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MNI DAILY TECHNICAL ANALYSIS - Bunds Hit Bull Trigger, Rally Sharply

Price Signal Summary – Bunds Hit Bull Trigger, Rally Sharply

  • In the equity space, S&P E-minis again registered a fresh all-time high, but has faded in early Europe. Nonetheless, the break confirms a resumption of the underlying uptrend. EUROSTOXX 50 futures trade lower in early Europe, running against the recent uptrend. Nonetheless, moving average signals still point north.
  • In FX, EURUSD remains above its recent low, but is clearly vulnerable. This week's sell-off resulted in a print below the 1.1300 handle and the base of a bear channel drawn from the Jun 1 high. GBPUSD gains continue to be viewed as a short-term correction. The outlook is bearish following the recent breach of 1.3412, Sep 29 low. This break confirmed a resumption of the bear trend and has paved the way for an extension lower. USDJPY found resistance during Wednesday's session. The price pattern on this day is a bearish engulfing candle and represents a short-term concern for bulls.
  • On the commodity front, Gold continues to consolidate but remains bullish. Recent gains and a clear break of resistance at $1834.0, Sep 3 high reinforces current bullish conditions and paves the way for further strength near-term. WTI futures traded lower yesterday before finding support. Futures have cleared $77.23, Nov 4 low. The break signals scope for a deeper corrective pullback as the recent overbought condition continues to unwind.
  • In the FI space, Bund futures have rallied sharply, cementing the bull flag as bullish conditions are reinforced further. Today's breach of 171.95 - the 76.4% retracement of the Aug - Nov sell-off puts near-term momentum well in favour of bulls. The near-term outlook in Gilt futures remains bullish and the recent pullback is considered corrective. A double bottom reversal that was confirmed on Oct 27 and a bullish price sequence of higher highs and higher lows highlights the current uptrend.

FOREIGN EXCHANGE

EURUSD TECHS: Remains Vulnerable

  • RES 4: 1.17155 / High Sep 22
  • RES 3: 1.1630/92 Bear channel top from Jun 1 high / High Oct 28
  • RES 2: 1.1514/1608 Low Nov 5 / High Nov 9
  • RES 1: 1.1386 High Nov 16
  • PRICE: 1.1303 @ 09:09 GMT Nov 19
  • SUP 1: 1.1264 Low Nov 17
  • SUP 2: 1.1222 1.618 proj of the Jan 6 - Mar 31 - May 25 price swing
  • SUP 3: 1.1185 Low Jul 1, 2020
  • SUP 4: 1.1128 1.764 proj of the Jan 6 - Mar 31 - May 25 price swing

EURUSD remains above its recent low, but is clearly vulnerable. This week's sell-off resulted in a print below the 1.1300 handle and the base of a bear channel drawn from the Jun 1 high. A clear breach of this area would strengthen bearish conditions with the next objective at 1.1222, a Fibonacci retracement. Any near-term base building however would suggest a possible reversal from the channel base. Initial resistance is at 1.1386, Tuesday's high.

GBPUSD TECHS: Corrective Cycle Still In Play

  • RES 4: 1.3913 High Sep 14 and a key resistance
  • RES 3: 1.3835 High Oct 20
  • RES 2: 1.3628 50-day EMA
  • RES 1: 1.3542/3607 20-day EMA / High Nov 9 and a key resistance
  • PRICE: 1.3490 @ 06:14 GMT Nov 19
  • SUP 1: 1.3397/53 Low Nov 17 / Low Nov 12 and the bear trigger
  • SUP 2: 1.3334 1.00 proj of the Sep 14 - 29 - Oct 20 price swing
  • SUP 3: 1.3304 Low Dec 22, 2020
  • SUP 4: 1.3216 1.236 proj of the Sep 14 - 29 - Oct 20 price swing

GBPUSD gains continue to be viewed as a short-term correction. The outlook is bearish following the recent breach of 1.3412, Sep 29 low. This break confirmed a resumption of the bear trend and has paved the way for an extension lower. Furthermore, moving average studies are in a bear mode, reinforcing current conditions. The focus is on 1.3334 next, a Fibonacci projection. Firm resistance has been defined at 1.3607, Nov 9 high.

EURGBP TECHS: Remains In A Downtrend

  • RES 4: 0.8595/98 High Nov 5 / 76.4% of the Sep 29 - Oct 26 sell-off
  • RES 3: 0.8538/74 High Nov 15 / High Nov 11
  • RES 2: 0.8505 50-day EMA
  • RES 1: 0.8463/64- Nov 3 low / 20-day EMA
  • PRICE: 0.8416 @ 06:22 GMT Nov 19
  • SUP 1: 0.8383 Low Nov 18
  • SUP 2: 0.8356 Low Feb 26, 2020
  • SUP 3: 0.8339 Low Feb 25, 2020
  • SUP 4: 0.8282/77 Low Feb 18, 2020 / Low Dec 13, 2019

EURGBP remains in a downtrend following this week's sharp sell-off. The recent key technical break has been the move though support at 0.8403, Oct 26 low. The break reinforces bearish conditions and confirms a resumption of the broader downtrend. This has opened 0.8356 next, the Feb 26, 2020 low. Note too that the cross is approaching the base - at 0.8300 - of a broad multi-year range. Initial resistance is seen at 0.8463.

USDJPY TECHS: Monitoring A Bearish Engulfing Candle

  • RES 4: 116.87 High Jan 1, 2017
  • RES 3: 116.09 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
  • RES 2: 115.51 High Mar 10, 2017
  • RES 1: 114.99 1.50 proj of Apr 23 - Jul 2 - Aug 4 price swing
  • PRICE: 114.34 @ 06:26 GMT Nov 19
  • SUP 1: 113.76 Low Nov 12 / 15
  • SUP 2: 112.81/73 50-day EMA / Low Nov 9
  • SUP 3: 112.08 High Sep 30 and a recent breakout level
  • SUP 4: 111.51 Low Oct 8

USDJPY remains in an uptrend and this week's break of 114.70, Oct 20 high confirms a resumption of this trend. The pair however found resistance during Wednesday's session. The price pattern on this day is a bearish engulfing candle and represents a short-term concern for bulls. A deeper pullback would expose key support at 112.73, Nov 9 low. Clearance of 114.97, Wednesday's high would remove bearish concerns and resume the uptrend.

EURJPY TECHS: Remains Bearish Despite Yesterday's Bounce

  • RES 4: 132.92/133.48 High Oct 29 / High Oct 20
  • RES 3: 132.56 High Nov 4
  • RES 2: 130.73/131.76 50-day EMA / 20-day EMA
  • RES 1: 130.12 High Nov 16
  • PRICE: 129.82 @ 06:30 GMT Nov 19
  • SUP 1: 129.04 Low Nov 17
  • SUP 2: 128.63 Low Oct 7
  • SUP 3: 128.33 Low Oct 6
  • SUP 4: 127.93 Low Sep 22 and a key support

EURJPY remains bearish despite yesterday's bounce. The cross remains below its 50- and 20-day EMAs - the recent breach of these averages strengthened a bearish case. Price has also cleared 129.24, 76.4% of the Sep 22 - Oct 20 rally. This opens 128.33, Oct 6 low ahead of a key support at 127.93, Sep 22 low. Resistance is at 130.73, the 20-day EMA and 130.76, the 50-day EMA. A break of this zone is required to signal a base.

AUDUSD TECHS: Channel Base Holding For Now

  • RES 4: 0.7599 High Jul 6
  • RES 3: 0.7537/57 200-dma / 50.0% of the Feb - Aug sell-off
  • RES 2: 0.7432/7471 High Nov 9 / High Nov 4
  • RES 1: 0.7371 High Nov 15
  • PRICE: 0.7284 @ 06:38 GMT Nov 19
  • SUP 1: 0.7255/50 Channel base drawn from Aug 20 low / Low Nov 18
  • SUP 2: 0.7226 Low Oct 6
  • SUP 3: 0.7170 Low Sep 29
  • SUP 4: 0.7106 Low Aug 20 and a major support

AUDUSD has this week traded below 0.7261, 76.4% of the Sep 29 - Oct 28 rally and more importantly tested 0.7255, the base of a bull channel drawn from the Aug 20 low. The recent move lower is considered corrective and the base represents an important support. A channel breakout though would signal scope for a deeper retracement. Resistance to watch is 0.7371, Nov 15 high. A break would suggest a base has been established.

USDCAD TECHS: Bullish Theme

  • RES 4: 1.2775 High Sep 29
  • RES 3: 1.2739 High Oct 1
  • RES 2: 1.2664 61.8.0% retracement of the Sep 20 - Oct 21 sell-off
  • RES 1: 1.2647 High Nov 18
  • PRICE: 1.2590 @ 06:41 GMT Nov 19
  • SUP 1: 1.2493/2387 Low Nov 16 / 10
  • SUP 2: 1.2288 Low Oct 21 and the bear trigger
  • SUP 3: 1.2253 Low Jun 23
  • SUP 4: 1.2229 76.4% retracement of the Jun - Aug rally

USDCAD conditions remain bullish and the pair traded higher once again yesterday. Recent gains have confirmed a resumption of the current uptrend and the pair has breached the 50% retracement of the Sep 20 - Oct 21 sell-off at 1.2592. This has opened 1.2664 next, the 61.8% retracement. Further out, there is scope for a climb towards the October high of 1.2739. Initial firm support lies at 1.2493, Nov 16 low.

FIXED INCOME

BUND TECHS: (Z1) Bull Flag Confirmed

  • RES 4: 172.65 50.0% retracement of the Aug - Nov sell-off
  • RES 3: 172.12 High Sep 14
  • RES 2: 172.11 200-dma (continuation)
  • RES 1: 171.96 High Nov 19
  • PRICE: 171.12 @ 09:41 GMT Nov 19
  • SUP 1: 170.06 Low Nov 5
  • SUP 2: 168.98 Low Nov 3
  • SUP 3: 167.69 Low Nov 1 and the bear trigger
  • SUP 4: 167.52 Low Mar 19 2020 (cont)

Bund futures have rallied sharply, cementing the bull flag as bullish conditions are reinforced further. Today's breach of 171.95 - the 76.4% retracement of the Aug - Nov sell-off puts near-term momentum well in favour of bulls, opening potential for gains toward level. On the downside, initial support to watch is unchanged at 170.06.

BOBL TECHS: (Z1) Clears Recent Highs

  • RES 4: 136.14 High Aug 25
  • RES 3: 135.870 High Sep 3
  • RES 2: 135.660 High Sep 9
  • RES 1: 135.540 High Sep 21 and a key near-term resistance
  • PRICE: 135.490 @ 09:40 GMT Nov 19
  • SUP 1: 134.990 Low Nov 17
  • SUP 2: 134.700/320 Low Nov 11 / Low Nov 3
  • SUP 3: 133.900/690 Low Nov 2
  • SUP 4: 133.340 Low Mar 19 and key medium-term support (cont)

Bobl futures have resumed their upleg and the contract has traded through resistance at 135.320, Nov 15 high. This confirms a resumption of the short-term uptrend and opens135.540, Sep 21 high. The break higher also confirms an extension of the rally that started Oct 29 and scope is seen for a climb towards 135.650 further out. Initial firm support lies at 134.990, Nov 17 low ahead of the key short-term support at 134.700, Nov 11 low.

SCHATZ TECHS: (Z1) Resumes Its Uptrend

  • RES 4: 112.585 High Mar 17 2020 (cont)
  • RES 3: 112.505 High Nov 4 2020 (cont) and a key resistance
  • RES 2: 112.475 High Nov 5 2020 (cont)
  • RES 1: 112.465 Intraday high
  • PRICE: 112.450 @ 09:47 GMT Nov 19
  • SUP 1: 112.232 50-day EMA and key near-term support
  • SUP 2: 112.100 Low Nov 3
  • SUP 3: 112.050 Low Nov 2
  • SUP 4: 111.945 Low Oct 28 and major support

Schatz futures are off to the races this morning and the contract has cleared resistance at 112.410, Nov 15 high. The break higher confirms a resumption of the short-term uptrend and paves the way for gains towards 112.475 next, the Nov 5 2020 high (cont). Note that the break of 112.415 has resulted in a complete 100.0% retracement of the Aug -Sep sell-off, reinforcing the current bullish theme. Initial support lies at 112.232, the 50-day EMA.

GILT TECHS: (Z1) Support Defined At 125.40

  • RES 4: 128.18 High Sep 10 and 14
  • RES 3: 127.95 76.4% retracement of the Aug - Oct downleg
  • RES 2: 127.69 High Sep 21
  • RES 1: 126.82/127.29 High Nov 15 / High Nov 9
  • PRICE: 126.30 @ Close Nov 18
  • SUP 1: 125.40 Low Nov 17
  • SUP 2: 124.79/25 Low Nov 4 / Low Nov 1
  • SUP 3: 123.43 Low Oct 21 and the bear trigger
  • SUP 4: 123.16 Low Feb 27, 2019 (cont)

The near-term outlook in Gilt futures remains bullish and the recent pullback is considered corrective. A double bottom reversal that was confirmed on Oct 27 and a bullish price sequence of higher highs and higher lows highlights the current uptrend. A resumption of strength would refocus attention on 127.69 next, Sep 21 high. Initial firm support has been defined at 125.40, the Nov 17 low.

BTP TECHS: (Z1) Needle Points North

  • RES 4: 155.14 High Aug 31
  • RES 3: 154.64 High Sep 22 / 23 and a key resistance
  • RES 2: 153.59 High Sep 24
  • RES 1: 153.08 High Nov 10 and the bull trigger
  • PRICE: 151.92 @ Close Nov 18
  • SUP 1: 150.72 Nov 12 low
  • SUP 2: 149.89 Nov 3 low
  • SUP 3: 148.14 Low Nov 2
  • SUP 4: 147.12 Low Nov 1 and the bear trigger

BTP futures remain above recent lows. The outlook is bullish and the recent pullback is considered corrective. Recent gains confirmed a short-term bull cycle and last week's breach of 152.54, Oct 14 high strengthens this short-term condition. The break opens 153.59 next, Sep 24 high. Initial firm support is seen at 149.89, Nov 3 low where a break would undermine the positive theme. Key support has been defined at 147.12, Nov 1 low.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Starts Friday Poorly

  • RES 4: 4498.00 High Dec 27, 2007 (cont)
  • RES 3: 4448.00 High Jan 2, 2008 (cont)
  • RES 2: 4420.80 1.382 proj of the Jul 19 - Sep 6 - Oct 6 price swing
  • RES 1: 4409.50 High Nov 18
  • PRICE: 4366.00 @ 09:54 GMT Nov 19
  • SUP 1: 4307.10/4223.00 20-day EMA / High Sep 6
  • SUP 2: 4221.80 50-day EMA
  • SUP 3: 4119.00 Low Oct 18
  • SUP 4: 4004.00 / 3949.50 Low Oct 12 / Low Oct 6 and bear trigger

EUROSTOXX 50 futures trade lower in early Europe, running against the recent uptrend. Moving average signals still point north and the recent breach of 4223.00, Sep 6 high and a former bull trigger, highlighted an important bullish technical break. The psychological 4400.00 handle has been probed and the focus is on 4420.80 next, a Fibonacci projection. The 50-day EMA, at 4221.80, remains a key support.

E-MINI S&P (Z1): Fades Off All-Time High

  • RES 4: 4842.75 2.00 proj of Jul 19 - Aug 16 - Aug 19 price swing
  • RES 1: 4800.00 Round number resistance
  • RES 2: 4783.40 1.764 proj of Jul 19 - Aug 16 - Aug 19 price swing
  • RES 1: 4746.68 1.618 proj of Jul 19 - Aug 16 - Aug 19 price swing
  • PRICE: 4703.00 @ 09:56 GMT Nov 19
  • SUP 1: 4625.25 Low Nov 10
  • SUP 2: 4543.75 Low Oct 27
  • SUP 3: 4540.28/ 4472.00 50-day EMA / High Sep 27
  • SUP 4: 4317.25/4260.00 Low Oct 12 / Low Oct 1 and the bear trigger

S&P E-minis again registered a fresh all-time high, but has faded in early Europe. Nonetheless, the break confirms a resumption of the underlying uptrend and maintains the bullish price sequence of higher highs and higher lows. The focus is on 4747.68 next, a Fibonacci projection. Trend signals such as MA studies are in a bull mode set-up and corrections remain shallow, reinforcing bullish conditions. The 50-day EMA at 4540.28 represent a key support handle.

COMMODITIES

BRENT TECHS: (F2) Near-Term Outlook Remains Bearish

  • RES 4: $87.73 - 2.00 proj of the Aug 23 - Sep 3 - Sep 9 price swing
  • RES 3: $87.00 - Round number resistance
  • RES 2: $85.77 - High Oct 25 and the bull trigger
  • RES 1: $83.14 - High Nov 16
  • PRICE: $81.95 @ 07:06 GMT Nov 19
  • SUP 1: $78.42 - Low Oct 7
  • SUP 2: $77.19 - 38.2% retracement of the Aug 23 - Oct 25 rally
  • SUP 3: $75.80 - Low Sep 30
  • SUP 4: $74.70 - High Sep 15

Brent futures traded lower Yesterday before finding support. The contract has breached key short-term support at $80.20, Nov 4 low. This signals scope for a deeper corrective pullback as the recent overbought condition unwinds. Potential is seen for weakness towards $78.42, Oct 7 low. On the upside, initial firm resistance has been defined at $83.14, Nov 16 high where a break is required to ease the developing bearish theme.

WTI TECHS: (F2) Overbought Conditions Unwinds

  • RES 4: $85.00 - Round number resistance
  • RES 3: $84.50 - 1.236 proj of the Sep 21 - Oct 6 - 7 price swing
  • RES 2: $83.30/83.83 - High Nov 10 / High Oct 25 and the bull trigger
  • RES 1: $80.68 - High Nov 16 and key near-term resistance
  • PRICE: $79.06 @ 06:59 GMT Nov 19
  • SUP 1: $75.02 - 38.2% retracement of the Aug 23 - Oct 25 rally
  • SUP 2: $74.25 - Low Oct 7 and key near-term support
  • SUP 3: $72.36 - Low Sep 30
  • SUP 4: $70.81 - Low Sep 23

WTI futures traded lower yesterday before finding support. Futures have cleared $77.23, Nov 4 low. The break signals scope for a deeper corrective pullback as the recent overbought condition continues to unwind. Potential is seen for weakness towards $74.25, Oct 7 low. On the upside, initial firm resistance has been defined at $80.68, Nov 16 high where a break is required to ease the developing bearish theme.

GOLD TECHS: Bull Theme Intact

  • RES 4: $1916.6 - High Jun 1 and a key resistance
  • RES 3: $1909.7 - High Jun 3
  • RES 2: $1903.8 - High Jun 8
  • RES 1: $1877.7 - High Jun 14
  • PRICE: $1858.0 @ 07:13 GMT Nov 19
  • SUP 1: $1822.4 - Low Nov 10
  • SUP 2: $1804.3/1759.0 - 50-day EMA / Low Nov 3 and a key support
  • SUP 3: $1746.0 - Low Oct 6
  • SUP 4: $1721.7 - Low Sep 29 and the bear trigger

Gold continues to consolidate but remains bullish. Recent gains and a clear break of resistance at $1834.0, Sep 3 high reinforces current bullish conditions and paves the way for further strength near-term. Note too that gold has also breached $1863.3, 76.4% of the Jun - Aug sell-off. The focus is on $1877.7 next, Jun 14 high and $1903.8, Jun 8 high. Support is seen at $1822.4, Nov 10 low.

SILVER TECHS: Short-Term Bullish Conditions Intact

  • RES 4: $26.778 - High Jul 6
  • RES 3: $26.467 - High Jul 14
  • RES 2: $26.002 - High Aug 4 and a key resistance
  • RES 1: $25.406 - High Nov 16
  • PRICE: $24.862 @ 07:20 GMT Nov 19
  • SUP 1: $24.005/23.020 - 50-day EMA / Low Nov 3 and a key support
  • SUP 2: $22.213 - Low Oct 6
  • SUP 3: $21.423 - Low Sep 29 and key support
  • SUP 4: $20.871 - 50.0% retracement of the Mar '20 - Feb '21 rally

The Silver outlook remains bullish. Recent price action had defined key short-term directional triggers at; $23.020, Nov 3 low and $24.828, Oct 22 high. The $24.828 resistance has been cleared and this break confirms a resumption of the current bull cycle. The move opens $26.002 next, Aug 4 high. For bears, weakness through $23.020 is required to instead expose $22.213, Oct 6 low.

MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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