MNI DAILY TECHNICAL ANALYSIS - Corrective Bounce Underway, But EUR Trend Direction Remains Down

Price Signal Summary – Corrective Bounce Underway, But Trend Direction in EUR Remains Down

• S&P E-Minis are starting the week on a firmer note, extending Friday’s gains and the rebound from last Thursday's low of 3723.75. Short-term gains are considered corrective - for now. EUROSTOXX 50 futures are starting the week on a firmer note, extending Friday's gains and the recovery from last week’s 3362.00 low (Jul 14). Short-term gains are still considered corrective.
• The trend direction in EURUSD remains down. Support at parity and 0.9965, the base of the bear channel drawn from the Feb 10 high, were breached last Thursday. This strengthens the current bearish case and opens 0.9944, a Fibonacci projection. EURGBP conditions still appear bearish despite the recovery from last Wednesday’s low. The cross remains below the 50-day EMA and scope is seen for a deeper retracement with attention on support at 0.8393, the May 17 low. EURJPY remains above its recent lows. The cross still appears vulnerable but is holding onto its recent gains. The reversal from 144.28, Jun 28 high, still suggests scope for an extension lower.
• Gold remains in a downtrend and traded to a fresh trend low last week. This marks a continuation of the recent sell-off that has resulted in the break of a key S/T support and bear trigger at $1787.00, May 16 low. WTI futures traded lower last Thursday to confirm a resumption of the current downtrend. Price however has recovered from $90.56, the Jul 14 low. In pattern terms, last Thursday is a hammer candle formation - a potential short-term reversal signal.
• Bund futures continue to trade closer to recent highs and remain in an uptrend, following last week’s high print above 152.92, the Jul 6 high. This confirmed a resumption of the bull cycle. The short-term outlook in Gilt futures remains bullish despite Friday’s move lower. Dips are considered corrective. Recent gains confirmed a resumption of the bull cycle that started Jun 16 - price has cleared resistance at 114.55, the Jun 24 high.

FOREIGN EXCHANGE

EURUSD TECHS: Remains Vulnerable

• RES 4: 1.0503 Bull channel resistance drawn from the Feb 10 high
• RES 3: 1.0449 High Jul 5
• RES 2: 1.0270/0359 20-day EMA / Low Jun 15
• RES 1: 1.0122/0191 High Jul 13 / High Jul 8
• PRICE: 1.0089 @ 06:10 BST Jul 18
• SUP 1: 0.9944 1.618 projection of the Jun 9 - 15 - 27 price swing
• SUP 2: 0.9883 1.764 projection of the Jun 9 - 15 - 27 price swing
• SUP 3: 0.9863 Dec 2002 low
• SUP 4: 0.9785 2.00 projection of the Jun 9 - 15 - 27 price swing

The trend direction in EURUSD remains down. Support at parity and 0.9965, the base of the bear channel drawn from the Feb 10 high, were breached last Thursday. This strengthens the current bearish case and opens 0.9944, a Fibonacci projection. Clearance of this level would expose 0.9883. Initial resistance to watch is 1.0122, the Jul 13 high. A break would highlight the possibility of a short-term correction from the base of the bear channel.

GBPUSD TECHS: Trend Remains Down

• RES 4: 1.2332 High Jun 27
• RES 3: 1.2213 High Jun 29
• RES 2: 1.2049/56 20-day EMA / High Jul 8
• RES 1: 1.1967 High Jul 13
• PRICE: 1.1886 @ 06:15 BST Jul 18
• SUP 1: 1.1760 Low Jul 14
• 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 continues to trade closer to recent lows and remains bearish following last week’s extension lower. The move lower confirmed a resumption of the current downtrend and maintains the bearish price sequence of lower lows and lower highs. The focus is on 1.1673 next, a Fibonacci projection. Firm resistance is seen at 1.2049, the 20-day EMA. A break would signal scope for a short-term correction.

EURGBP TECHS: Support Remains Exposed

• RES 4: 0.8762 1.00 proj of the Apr 14 - May 12 - 17 price swing
• RES 3: 0.8721 High May 26 2021 and Jun 15 / bull trigger
• RES 2: 0.8627/79 High Jul 4 / High Jul 1
• RES 1: 0.8518 50-day EMA
• PRICE: 0.8491 @ 06:22 BST Jul 18
• SUP 1: 0.8403 Low Jul 13
• SUP 2: 0.8393 Low May 17 and a key support
• SUP 3: 0.8367 Low May 2
• SUP 4: 0.8313 Low Apr 22

EURGBP conditions still appear bearish despite the recovery from last Wednesday’s low. The cross remains below the 50-day EMA and scope is seen for a deeper retracement with attention on support at 0.8393, the May 17 low. A break of this level would strengthen a bearish case. On the upside, initial resistance is seen at 0.8518, the 50-day EMA. A clear breach of this average is required to signal a possible reversal.

USDJPY TECHS: Bull Cycle Still In Play

• RES 4: 141.47 1.382 proj of the Jun 16 - 22 - 23 price swing
• RES 3: 140.71 1.236 proj of the Jun 16 - 22 - 23 price swing
• RES 2: 140.00 Psychological round number
• RES 1: 139.48 1.00 proj of the Jun 16 - 22 - 23 price swing
• PRICE: 138.24 @ 06:32 BST Jul 18
• SUP 1: 137.28 Low Jul 14
• SUP 2: 136.14/134.27 20-day EMA / Low Jun 23
• SUP 3: 133.90 Bull channel base from the Mar 4 low
• SUP 4: 133.14 50-day EMA

USDJPY traded higher last week. This confirmed a resumption of the primary uptrend and maintains the bullish price sequence of higher highs and higher lows. Moving average studies are in bull mode condition and this clearly highlights current market sentiment. The focus is on 139.48, a Fibonacci projection ahead of the psychological 140.00 handle. On the downside, the 20-day EMA, at 136.14, marks initial firm support.

EURJPY TECHS: Holding Onto Recent Gains

• RES 4: 144.28 High Jun 28 and key resistance
• RES 3: 142.37 High Jul 5
• RES 2: 141.40 Low Jun 24
• RES 1: 139.78/89 20-day EMA / High Jul 15
• PRICE: 139.61 @ 06:50 BST Jul 18
• SUP 1: 137.99/36.87 Low Jul 14 / Low Jul 8
• SUP 2: 136.25 Low May 30
• SUP 3: 135.40 76.4% retracement of the May 12 - Jun 28 climb
• SUP 4: 134.68 3.0% 10-dma envelope

EURJPY remains above its recent lows. The cross still appears vulnerable but is holding onto its recent gains. The reversal from 144.28, Jun 28 high, still suggests scope for an extension lower. Price has recently traded through 137.85, Jun 16 low. A clear breach of this level would strengthen bearish conditions and open 136.25, May 30 low. For bulls, clearance of the 20-day EMA, at 139.78, would highlight a stronger bullish reversal from recent lows.

AUDUSD TECHS: Fresh Trend Low

• RES 4: 0.7069 High Jun 16
• RES 3: 0.6970 50-day EMA
• RES 2: 0.6874 High Jul 8
• RES 1: 0.6852 20-day EMA
• PRICE: 0.6806 @ 06:55 BST Jul 18
• SUP 1: 0.6682 Low Jul 14 and the bear trigger
• SUP 2: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing
• SUP 3: 0.6588 Low May 28 2020
• SUP 4: 0.6538 Low May 26 2020

AUDUSD traded to a fresh trend low of 00682 last week (Jul 14). The pair remains bearish and this recent weakness reinforces bearish conditions. Support at 0.6762, the Jul 5 / 6 low and 0.6759, 50.0% of the Mar ‘20 - Feb ‘21 bull cycle, have been breached. The break sets the scene for a move towards 0.6647 next, a Fibonacci projection. On the upside, initial firm resistance is seen at 0.6852, the 20-day EMA.

USDCAD TECHS: Pullback Considered Corrective

• RES 4: 1.3300 High Nov 4 2020
• RES 3: 1.3260 2.0% 10-dma envelope
• RES 2: 1.3224 High Jul 14
• RES 1: 1.3166 3.0% Upper Bollinger Band
• PRICE: 1.2997 @ 07:00 BST Jul 18
• SUP 1: 1.2936 Low Jul 8
• SUP 2: 1.2875 50-day EMA
• SUP 3: 1.2819 Low Jun 28 and key support
• SUP 4: 1.2763 Low Jun 13

USDCAD last week cleared a key resistance at 1.3084, the Jul 5 high. The break confirms a resumption of the primary uptrend, paving the way for gains towards a vol band based resistance of 1.3260 and the 1.3300 handle further out. Moving average studies remain in bull mode condition, reinforcing the current positive outlook. The latest pullback is considered corrective. Key support has been defined at 1.2936, the Jul 8 low.

FIXED INCOME

BUND TECHS: (U2) Bull Cycle Remains In Play

• RES 4: 155.01 1.236 projection of the Jun 16 - 24 - 28 price swing
• RES 3: 154.65 High May 27
• RES 2: 154.00 Round number
• RES 1: 153.48 High Jul 12 and the bull trigger
• PRICE: 153.16 @ 05:13 BST Jul 18
• SUP 1: 150.94/149.75 50-day EMA / Low Jul 11
• SUP 2: 148.24 Low Jul 1
• SUP 3: 146.50 Low Jun 30
• SUP 4: 144.72 Low Jun 28 and a key support

Bund futures continue to trade closer to recent highs and remain in an uptrend, following last week’s high print above 152.92, the Jul 6 high. This confirmed a resumption of the bull cycle. The break higher also maintains the bullish price sequence of higher highs and higher lows and attention is on the 154.00 handle next ahead of 154.65, the May 27 high. Key short-term support has been defined at 149.75, the July 11 low.

BOBL TECHS: (U2) Trend Needle Points North

• RES 4: 127.160 High May 12
• RES 3: 126.879 1.236 projection of the Jun 16 -24 - 28 price swing
• RES 2: 126.710 High May 26
• RES 1: 126.560 High Jul 6 and the bull trigger
• PRICE: 126.010 @ 05:20 BST Jul 18
• SUP 1: 124.648 20-day EMA
• SUP 2: 123.010 Low Jun 30
• SUP 3: 121.910 Low Jun 28 and a key near-term support
• SUP 4: 120.990 Low Jun 21

A bull cycle in Bobl futures still appears to be in play and attention is on resistance at 126.560, the Jul 6 high and the next bull trigger. The recent breach of 123.960, the Jun 24 high, confirmed a resumption of the current uptrend and price has established a positive sequence of higher highs and higher lows. Scope is seen for a climb towards 126.710, the May 26 high. Key short-term support has been defined at 121.190, Jun 28 low.

SCHATZ TECHS: (U2) Bullish Outlook

• RES 4: 110.412 1.382 proj of the May 16 - 24 - 28 price swing
• RES 3: 110.256 1.382 proj of the May 16 - 24 - 28 price swing
• RES 2: 110.063 1.236 proj of the May 16 - 24 - 28 price swing
• RES 1: 110.005 High Jul 6 and the bull trigger
• PRICE: 109.715 @ 05:27 BST Jul 18
• SUP 1: 109.270 Low Jul 14
• SUP 2: 108.760/425 Low Jun 30 / Low Jun 28 and a key support
• SUP 3: 108.025 Low Jun 21
• SUP 4: 107.705 Low Jun 16 and the bear trigger

Schatz futures are unchanged and remain below recent highs. The short-term trend needle still points north. The contract has recently cleared 109.030, the Jun 24 high. This marked an extension of a corrective cycle and price has established a bullish sequence of higher highs and higher lows. Scope is seen for a climb towards 110.063, a Fibonacci projection. Key short-term support has been defined at 108.425, Jun 28 low.

GILT TECHS: (U2) Resistance Remains Exposed

• RES 4: 118.63 High May 24
• RES 3: 118.16 1.382 proj of the Jun 16 - 24- 29 price swing
• RES 2: 117.48 1.236 proj of the Jun 16 - 24- 29 price swing
• RES 1: 117.09 High Jul 6 and the bull trigger
• PRICE: 115.64 @ Close Jul 15
• SUP 1: 114.08/113.03 Low Jul 8 / Low Jun 30
• SUP 2: 111.72 Low Jun 29 and key near-term support
• SUP 3: 110.57 Low Jun 21
• SUP 4: 109.89 Low Jun 16 and the bear trigger

The short-term outlook in Gilt futures remains bullish despite Friday’s move lower. Dips are considered corrective. Recent gains confirmed a resumption of the bull cycle that started Jun 16 - price has cleared resistance at 114.55, the Jun 24 high. A resumption of strength would open 117.48 next, a Fibonacci projection. On the downside, key short-term support has been defined at 111.72, the Jun 29 low. Initial support to watch is 114.08, Jul 8 low.

BTP TECHS: (U2) Conditions Remain Bullish

• RES 4: 130.00 Round number resistance
• RES 3: 129.00 High May 12
• RES 2: 127.79 High May 26
• RES 1: 126.41 High Jul 1 and the bull trigger
• PRICE: 123.85 @ Close Jul 15
• SUP 1: 121.96 Low Jul 14
• SUP 2: 119.81 Low Jun 28 and key S/T support
• SUP 3: 118.60 Low Jun 22
• SUP 4: 115.72 Low Jun 16

BTP futures traded lower last Thursday but did find support at the session low and price remains inside its recent range. The current consolidation appears to be a bull flag formation and the short-term trend condition is bullish, reinforced by the recent breach of 122.80, the Jun 24 high. The break suggests potential for a stronger correction and attention is on 127.79, the May 26 high. Initial key support to watch is 119.81, Jun 28 low.

EQUITIES

EUROSTOXX50 TECHS: (U2) Approaching First Resistance

• RES 4: 3774.00 High Jun 9
• RES 3: 3689.00 High Jun 10
• RES 2: 3584.00 High Jun 27 and a key resistance
• RES 1: 3504.00/3555.80 High Jul 8 / 50-day EMA
• PRICE: 3490.00 @ 05:32 BST Jul 18
• SUP 1: 3343.00 Low Jul 5 and the bear trigger
• SUP 2: 3321.30 50.0% retracement the major 2020 - 2021 upleg
• SUP 3: 3300.00 Round number support
• SUP 4: 3241.70 1.382 proj of the Mar 29 - May 10 - Jun 6 price swing

EUROSTOXX 50 futures are starting the week on a firmer note, extending Friday's gains and the recovery from last week’s 3362.00 low (Jul 14). Short-term gains are still considered corrective. The recent breach of 3384.00, Jun 16 low, reinforced bearish conditions and has opened 3321.30, a Fibonacci retracement. Initial resistance to watch is at 3504.00, Jul 8 high. A break would signal scope for a stronger corrective bounce.

E-MINI S&P (U2): Starting The Week On A Firmer Note

• RES 4: 4308.50 High Apr 28
• RES 3: 4204.75 High May 31 and a key resistance
• RES 2: 3956.84 50-day EMA
• RES 1: 3950.00 High Jun 27
• PRICE: 3885.75 @ 06:56 BST Jul 18
• SUP 1: 3723.75/3639.00 Low Jul 14 / Low Jun 17 and a bear trigger
• SUP 2: 3578.27 0.618 proj of the Mar 29 - May 20 - 31 price swing
• SUP 3: 3500.00 Round number support
• SUP 4: 3384.75 0.764 proj of the Mar 29 - May 20 - 31 price swing

S&P E-Minis are starting the week on a firmer note, extending Friday’s gains and the rebound from last Thursday's low of 3723.75. Short-term gains are considered corrective - for now. Resistance to watch is at 3950.00, the Jun 27 high and the 50-day EMA, at 3956.84. A clear breach of this zone would strengthen a bullish case. On the downside, a resumption of weakness and a break of 3923.75 low, would open key support at 3639.00, Jun 17 low.

COMMODITIES

BRENT TECHS: (U2) Doji Reversal Signal Still In Play

• RES 4: $118.12 - High Jun 17
• RES 3: $116.24 - High Jun 29 and a key resistance
• RES 2: $107.60/114.75 - 50-day EMA / High Jul 5
• RES 1: $103.00 - Intraday high
• PRICE: $102.30 @ 07:05 BST Jul 18
• SUP 1: $98.17/94.15 - Low Jul 15 / Low Jul 14
• SUP 2: $90.33 - Low Mar 17
• SUP 3: $89.60 - Low Mar 15 and a key support
• SUP 4: $86.74 - Low Feb 25

Brent futures traded lower last week to confirm a resumption of the current downtrend. Price however has recovered from last week’s low and the price pattern on Jul 14 is a long legged doji candle pattern. This pattern highlights the possibility of a short-term corrective reversal. Stronger gains would open the $105.00 handle. A resumption of weakness and a break of $94.15, Jul 14 lwo, would resume the downtrend.

WTI TECHS: (Q2) Hammer Reversal

• RES 4: $116.58 - High Jun 17
• RES 3: $114.05 - High Jun 29 and a key near-term resistance
• RES 2: $105.34/111.45 - 50-day EMA / High Jul 5
• RES 1: $99.20 - Intraday high
• PRICE: $98.67 @ 07:15 BST Jul 18
• SUP 1: $94.57/90.56 - Low Jul 15 / Low Jul 14
• SUP 2: $90.13 - 1.236 projection of the Jun 14 - 22 - 29 price swing
• SUP 3: $86.81 - Low Mar 15
• SUP 4: $85.03 - 1.50 projection of the Jun 14 - 22 - 29 price swing

WTI futures traded lower last Thursday to confirm a resumption of the current downtrend. Price however has recovered from $90.56, the Jul 14 low. In pattern terms, last Thursday is a hammer candle formation - a potential short-term reversal signal. A stronger corrective bounce would open the $100.00 handle and above. On the downside, a resumption of weakness and a break of $90.56, would resume the downtrend.

GOLD TECHS: Heading South

• RES 4: $1836.9 - Trendline resistance drawn from the Mar 8 high
• RES 3: $1813.7 - 50-day EMA
• RES 2: $1787.0 - Low May 16, recent breakout level
• RES 1: $1745.4/69.7 - High Jul 13 / 20-day EMA
• PRICE: $1714.2 @ 07:19 BST Jul 18
• SUP 1: $1697.7 - Low Jul 14
• SUP 2: $1690.6 - Low Aug 9 2021
• SUP 3: $1680.5 - 1.764 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 4: $1676.9 - Low Mar 8 2021

Gold remains in a downtrend and traded to a fresh trend low last week. This marks a continuation of the recent sell-off that has resulted in the break of a key S/T support and bear trigger at $1787.00, May 16 low. The break marks a resumption of the broader downtrend. The focus is on $1690.6 next, the Aug 9 2021 low. Moving average studies are in a bear mode condition, highlighting current bearish sentiment. Initial firm resistance is at $1769.7.

SILVER TECHS: Southbound

• RES 4: $21.967 - High Jun 17
• RES 3: $21.018 - 50-day EMA
• RES 2: $20.464 - Low May 13 and recent breakout level
• RES 1: $19.840 - 20-day EMA
• PRICE: $18. 844 @ 08:01 BST Jul 18
• SUP 1: $18.146/18.000 - Low Jul 14 / Round number support
• SUP 2: $17.312 - 3.00 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 3: $16.955 - Low Jun 15 2020
• SUP 4: $16.735 - Low May 22 2020

The Silver outlook remains bearish following a resumption of the downtrend last week. This marks a continuation of the current bear cycle that started Jun 6 and an extension of the broader downtrend that has been in place since early February 2021. Moving average studies remain in a bear mode condition highlighting current sentiment. Sights are on $18.693 next, a Fibonacci retracement. The 20-day EMA, at $19.840, is a key S/T resistance.