4221.50, Monday’s high.

COMMODITIES

BRENT TECHS: (V2) Testing Resistance

• RES 4: $110.72 - High Jul 5
• RES 3: $106.50 - High Jul 29 and a key resistance
• RES 2: $102.41 - High Aug 2 / 3
• RES 1: $100.45 - Intraday high
• PRICE: $99.93 @ 06:45 BST Aug 24
• SUP 1: $96.53/91.22 - Low Aug 23 / Low Jul 14 and the bear trigger
• SUP 2: $90.00 - Round number support
• SUP 3: $88.31 - Low Mar 9 and a key support
• SUP 4: $85.88 - Low Feb 25

Brent futures traded sharply higher yesterday. This has strengthened short-term conditions for bulls. Price is testing resistance at $100.38, the Aug 12 high and $100.21, the 50-day EMA. A clear breach of these two resistance points would signal a stronger short-term reversal and open $102.41, the Aug 2 / 3 high. On the downside, key support is unchanged at $91.22, Jul 14 low. A break would confirm a resumption of bearish activity.

WTI TECHS: (V2) Approaching Key Resistance

• RES 4: $108.07 - High Jun 29
• RES 3: $105.00 - High Jul 5
• RES 2: $99.75 - High Jul 29 and key resistance
• RES 1: $94.17/31 - High Aug 11 / 50-day EMA values
• PRICE: $93.49 @ 05:51 BST Aug 24
• SUP 1: $85.37 - Low Aug 16 and the bear trigger
• SUP 2: $84.10/00 - Low Mar 15 / Round number support
• SUP 3: $81.88 - Low Feb 25
• SUP 4: $80.00 - Round number support

WTI futures traded sharply higher Tuesday and this has improved the short-term outlook for bulls. Attention is on resistance at $94.17, Aug 11 high and this hurdle is just below the 50-day EMA, at $94.31. Clearance of these two resistance points would highlight a short-term reversal and signal scope for a climb towards $99.75, the Jul 29 high. On the downside, key support has been defined at $85.37, Aug 16 low. This level is the bear trigger.

GOLD TECHS: Bear Cycle Still In Play

• RES 4: $1857.6 - High Jun 16
• RES 3: $1829.8 - 38.2% retracement of the Mar 8 - Jul 21 bear leg
• RES 2: $1778.2/1807.9 - 50-day EMA / High Aug 10 and bull trigger
• RES 1: $1763.3 - 20-day EMA
• PRICE: $1745.4 @ 07:15 BST Aug 24
• SUP 1: $1727.8 - Low Aug 22
• SUP 2: $1711.7 - Low Jul 27
• SUP 3: $1681.0 - Low Jul 21 and the bear trigger
• SUP 4: $1676.9 - Low Mar 8 2021

Gold remains weak despite the recovery from Tuesday’s low. Recent gains saw price trade above trendline resistance drawn from the Mar 8 high. The break highlighted a potential reversal of the 5-month downtrend. However, the failure to follow through and the breach last week of support at $1754.4 Aug 3 low, confirms a failed attempt at clearing the trendline. Sights are on $1711.7 next, the Jul 27 low. Key resistance is $1807.9.

SILVER TECHS: Bearish Theme

• RES 4: $21.000 - Round number resistance
• RES 3: $21.540 - High Jun 27
• RES 2: $20.876 - High Aug 15 and the bull trigger
• RES 1: $19.747 - 20-day EMA
• PRICE: $19.082 @ 08:03 BST Aug 24
• SUP 1: $18.723 - Low Aug 22
• SUP 2: $18.146/18.000 - Low Jul 14 / Round number support
• SUP 3: $17.312 - 3.00 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 4: $16.955 - Low Jun 15 2020

Silver is consolidating and remains bearish. The move lower last week resulted in a break of $19.551, Aug 5 low. The breach undermines the recent bullish theme and has exposed the key support and bear trigger at $18.146. A move below this level would confirm a resumption of the broader downtrend. Key short-term resistance has been defined at $20.876, the Aug 15 high where a break is required to reinstate a bullish theme.