MNI DAILY TECHNICAL ANALYSIS - Bunds Resume Uptrend

Price Signal Summary - Bunds Resume Uptrend

• In the equity space, S&P E-minis cleared the key 50-day EMA on Dec 1 and Friday attempted a resumption of the current downtrend. An ability to remain below the 50-day EMA would strengthen bearish conditions. EUROSTOXX 50 futures are consolidating and last week traded in a choppy manner. Trend conditions are bearish following the recent sharp sell-off that resulted in a breach of the 50-day EMA.
• In FX, EURUSD remains below recent highs. Price gains early last week resulted in a test of the 20-day EMA, at 1.1356 today, plus a print above 1.1374, the Nov 18 high. GBPUSD drifted lower Friday and remains weak. The trend condition is bearish and 1.3195, Nov 30 low, represents an important short-term support and bear trigger given the volatile nature of price action early last week. USDJPY is consolidating near recent lows and the short-term outlook remains bearish. The move lower on Nov 30 resulted in a print below 112.73, Nov 9 low. A clear break of this support would resume the current bear cycle
• On the commodity front, Gold remains above last week’s lows. Short-term conditions though remain bearish, having recently pulled back from $1877.2, the Nov 16 high. Price has breached both the 20- and the 50-day EMAs and attention remains on the base of a bull channel at $1762.1. Thursday’s rebound in WTI from the session low has defined $62.43 as a key short-term support. The rebound highlights potential for a near-term recovery that would allow a recent oversold condition to unwind.
• In the FI space, Bund futures traded to a fresh trend high once again Friday confirming a resumption of the uptrend that has been in place since Oct 29 and maintaining the bullish price sequence of higher highs and higher lows. Gilt futures maintain a bullish tone and the contract traded higher again on Friday. Continued gains reinforce a positive theme and maintain a bullish price sequence of higher highs and higher lows.

FOREIGN EXCHANGE

EURUSD TECHS: Remains Below Recent Highs

• RES 4: 1.1692 High Oct 28
• RES 3: 1.1579 Bear channel top from Jun 1 high
• RES 2: 1.1514 Low Nov 5
• RES 1: 1.1383/1.1464 High Nov 30 / High Nov 15
• PRICE: 1.1285 @ 06:13 GMT Dec 4
• SUP 1: 1.1236 Low Nov 30
• SUP 2: 1.1186/85 Low Nov 24 / Low Jul 1, 2020
• SUP 3: 1.1128 1.764 proj of the Jan 6 - Mar 31 - May 25 price swing
• SUP 4: 1.1040 76.4% retracement of the Mar ‘20 - Jan ‘21 uptrend

EURUSD remains below recent highs. Price gains early last week resulted in a test of the 20-day EMA, at 1.1356 today, plus a print above 1.1374, the Nov 18 high. This does suggest scope for an extension of the corrective cycle and a clear break higher would open 1.1514, Nov 5 high. The broader trend remains bearish though with the bear trigger at 1.1186/85. Moving average studies are still in bear mode.

GBPUSD TECHS: Remains Weak

• RES 4: 1.3698 High Nov 4
• RES 3: 1.3607 High Nov 9
• RES 2: 1.3514 High Nov 18 and a key resistance
• RES 1: 1.3370/3391 High Nov 30 / 20-day EMA
• PRICE: 1.3233 @ 06:18 GMT Dec 6
• SUP 1: 1.3195 Low Nov 30 and the bear trigger
• SUP 2: 1.3188 Low Dec 21 2020
• SUP 3: 1.3165 38.2% Mar ‘20 - Jun ‘21 Upleg
• SUP 4: 1.3053 2.0% 10-dma envelope

GBPUSD drifted lower Friday and remains weak. The trend condition is bearish and 1.3195, Nov 30 low, represents an important short-term support and bear trigger given the volatile nature of price action early last week. A break lower would resume the downtrend and pave the way for weakness towards 1.3165, a retracement level. A stronger short-term recovery however would expose the 20-day EMA at 1.3391.

EURGBP TECHS: Corrective Recovery Extends

• RES 4: 0.8624 High Oct 1
• RES 3: 0.8595 High Nov 5 and a key resistance
• RES 2: 0.8574 High Nov 11
• RES 1: 0.8559 Intraday high
• PRICE: 0.8528 @ 06:27 GMT Dec 6
• SUP 1: 0.8480 20-day EMA
• SUP 2: 0.8446 Low Nov 29
• SUP 3: 0.8411/8381 Low Nov 26 / Low Nov 22
• SUP 4: 0.8356 Low Feb 26, 2020

EURGBP maintains a fimer short-term tone. The cross traded higher Friday and has today tested levels above 0.8550. The cross has also breached 0.8544, 76.4 retracement of the Nov 5 - 22 sell-off and this suggests potential for an extension towards a key short-term resistance at 0.8595, the Nov 5 high. Recent gains are still considered corrective however with broader trend signals remaining bearish. First support to watch is 0.8480.

USDJPY TECHS: Remains Vulnerable

• RES 4: 116.87 High Jan 11, 2017
• RES 3: 116.09 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 2: 115.52 High Nov 24 and the bull trigger
• RES 1: 113.74 20-day EMA
• PRICE: 113.03 @ 06:31 GMT Dec 6
• SUP 1: 112.53 Low Nov 30
• SUP 2: 112.08 High Sep 30 and a recent breakout level
• SUP 3: 111.32 61.8% retracement of the Aug - Nov rally
• SUP 4: 110.82 Low Oct 4

USDJPY is consolidating near recent lows and the short-term outlook remains bearish. The move lower on Nov 30 resulted in a print below 112.73, Nov 9 low. A clear break of this support would resume the current bear cycle and open 112.08 next, Sep 30 high. Initial resistance is seen at 113.74, the 20-day EMA. A breach would ease bearish concerns and signal a possible S/T base. Key resistance though is unchanged at 115.52, the Nov 24 high.

EURJPY TECHS: Trend Signals Still Point South

• RES 4: 131.59 High Nov 5
• RES 3: 130.02 50-day EMA
• RES 2: 129.99 High Nov 19
• RES 1: 128.79/129.60 High Dec 1 / High Nov 23 and key resistance
• PRICE: 127.53 @ 06:36 GMT Dec 6
• SUP 1: 127.39 Low Dec 3 and intraday low
• SUP 2: 127.28 1.00 proj of the Jun 1 - Sep 22 - Oct 20 price swing
• SUP 3: 127.04/126.65 Low Feb 15 / Low Feb 10
• SUP 4: 125.82 1.236 proj of the Jun1 - Sep 22 - Oct 20 price swing

EURJPY remains bearish and the cross continues to deliver lower lows. A bearish theme follows the recent breach of 127.93, Sep 22 low and an important support. The break opens 127.04, Feb 15 low and note that MA studies still point south suggesting potential for a deeper decline further out. Key S/T resistance has been defined at 129.60, Nov 23 high.

AUDUSD TECHS: Downtrend Accelerates

• RES 4: 0.7371 High Nov 15
• RES 3: 0.7209/7275 20-day EMA / Former channel base
• RES 2: 0.7173/7198 High Dec 1 / High Nov 26
• RES 1: 0.7099 High Dec 3
• PRICE: 0.7017 @ 06:47 GMT Dec 6
• SUP 1: 0.6991 Low Nov 2 2020
• SUP 2: 0.6963 Low Jul 16 2020
• SUP 3: 0.6921 Low Jul 14 2020
• SUP 4: 0.6759 50% 2020 - 2021 Rally

AUDUSD came under considerable pressure Friday and closed near session lows. The sharp sell-off reinforces bearish conditions and has exposed support at 0.6991, the Nov 2 2020 low and an important support handle. Weakness through here would accelerate the current solid bearish theme, opening 0.6759 - the 50% retracement of the 2020-2021 range - as the medium-term target. Initial resistance is at Friday’s 0.7099 high.

USDCAD TECHS: Bull Theme Remains Intact

• RES 4: 1.3002 2.0% 10-dma envelope
• RES 3: 1.2949 High Aug 20 and a key resistance
• RES 2: 1.2896 High Sep 20
• RES 1: 1.2854 High Dec 3
• PRICE: 1.2829 @ 06:52 GMT Dec 6
• SUP 1: 1.2714 Low Dec 1
• SUP 2: 1.2641 Low Nov 25 Low Nov 1
• SUP 3: 1.2580 50-day EMA
• SUP 4: 1.2493 Low Nov 16

USDCAD continues to climb and short-term conditions remain bullish. The recent break of 1.2753, 76.4% of the Sep 20 - Oct 21 sell-off and 1.2775, Sep 29 high strengthened the current bullish set-up and signals scope for a climb towards 1.2896 next, Sep 20 high. On the downside, a key short-term support has been defined at 1.2641, Nov 25 low. A break of this level would threaten the current trend.

FIXED INCOME

BUND TECHS: (H2) Heading North

• RES 4: 175.57 1.618 proj of the Nov 11 - 22 - 24 price swing
• RES 3: 175.29 1.50 proj of the Nov 11 - 22 - 24 price swing
• RES 2: 175.02 1.382 proj of the Nov 11 - 22 - 24 price swing
• RES 1: 174.89 High Dec 3
• PRICE: 174.49 @ 05:22 GMT Dec 6
• SUP 1: 173.31 Low Dec 2
• SUP 2: 172.70 Low Nov 26
• SUP 3: 171.77 Low Nov 24 and key near-term support
• SUP 4: 170.72 Low Nov 4

Bund futures traded to a fresh trend high once again Friday confirming a resumption of the uptrend that has been in place since Oct 29 and maintaining the bullish price sequence of higher highs and higher lows. Key support is at 171.77, Nov 24 low. The focus is on the 175.00 handle next. Initial support is seen at 173.31, Dec 1 low. A break is required to signal a potential top.

BOBL TECHS: (H2) Consolidating Near Recent Highs

• RES 4: 135.126 1.382 pro of the Nov 11 - 22 - 23 price swing
• RES 3: 134.978 1.236 pro of the Nov 11 - 22 - 23 price swing
• RES 2: 134.740 1.00 pro of the Nov 11 - 22 - 23 price swing
• RES 1: 134.530 High Nov 30 and the bull trigger
• PRICE: 134.270 @ 05:27 GMT Dec 6
• SUP 1: 133.920 Low Dec 1
• SUP 2: 133.730 Low Nov 23 and key near-term support
• SUP 3: 133.610 Low Nov 16
• SUP 4: 133.410 Low Nov 11

Bobl futures trend conditions remain bullish with the contract consolidating near recent highs. A bullish theme follows the break on Nov 19 of 134.000, Nov 15 high that confirmed a resumption of the recovery since Oct 29 and established a bullish price sequence of higher highs and higher lows. The focus is on a climb towards 134.740 next, a Fibonacci projection. Key short-term support has been defined at 133.730, Nov 23 low.

SCHATZ TECHS: (H2) Pullback Considered Corrective

• RES 4: 112.375 1.382 proj of the Nov 16 - 26 - Dec 1 price swing
• RES 3: 112.350 1.236 proj of the Nov 16 - 26 - Dec 1 price swing
• RES 2: 112.305 High Nov 26 and the bull trigger
• RES 1: 112.235 High Dec 2 / 3
• PRICE: 112.190 @ 05:38 GMT Dec 6
• SUP 1: 112.140 Low Dec 1
• SUP 2: 112.140 Low Nov 11
• SUP 3: 112.100 Round number support
• SUP 4: 112.031 1.236 proj of the Nov 26 - Dec 1 - Dec 3 price swing

Schatz futures outlook remains bullish despite last week’s pullback, a likely correction. The contract recently probed resistance at 112.300, Nov 22 high. A clear breach would confirm a resumption of the short-term uptrend that started late October and open 112.350, a Fibonacci projection. On the downside, initial support lies at 112.140, Dec 1 low. Clearance of this support would alter the short-term outlook.

GILT TECHS: (H2) Extends Gains

• RES 4: 128.00 High Aug 31
• RES 3: 127.69 High Sep 3
• RES 2: 127.36 High Sep 7
• RES 1: 127.19 High Dec 3
• PRICE: 126.87 @ Close GMT Dec 3
• SUP 1: 125.44 Low Nov 26 and gap high
• SUP 2: 124.94 High Nov 25 and gap low
• SUP 3: 124.48 Low Nov 25
• SUP 4: 124.17 Low Nov 24 and key support

Gilt futures maintain a bullish tone and the contract traded higher again on Friday. Continued gains reinforce a positive theme and maintain a bullish price sequence of higher highs and higher lows. The 127.00 objective has been achieved and the focus turns to 127.36, the Sep 7 high and the 128.00 handle further out. On the downside, key short-term support has been defined at 124.17, Nov 24 low. Initial firm support is at 125.44.

BTP TECHS: (H2) Approaching The Bull Trigger

• RES 4: 151.45 0.764 proj of the Nov 1 - 22 - 24 price swing
• RES 3: 151.00 Round number resistance
• RES 2: 150.64 High Nov 22 and the bull trigger
• RES 1: 150.36 High Dec 3
• PRICE: 149.85 @ Close GMT Dec 3
• SUP 1: 148.25 Low Dec 1
• SUP 2: 147.36 Low Nov 24 and key support
• SUP 3: 146.55 76.4% retracement of the Nov 1 - 22 rally
• SUP 4: 145.29 Low Nov 1 and the bear trigger

BTP futures traded down to a low of 147.36 on Nov 24. This move resulted in a break of support at 148.70, Nov 12 low that undermines the recent bull theme. A deeper sell-off would open 146.55, a Fibonacci retracement level and potentially lower. However, the contract has also recovered from 147.36 and traded higher again Friday. Key short-term resistance and the bull trigger is at 150.64, Nov 229 high. A break would reinstate a bullish theme.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Bearish Risk Remains Present

• RES 4: 4420.80 1.382 proj of the Jul 19 - Sep 6 - Oct 6 price swing
• RES 3: 4409.50 High Nov 18 and the bull trigger
• RES 2: 4304.50 Nov 24 high and a key short-term resistance
• RES 1: 4186.00/4209.10 High Dec 1 / 50-day EMA
• PRICE: 4115.50 @ 05:59 GMT Dec 6
• SUP 1: 3995.00 Low Nov 30
• SUP 2: 3949.50 Low Oct 6 and bear trigger
• SUP 3: 3882.00 Low Jul 19
• SUP 4: 3844.00 Low May 13 (cont)

EUROSTOXX 50 futures are consolidating and last week traded in a choppy manner. Trend conditions are bearish following the recent sharp sell-off that resulted in a breach of the 50-day EMA. A resumption of weakness would open 3949.50 Oct 6 low. This is an important support and a break would strengthen bearish conditions. On the upside, a move above 4304.50, Nov 24 high is required to ease bearish pressure. Initial resistance is at 4186.00.

E-MINI S&P (Z1): Bearish Focus

• RES 4: 4783.40 1.764 proj of Jul 19 - Aug 16 - 19 price swing
• RES 1: 4740.50/46.68 High Nov 22 / 1.618 of Jul 19-Aug 16-19 swing
• RES 2: 4669.75/4717.00 High Nov 29 / High Nov 26
• RES 1: 4612.20 20-day EMA
• PRICE: 4559.00 @ 07:05 GMT Dec 6
• SUP 1: 4492.00 Low Dec 3
• SUP 2: 4443.55 61.8% retracement of the Oct 1 - Nov 22 rally
• SUP 3: 4373.40 76.4% retracement of the Oct 1 - Nov 22 rally
• SUP 4: 4317.25/4260.00 Low Oct 12 / Low Oct 1 and the bear trigger

S&P E-minis cleared the key 50-day EMA on Dec 1 and Friday attempted a resumption of the current downtrend. An ability to remain below the 50-day EMA would strengthen bearish conditions and looking ahead, a bearish cross of the 20-day EMA below the 50-day EMA (still a long way off) would reinforce bearish conditions. A resumption of weakness would open 4443.55 next, a retracement level. Initial firm resistance is at 4669.75.

COMMODITIES

BRENT TECHS: (G2) Remains Above Last Week’s Low

• RES 4: $84.66 - High Oct 26 and the bull trigger
• RES 3: $81.88 - High Nov 24
• RES 2: $77.52 - 50-day EMA
• RES 1: $74.35/76.82 - High Nov 30 / Low Nov 22
• PRICE: $71.57 @ 06:57 GMT Dec 6
• SUP 1: $65.72 - Low Dec 2
• SUP 2: $62.95 - Low Aug 23 and a key support
• SUP 3: $62.54 - Low May 21
• SUP 4: $61.39 - Low Apr 21

Brent futures remain vulnerable. However Thursday’s sharp rebound from the session low highlights $65.72 as a key short-term support. The rebound suggests there is potential for a short-term recovery that would allow an oversold condition to unwind. The next firm resistance is at $74.35, Nov 30 high. On the downside a break below $65.72 would confirm a resumption of the downtrend and open $62.95.

WTI TECHS: (F2) Corrective Bounce

• RES 4: $79.23/80.68 - High Nov 24 / Low Nov 4 / High Nov 16
• RES 3: $75.23 - 50-day EMA
• RES 2: $72.93/74.76 - High Nov 29 / Low Nov 22
• RES 1: $71.22 - High Nov 30
• PRICE: $67.81 @ 07:05 GMT Dec 6
• SUP 1: $62.43 - Low Dec 2
• SUP 2: $60.77 - Low Aug 23 and a key support
• SUP 3: $59.63 - Low May 20
• SUP 4: $58.31 - low Apr 21

Thursday’s rebound in WTI from the session low has defined $62.43 as a key short-term support. The rebound highlights potential for a near-term recovery that would allow a recent oversold condition to unwind. The next firm resistance is at $71.22, Nov 30 high. On the downside a break of $62.43 would confirm a resumption of the downtrend, exposing $60.77, the Aug 23 low and a key support.

GOLD TECHS: Attention Is On The Bull Channel Base

• RES 4: $1909.7 - High Jun 3
• RES 3: $1903.8 - High Jun 8
• RES 2: $1877.2/88.7 High Nov 16 / Bull channel top
• RES 1: $1815.6/49.1 - High Nov 26 / High Nov 22
• PRICE: $1783.5 @ 07:11 GMT Dec 6
• SUP 1: $1762.1 - Bull Channel base drawn from the Aug 9 low
• SUP 2: $1759.0 - Low Nov 3 and a key support
• SUP 3: $1721.7 - Low Sep 29 and a key support
• SUP 4: $1690.6 - Low Aug 9

Gold remains above last week’s lows. Short-term conditions though remain bearish, having recently pulled back from $1877.2, the Nov 16 high. Price has breached both the 20- and the 50-day EMAs and attention remains on the base of a bull channel at $1762.1. The channel is drawn off the Aug 9 low and represents an important support. A breakout would strengthen bearish conditions. Initial firm resistance is at $1815.6, the Nov 26 high.

SILVER TECHS: Trend Conditions Remain Bearish

• RES 4: $26.467 - High Jul 14
• RES 3: $26.002 - High Aug 4 and a key resistance
• RES 2: $25.406 - High Nov 16
• RES 1: $23.030/772 - High Dec 1 / High Nov 24
• PRICE: $22.482 @ 07:20 GMT Dec 6
• SUP 1: $21.995 - Low Oct 1
• SUP 2: $21.423 - Low Sep 29 and key support
• SUP 3: $20.871 - 50.0% retracement of the Mar ‘20 - Feb ‘21 rally
• SUP 4: $20.000 - Psychological round number

The Silver outlook remains bearish. The metal last week breached support at $23.020, Nov 23 low and has recently cleared the 50-day EMA. The break lower suggests scope for a deeper short-term pullback with the focus on $21.995 next, Oct 1 low. A break would expose the major support at $21.423, Sep 29 low. For bulls, a firm short-term resistance is seen at $23.772, the Nov 24 high.