MNI DAILY TECHNICAL ANALYSIS - Corrective Pullback for Equities

Price Signal Summary – Corrective Pullback for Equities

• S&P E-minis traded lower Tuesday and the contract breached the 20-day EMA. The move lower appears to be a correction. Trend conditions remain bullish with moving average studies still in a bull-mode set-up. A key short-term support in Eurostoxx 50 futures at 4285.90 has been breached - the 20-day EMA. The recent move down is considered corrective for now. A continuation lower would signal scope for a deeper corrective pullback towards 4216.60.
• The trend outlook in GBPUSD is unchanged and remains bullish. Last Friday’s gains reinforced this theme - the pair traded higher to breach resistance at 1.2546, the Apr 14 high and bull trigger. This also confirmed a resumption of the uptrend and has opened 1.2599, the Jun 7 2022 high. USDJPY rallied sharply higher last Friday and Monday’s gains highlight a bullish start to the week. The pullback from Tuesday’s high is considered corrective - for now. Friday’s rally resulted in a break of 135.13, Apr 19 high, to confirm a resumption of the trend that started Mar 24. AUDUSD traded higher Tuesday and briefly tested levels just above the 50-day EMA, at 0.6709. A clear breach of this EMA is required to suggest scope for a stronger bounce and open 0.6772, the Apr 20 high. On the downside, the key support to watch lies at 0.6565, the Mar 10 low.
• Gold traded higher Tuesday. For now, the yellow metal remains in a short-term bearish corrective cycle. Price has recently pierced support at $1990.5, the 20-day EMA, highlighting potential for a deeper retracement. A move lower would open $1955.2, the 50-day EMA. WTI futures remain in a downtrend and yesterday’s sharp sell-off reinforces this theme. The contract has cleared a number of retracement levels and this signals scope for weakness towards the $70.00 handle next and $69.02, the 76.4% retracement of the Mar 20 - Apr 12 rally.
• Bund futures rallied Tuesday and cleared short-term resistance at 135.74, the Apr 26 high. The break higher reinforces short-term bullish conditions and signals scope for an extension. The focus is on 136.70, a Fibonacci retracement. Gilt futures traded higher Tuesday. Attention is on resistance at the 20-day EMA which intersects at 101.97. The average has been pierced and a clear break would strengthen bullish conditions.

FOREIGN EXCHANGE

EURUSD TECHS: Finds Support Below The 20-Day EMA

• RES 4: 1.1225 1.236 projection of the Mar 15 - 23 - 24 price swing
• RES 3: 1.1185 High Mar 31 2022
• RES 2: 1.1127 1.00 projection of the Mar 15 - 23 - 24 price swing
• RES 1: 1.1045/1095 High Apr 28 / 26 and key resistance
• PRICE: 1.1024 @ 05:38 BST May 3
• SUP 1: 1.0942 Low May 2
• SUP 2: 1.0909 Low Apr 17
• SUP 3: 1.0864/31 50-day EMA / Low Apr 10
• SUP 4: 1.0788 Low Apr 3

EURUSD remains in an uptrend and has found support just below the 20-day EMA. Last week’s fresh cycle high reinforces a bullish theme. The focus is on 1.1127, a Fibonacci projection. Note that moving average studies are in a bull-mode condition highlighting bullish sentiment. Key short-term support has been defined at 1.0942, Tuesday’s low. A clear break of it would signal scope for a deeper correction, potentially towards 1.0864, the 50-day EMA.

GBPUSD TECHS: Trend Needle Still Points North

• RES 4: 1.2720 2.0% 10-dma envelope
• RES 3: 1.2667 High May 27 2022
• RES 2: 1.2599 High Jun 7 2022
• RES 1: 1.2584 High Apr 28 and May 1
• PRICE: 1.2488@ 06:33 BST May 3
• SUP 1: 1.2438 20-day EMA
• SUP 2: 1.2353/45 Low Apr 17 / 10
• SUP 3: 1.2329 50-day EMA
• SUP 4: 1.2275 Low Apr 3

The trend outlook in GBPUSD is unchanged and remains bullish. Last Friday’s gains reinforced this theme - the pair traded higher to breach resistance at 1.2546, the Apr 14 high and bull trigger. This also confirmed a resumption of the uptrend and has opened 1.2599, the Jun 7 2022 high. Support to watch is at the 20-day EMA, at 1.2438. A clear break of it is required to suggest scope for a deeper correction.

EURGBP TECHS: Bearish Threat Still Present Despite This Week’s Bounce

• RES 4: 0.8918 76.4% retracement of the Feb 3 - Mar 15 bear leg
• RES 3: 0.8880 61.8 retracement of the Feb 3 - Mar 15 bear leg
• RES 2: 0.8875 High Apr 25 and key short-term resistance
• RES 1: 0.8839 High Apr 28
• PRICE: 0.8824 @ 06:57 BST May 3
• SUP 1: 0.8760 Low May 1
• SUP 2: 0.8729 Low Apr 4
• SUP 3: 0.8719 Low Mar 15 and key support
• SUP 4: 0.8691 Low Dec 19

EURGBP traded higher Tuesday and the cross remains above its recent lows. Last Friday’s sell-off continues to highlight a bearish threat. The cross cleared support at 0.8792, the Apr 19 low and a resumption of weakness would pave the way for a test of support at 0.8719, the Mar 15 low and a key level. On the upside, key short-term resistance has been defined at 0.8875, the Apr 25 high. A break of this hurdle would reinstate a bullish theme.

USDJPY TECHS: Pullback Considered Corrective

• RES 4: 139.89 High Nov 30 2022
• RES 3: 139.59 50.0% retracement of the Oct - Jan bear cycle
• RES 2: 138.17 High Dec 15
• RES 1: 137.91 High Mar 8 and key resistance
• PRICE: 135.95 @ 07:02 BST May 3
• SUP 1: 135.13 High Apr 19 and a recent breakout level
• SUP 2: 134.40/133.81 20- and 50-day EMA values
• SUP 3: 133.02 Low Apr 26 and a key near-term support
• SUP 4: 132.02 Low Apr 13

USDJPY rallied sharply higher last Friday and Monday’s gains highlight a bullish start to the week. The pullback from Tuesday’s high is considered corrective - for now. Friday’s rally resulted in a break of 135.13, Apr 19 high, to confirm a resumption of the trend that started Mar 24. This paves the way for a test of 137.91, the Mar 8 high and a key resistance. Initial firm support is seen at 135.13, the Apr 19 high.

EURJPY TECHS: Bullish Outlook Despite Pullback

• RES 4: 153.62 1.618 proj of the Mar 20 - 21 - Apr 6 price swing
• RES 3: 152.81 1.50 proj of the Mar 20 - 21 - Apr 6 price swing
• RES 2: 152.00 1.382 proj of the Mar 20 - 21 - Apr 6 price swing
• RES 1: 151.61 High May 2
• PRICE: 149.97 @ 07:21 BST May 3
• SUP 1: 149.80 Intraday low
• SUP 2: 148.62 High Apr 25 and a recent breakout level
• SUP 3: 147.32 20-day EMA
• SUP 4: 146.29 Low Apr 25 and a key short-term support

EURJPY faded off the week’s best levels Tuesday, although recent price action remains constructive after resuming the current uptrend. 151.00 has been cleared, the 1.236 projection of the Mar 20 - 21 - Apr 6 price swing and this opens 152.00 next, the 1.382 projection. Key short-term support has been defined at 146.29, the Apr 25 low, where a break is required to signal a short-term reversal. Initial firm support lies at 148.62, the Apr 25 high.

AUDUSD TECHS: Briefly Tops The 50-Day EMA

• RES 4: 0.6861 50.0% retracement of the Feb 2 - Mar 10 bear leg
• RES 3: 0.6824 High Feb 24
• RES 2: 0.6772/0.6806 High Apr 20 / Apr 14 and key resistance
• RES 1: 0.6709/17 50-day EMA / High May 2
• PRICE: 0.6667 @ 07:57 BST May 3
• SUP 1: 0.6621/6565 Low May 3 / Low Mar 10 and the bear trigger
• SUP 2: 0.6547 61.8% of the Oct - Feb bull cycle
• SUP 3: 0.6500 Round number support
• SUP 4: 0.6403 76.4% of the Oct - Feb bull cycle

AUDUSD traded higher Tuesday and briefly tested levels just above the 50-day EMA, at 0.6709. A clear breach of this EMA is required to suggest scope for a stronger bounce and open 0.6772, the Apr 20 high. On the downside, the key support to watch lies at 0.6565, the Mar 10 low. Clearance of this level would resume the downtrend that started on Feb 2 and this would pave the way for weakness towards 0.6547, a Fibonacci retracement point.

USDCAD TECHS: Key Resistance Remains Intact For now

• RES 4: 1.3830 2.0% 10-dma envelope
• RES 3: 1.3805 High Mar 24
• RES 2: 1.3695 High Mar 28
• RES 1: 1.3668 High Apr 28 and key resistance
• PRICE: 1.3615 @ 08:08 BST May 3
• SUP 1: 1.3528 Low May 2
• SUP 2: 1.3473 Low Apr 21
• SUP 3: 1.3385/3302 Low Apr 19 / 14 and the bear trigger
• SUP 4: 1.3275 Low Feb 14

USDCAD traded higher Tuesday. The bounce appears to be a correction and a bearish threat remains present. The failure to hold on to last Friday’s high exposes 1.3540, the 20-day EMA, which has been pierced. This EMA represents an important level and a break would highlight a stronger bearish threat, signalling scope for 1.3473, the Apr 21 low. On the upside, a recovery and break of 1.3668, Apr 28 high, would reinstate the recent bull cycle.

FIXED INCOME

BUND TECHS: (M3) Bull Cycle Extends

• RES 4: 137.55 61.8% retracement of the Mar 20 - Apr 19 bear leg
• RES 3: 136.88 High Apr 11
• RES 2: 136.70 50.0% retracement of the Mar 20 - Apr 19 bear leg
• RES 1: 136.37 High May 2
• PRICE: 136.13 @ 05:15 BST May 3
• SUP 1: 134.98 20-day EMA
• SUP 2: 133.64/133.10 Low Apr 28 / 19 and the bear trigger
• SUP 3: 132.70 76.4% retracement of the Mar 2 - 20 rally
• SUP 4: 132.37 Low Mar 10

Bund futures rallied Tuesday and cleared short-term resistance at 135.74, the Apr 26 high. The break higher reinforces short-term bullish conditions and signals scope for an extension. The focus is on 136.70, a Fibonacci retracement. On the downside, key short-term support has been defined at the Apr 19 low of 133.10. This is the bear trigger and a break would reinstate the recent bearish theme. Initial support is at 134.98, the 20-day EMA.

BOBL TECHS: (M3) Bullish Outlook

• RES 4: 119.190 High Apr 6
• RES 3: 119.009 61.8 retracement of the Mar 20 - Apr 19 downleg
• RES 2: 118.515 50.0% retracement of the Mar 20 - Apr 19 downleg
• RES 1: 118.430 High May 2
• PRICE: 118.240 @ 05:33 BST May 3
• SUP 1: 117.370 Low May 2
• SUP 2: 116.890/420 Low Apr 28 / 19 and the bear trigger
• SUP 3: 116.370 Low Mar 15
• SUP 4: 116.125 76.4% retracement of the Mar 6 - 20 rally

A strong recovery in Bobl futures on Tuesday reinforces a bullish theme - the contract has cleared recent resistance at 118.030, the Apr 26 high, to confirm a resumption of the bull cycle that started Apr 19. The focus is on a climb towards 118.515 next, a Fibonacci retracement. On the downside, key support has been defined at 116.420, the Apr 19 low, where a break would reinstate a bearish theme. Initial support is at 117.370, Tuesday’s low.

SCHATZ TECHS: (M3) Clears Short-Term Resistance

• RES 4: 106.190 High Apr 6
• RES 3: 106.060 50.0% retracement of the Mar 20 - Apr 19 bear leg
• RES 2: 106.000 Round number resistance
• RES 1: 105.850 High May 2
• PRICE: 105.760 @ 05:57 BST May 3
• SUP 1: 105.564/350 20-day EMA / Low Apr 28
• SUP 2: 105.165 Low Apr 19 / 24 and bear trigger
• SUP 3: 105.030 Low Mar 15
• SUP 4: 104.953 76.4% retracement of the Mar 9 - 20 rally

A short-term recovery in Schatz futures resumed Tuesday following gains above a recent resistance at 105.720, the Apr 26 high. This signals potential for a climb towards the 106.00 handle and 106.060, a Fibonacci retracement. Price has recently cleared resistance at the 20-day EMA reinforcing bullish conditions. Key support has been defined at 105.165, the Apr 24 / 19 low. Initial firm support lies at 105.350, the Apr 28 low.

GILT TECHS: (M3) Pierces The 20-Day EMA

• RES 4: 103.53 50.0% retracement of the Mar 20 - Apr 19 bear leg
• RES 3: 102.99 High Apr 14
• RES 2: 102.63 38.2% retracement of the Mar 20 - Apr 19 bear leg
• RES 1: 102.11 High May 2
• PRICE: 101.98 @ Close May 2
• SUP 1: 100.37/99.73 Low May 2 / Low Apr 19
• SUP 2: 99.55 Low Mar 8
• SUP 3: 99.20 Low Feb 28 and key support
• SUP 4: 99.00 Round number support

Gilt futures traded higher Tuesday. Attention is on resistance at the 20-day EMA which intersects at 101.97. The average has been pierced and a clear break would strengthen bullish conditions. This would open 102.63, a Fibonacci retracement level. On the downside, key support and the bear trigger has been defined at 99.73. Clearance of this level would resume the downtrend that started Mar 20. Initial support is at 100.37.

BTP TECHS: (M3) Recovery Extends

• RES 4: 118.00 Round number resistance
• RES 3: 117.17 High Mar 24 and the bull trigger
• RES 2: 115.92/116.97 High Apr 12 / 6
• RES 1: 115.54 61.8% retracement of the Mar 24 - Apr 24 downleg
• PRICE: 115.10 @ Close May 2
• SUP 1: 113.70 Low May 2
• SUP 2: 112.93/89 Low Apr 24 / 61.8% of the Mar 2 - 24 rally
• SUP 3: 111.88 76.4% retracement of the Mar 2 - 24 rally
• SUP 4: 111.05 Low Mar 8

BTP futures traded higher Tuesday to resume the bull cycle that started Apr 24. The recovery signals scope for a climb towards 115.92, the Apr 12 high ahead of key resistance at 117.17, the Mar 24 high. On the downside, key support has been defined at 112.93, the Apr 24 low. Clearance of this level would instead confirm a resumption of the recent downtrend. First support is 113.70, yesterday’s low.

EQUITIES

EUROSTOXX50 TECHS: (M3) Corrective Pullback Extends

• RES 4: 4520.00 High June 2001 (cont)
• RES 3: 4403.50 High Nov 18 2021 (cont) and a major resistance
• RES 2: 4381.50 High Jan 5 2022 (cont)
• RES 1: 4363.00 High Apr 21 and the bull trigger
• PRICE: 4279.00 @ 06:51 BST May 3
• SUP 1: 4255.00 Low May 2
• SUP 2: 4216.60 50-day EMA
• SUP 3: 4175.00 Low Mar 30
• SUP 4: 4164.00 High Mar 22

A key short-term support in Eurostoxx 50 futures at 4285.90 has been breached - the 20-day EMA. The recent move down is considered corrective for now. A continuation lower would signal scope for a deeper corrective pullback towards 4216.60, the 50-day EMA. On the upside, a break of 4363.00, the Apr 21 high and bull trigger, would confirm a resumption of the uptrend.

E-MINI S&P TECHS: (M3) Uptrend Remains Intact

• RES 4: 4288.00 High Aug 19 2022
• RES 3: 4244.00 High Feb 2 and a medium-term bull trigger
• RES 2: 4223.00 High Feb 14
• RES 1: 4206.25 High May 1
• PRICE: 4143.75 @ 08:06 BST May 3
• SUP 1: 4098.34/4068.75 50-day EMA / Low Apr 26
• SUP 2: 4061.11 38.2% retracement of the Mar 13 - Apr 18 bull leg
• SUP 3: 4052.50 Low Mar 30
• SUP 4: 4018.75 50.0% retracement of the Mar 13 - Apr 18 bull leg

S&P E-minis traded lower Tuesday and the contract breached the 20-day EMA. The move lower appears to be a correction. Trend conditions remain bullish with moving average studies still in a bull-mode set-up. The focus is on 4206.25, the May high and bull trigger. A break would confirm a resumption of the uptrend and open 4223.00, the Feb 14 high. Initial support to watch is 4098.34, the 50-day EMA.

COMMODITIES

BRENT TECHS: (N3) Impulsive Sell-Off Extends

• RES 4: $84.83 - High Apr 19
• RES 3: $82.88 - High Apr 25
• RES 2: $80.53 - High Apr 28 and a key short-term resistance
• RES 1: $77.36 - Low Apr 27 and a recent breakout level
• PRICE: $75.32 @ 05:55 BST May 3
• SUP 1: $75.07 - Low May 2
• SUP 2: $74.06 - 76.4% retracement of the Mar 20 - Apr 12 bull run
• SUP 3: $72.34 - Low Mar 24
• SUP 4: $70.10 - Low Mar 20 and a key support

A sharp sell-off in Brent futures Tuesday confirms a resumption of the current bearish cycle. The contract has breached $76.52, the 61.8% retracement of the Mar 20 - Apr 12 bull run. This opens $74.06, the 76.4% retracement point and $72.34 further out, the Apr 24 low. On the upside, key short-term resistance has been defined at $80.53, the Apr 28 high where a break would ease bearish pressure and highlight a potential reversal.

WTI TECHS: (M3) Remains Vulnerable

• RES 4: $81.24 - High Apr 19
• RES 3: $79.18 - High Apr 24
• RES 2: $76.92 - High Apr 28 and key short-term resistance
• RES 1: $74.03 - Low Apr 27
• PRICE: $71.49 @ 07:04 BST May 3
• SUP 1: $70.00 - Round number support
• SUP 2: $69.02 - 76.4% retracement of the Mar 20 - Apr 12 rally
• SUP 3: $67.02 - Low Mar 24
• SUP 4: $64.58 - Low Mar 20 and a key support

WTI futures remain in a downtrend and yesterday’s sharp sell-off reinforces this theme. The contract has cleared a number of retracement levels and this signals scope for weakness towards the $70.00 handle next and $69.02, the 76.4% retracement of the Mar 20 - Apr 12 rally. On the upside a key short-term resistance has been defined at $76.92, the Apr 28 high where a break would ease bearish pressure and potentially highlight a reversal.

GOLD TECHS: Corrective Cycle Remains In Play

• RES 4: $2075.5 - All-Time High Aug 7 2020
• RES 3: $2070.4 - High Mar 8 and a key resistance
• RES 2: $2059.2 - High Mar 9 2022
• RES 1: $2019.4/2048.7 - High May 2 / High Apr 13 and bull trigger
• PRICE: $1983.9 @ 07:14 BST May 2
• SUP 1: $1969.3 - Low Apr 19
• SUP 2: $1955.2 - 50-day EMA
• SUP 3: $1934.3 - Low Mar 22
• SUP 4: $1900.0 - Round number support

Gold traded higher Tuesday. For now, the yellow metal remains in a short-term bearish corrective cycle. Price has recently pierced support at $1990.5, the 20-day EMA, highlighting potential for a deeper retracement. A move lower would open $1955.2, the 50-day EMA. For bulls, key short-term resistance has been defined at $2048.7, the Apr 5 high. A break would confirm a resumption of the uptrend.

SILVER TECHS: Corrective Cycle Still In Play

• RES 4: $26.943 - High Mar 8 2022 and a key resistance
• RES 3: $26.771 - High Mar 9 2022
• RES 2: $26.222 - High Apr 18 2022 and a key resistance
• RES 1: $26.088 - High Apr 14 and the bull trigger
• PRICE: $25.227 @ 07:25 BST May 3
• SUP 1: $24.492 - Low Apr 25
• SUP 2: $23.949 - 50-day EMA
• SUP 3: $23.572 - Low Apr 3
• SUP 4: $22.828 - Low Mar 28

Silver remains in an uptrend and the recent pullback still appears to be a correction. The break, on Apr 4, of resistance at $24.637, the Feb 2 high, confirmed a resumption of the bull trend that started early September 2022. This opens $26.222, the Apr 18 2022 high. On the downside, a key support to watch is seen at $24.839, the 20-day EMA. It has been pierced, a clear break would signal scope for a deeper (corrective) pullback.