MNI DAILY TECHNICAL ANALYSIS - Dollar Dip Deemed Corrective

Price Signal Summary – Dollar Dip Deemed Corrective

• S&P E-Minis rallied sharply higher yesterday, extending the recovery from Monday’s trend low of 4056.75. Broader trend conditions remain bearish and the current bull phase is likely a correction. Initial resistance to watch is at 4303.50, the Apr 26/28 high. EUROSTOXX 50 futures continue to trade above 3608.00, Apr 27 low. Short-term gains are considered corrective and a bearish trend condition remains intact. This follows a reversal from the Apr 21 high of 3883.00 and price remains below the 50-day EMA.
• EURUSD traded higher Wednesday. Short-term gains are considered corrective and the overarching trend remains a bearish one. The move to fresh cycle lows last week confirmed an extension of the bearish price sequence of lower lows and lower highs. USDJPY bullish conditions remain in place and short-term dips are considered corrective. A bull flag has appeared on the daily chart - a continuation pattern that reinforces the uptrend. AUDUSD rallied Wednesday. The pair has traded above the 20-day EMA, however, a firmer resistance is seen at 0.7300. This is the 50-day EMA where a clear break is required to suggest scope for a stronger recovery.
• Gold gains are considered corrective. The yellow metal remains vulnerable. Price has recently cleared support at the 50-day EMA. Furthermore, the pullback from $1998.4 (Apr 18 high), continues to highlight a bearish threat. WTI futures remain above the Apr 25 low of $95.28. The contract also maintains this week’s bullish tone. Price has broken out of its triangle - to the upside - and this does strengthen the short-term condition for bulls.
• Trend signals in Bund futures continue to point south and short-term gains are considered corrective. The contract traded to a fresh cycle low yesterday of 152.44. The move lower confirms an extension of the bearish price sequence of lower lows and lower highs. Gilt futures are unchanged. The trend condition remains bearish. Moving average studies continue to point south and the dominant bearish price sequence of lower lows and lower highs remains intact.

FOREIGN EXCHANGE

EURUSD TECHS: Primary Trend Remains Down

• RES 4: 1.0936 High Apr 21 and a key resistance
• RES 3: 1.0852 High Apr 22
• RES 2: 1.0711/58 20-day EMA / Low Apr 14 - recent breakout level
• RES 1: 1.0655 High Apr 27
• PRICE: 1.0616 @ 06:01 BST May 5
• SUP 1: 1.0472/54 Low Apr 28 / Low Jan 1 2017
• SUP 2: 1.0390 Low Jan 4 2017
• SUP 3: 1.0341 Low Jan 3 2017 and a key support
• SUP 4: 1.0333 1.236 proj of the Feb 10 - Mar 7 - 31 price swing

EURUSD traded higher Wednesday. Short-term gains are considered corrective and the overarching trend remains a bearish one. The move to fresh cycle lows last week confirmed an extension of the bearish price sequence of lower lows and lower highs. A bearish set-up in moving average studies also highlights a downtrend. A resumption of weakness would open 1.0454, the Feb 22 2017 low. Watch resistance at 1.0711, the 20-day EMA.

GBPUSD TECHS: Bearish Outlook

• RES 4: 1.2974 Low Apr 13 and a recent breakout level
• RES 3: 1.2877 High Apr 25
• RES 2: 1.2772/82 High Apr 26 / 20-day EMA
• RES 1: 1.2638 High May 4
• PRICE: 1.2554 @ 06:11 BST May 5
• SUP 1: 1.2412 Low Apr 28 and the bear trigger
• SUP 2: 1.2375 2.382 proj of the Mar 23 - Apr 13 - 14 price swing
• SUP 3: 1.2252 Low Jun 29 2020
• SUP 4: 1.2162 Low May 22 2020

A bearish risk in GBPUSD remains present. The recovery from 1.2412, Apr 208 low highlights a shallow correction and a bearish flag formation. This reinforces the current bearish theme following the recent impulsive sell-off that occurred between Apr 21 - 28. A breach of 1.2412 would confirm a resumption of the downtrend and open 1.2375, a Fibonacci projection. The 20-day EMA at 1.2782, is seen as firm resistance.

EURGBP TECHS: Eyeing First Resistance

• RES 4: 0.8600 High Dec 8 2021
• RES 3: 0.8552/53 2.0% 10-dma envelope / High Dec 14 2020
• RES 2: 0.8512 High Mar 31 and a key resistance
• RES 1: 0.8468 High Apr 27 and an intraday bull trigger
• PRICE: 0.8449 @ 06:18 BST May 5
• SUP 1: 0.8373/67 50-day EMA / Low May 2
• SUP 2: 0.8313 Low Apr 22
• SUP 3: 0.8250 Low Apr 14 and a key support
• SUP 4: 0.8203 Low Mar 7 and the bear trigger

The EURGBP outlook remains bullish and the cross is trading higher today. Recent gains resulted in a break of 0.8405, the Apr 11 high. Clearance of this level highlights a bullish development and this also resulted in a move above 0.8435, the Apr 4 high. A continuation higher would open 0.8512, the Mar 31 high and the next key resistance point. Firm support to watch lies at 0.8367, Monday’s low and just below the 50-day EMA.

USDJPY TECHS: Bull Flag

• RES 4: 133.11 High Apr 4 2002
• RES 3: 132.39 High Apr 15 2002
• RES 2: 131.96 1.00 proj of the Feb 24 - Mar 28 - 31 price swing
• RES 1: 131.25 High Apr 28 and the bull trigger
• PRICE: 129.33 @ 06:38 BST May 5
• SUP 1: 127.48 20-day EMA
• SUP 2: 126.95 Low Apr 27 and a key support
• SUP 3: 125.09 Low Apr 14
• SUP 4: 124.01 Low Apr 11

USDJPY bullish conditions remain in place and short-term dips are considered corrective. A bull flag has appeared on the daily chart - a continuation pattern that reinforces the uptrend. A break of resistance at 131.25, Apr 28 high would confirm a resumption of the uptrend and open 131.96, a Fibonacci projection. On the downside, key support has been defined at 126.95, the Apr 27 low. A break would signal a reversal.

EURJPY TECHS: Consolidation Mode

• RES 4: 141.06 High Jun 4 2015 and a key resistance
• RES 3: 139.88 3.0% 10-dma envelope
• RES 2: 140.93 0.50 proj of the Mar 7 - 28 - Apr 8 price swing
• RES 1: 138.00/140.00 High Apr 28 / High Apr 21 and the bull trigger
• PRICE: 136.76 @ 20:05 BST May 4
• SUP 1: 134.79 Low Apr 27
• SUP 2: 134.57/30 50-day EMA / Low Apr 5 and a key support
• SUP 3: 132.95 Low Mar 24
• SUP 4: 132.33 Low Mar 23

EURJPY is consolidating. The recent pullback is considered corrective and the trend direction is up. The cross has remained above key support highlighted by the 50-day EMA. The average intersects at 134.57, just above an important support at 134.30, Apr 5 low. While this 134.57-30 zone holds, trend conditions remain bullish. Initial resistance is unchanged at 138.00, Apr 28 high. The bull trigger is also unchanged at 140.00, Apr 21 high.

AUDUSD TECHS: Remains Below The 50-Day EMA

• RES 4: 0.7458 High Apr 20/21 and a key resistance
• RES 3: 0.7379 High Apr 22
• RES 2: 0.7300 50-day EMA
• RES 1: 0.7266 High May 4 and intraday high
• PRICE: 0.7239 @ 06:58 BST May 5
• SUP 1: 0.7089/7030 Low May 4 / Low May 2 and the bear trigger
• SUP 2: 0.6985 Low Jan 31
• SUP 3: 0.6968 Low Jan 28 and a bear trigger
• SUP 4: 0.6921 Low Jul 14 2020

AUDUSD rallied Wednesday. The pair has traded above the 20-day EMA, however, a firmer resistance is seen at 0.7300. This is the 50-day EMA where a clear break is required to suggest scope for a stronger recovery. Short-term gains are considered corrective - for now. A resumption of weakness would refocus attention on Monday’s low of 0.7030. This level has been defined as key support and a bear trigger.

USDCAD TECHS: Corrective Cycle

• RES 4: 1.3035 2.0% 10-dma envelope
• RES 3: 1.3024 38.2% retracement of the Mar ‘20 - Jun ‘21 downleg
• RES 2: 1.2964 High Dec 20 2021 and a key bull trigger
• RES 1: 1.2853/2914 High May 4 / High May 2 and the bull trigger
• PRICE: 1.2725 @ 07:07 BST May 5
• SUP 1: 1.2714/2674 Low Apr 29 / 50-day EMA
• SUP 2: 1.2568 Low Apr 22
• SUP 3: 1.2459 Low Apr 21
• SUP 4: 1.2403 Low Apr 5 and a key support

USDCAD slipped Wednesday. This week’s move lower is still considered corrective and the broader trend needle continues to point north. Key short-term support lies at the 50-day EMA, at 1.2674, where a break is required to suggest potential for a deeper sell-off. Monday’s high print of 1.2914 reinforced bullish conditions. A resumption of gains would refocus attention on this key short-term resistance.

FIXED INCOME

BUND TECHS: (M2) Trend Conditions Remain Bearish

• RES 4: 158.24 50-day EMA
• RES 3: 157.87 High Apr 7
• RES 2: 156.00 High Apr 28 and a key short-term resistance
• RES 1: 155.17 20-day EMA
• PRICE: 153.43 @ 04:51 BST May 5
• SUP 1: 152.44 Low May 4
• SUP 2: 151.99 0.618 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 3: 150.15 0.764 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 4: 150.00 Psychological round number

Trend signals in Bund futures continue to point south and short-term gains are considered corrective. The contract traded to a fresh cycle low yesterday of 152.44. The move lower confirms an extension of the bearish price sequence of lower lows and lower highs and moving average studies remain in bear mode. Attention is on 151.99 next, a Fibonacci projection. Firm resistance has been defined at 156.00, the Apr 28 high.

BOBL TECHS: (M2) Fresh Cycle Low

• RES 4: 129.350 High Apr 4 and a reversal point
• RES 3: 128.830 High Apr 7
• RES 2: 128.310 High Apr 8/28 and a key near-term resistance
• RES 1: 127.792 20-day EMA
• PRICE: 127.200 @ 04:57 BST May 5
• SUP 1: 126.530 Low May 4
• SUP 2: 126.480 Low Jun 5 2014 (cont)
• SUP 3: 126.196 0.50 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 4: 126.00 Round number support

Bobl futures remain below the Apr 28 high of 128.310. Trend conditions remain bearish. Fresh cycle lows in April, and again yesterday, reinforce the primary downtrend, maintaining the broader bearish price sequence of lower lows and lower highs. Note that moving averages continue to point south. An extension lower would open 126.480 next, Jun 5 2014 low (cont). Key short-term trend resistance is at 128.310, the Apr 14/28 high.

SCHATZ TECHS: (M2) Path Of Least Resistance Remains Down

• RES 4: 110.822 50-day EMA
• RES 3: 110.855 High Apr 4
• RES 2: 110.540 High Apr 28 and a key resistance
• RES 1: 110.427 20-day EMA
• PRICE: 110.220 @ 04:53 BST May 5
• SUP 1: 110.015 Low May 4
• SUP 2: 110.000 Round number support
• SUP 3: 109.983 0.50 proj of the Mar 7 - 30 - Apr 4 price swing
• SUP 4: 109.777 0.618 proj of the Mar 7 - 30 - Apr 4 price swing

The trend direction in Schatz futures is unchanged and remains down. Wednesday’s fresh cycle low reinforces this condition. The move lower confirms a resumption of the primary downtrend and an extension of the broader bearish price sequence of lower lows and lower highs. Moving average studies remain in a bear mode. The focus is on 109.983 next, a Fibonacci projection. Key short-term resistance is 110.540, the Apr 28 high.

GILT TECHS: (M2) Bearish Outlook

• RES 4: 122.35 High Apr 4
• RES 3: 120.55 50-day EMA
• RES 2: 120.47 High Apr 8
• RES 1: 119.79 High Apr 25 and a key short-term resistance
• PRICE: 117.83 @ Close May 4
• SUP 1: 117.22 Low Apr 22 and a bear trigger
• SUP 2: 117.04 0.764 proj of the Mar 1 - 28 - Apr 4 price swing
• SUP 3: 116.35 Low Dec 30 2015
• SUP 4: 115.40 1.00 proj of the Mar 1 - 28 - Apr 4 price swing

Gilt futures are unchanged. The trend condition remains bearish. Moving average studies continue to point south and the dominant bearish price sequence of lower lows and lower highs remains intact. A firm resistance has been defined at 119.79, Apr 26 high where a break is required to reinstate a bullish theme. Attention is on the 117.22 bear trigger. A breach of this level would confirm a resumption of the primary downtrend.

BTP TECHS: (M2) Southbound

• RES 4: 136.30 50-day EMA
• RES 3: 136.12 High Apr 7
• RES 2: 135.23 High Apr 14
• RES 1: 132.61/133.53 20-day EMA / High Apr 28
• PRICE: 128.51 @ Close May 4
• SUP 1: 128.10 Low May 4
• SUP 2: 128.08 2.00 proj of the Mar 31 - Feb 16 - Mar 1 price swing
• SUP 3: 127.63 1.00 proj of the Mar 1 - 29 - 31 price swing
• SUP 4: 125.88 2.236 proj of the Mar 31 - Feb 16 - Mar 1 price swing

The trend condition in BTP futures remains bearish - Wednesday’s move lower resulted in another cycle low print. This maintains the broader bearish price sequence of lower lows and lower highs that defines a downtrend. Moving average studies are in a bear mode too and the focus is on 128.08 next, a Fibonacci projection. Firm short-term resistance has been defined at 133.53, the Apr 28 high.

EQUITIES

EUROSTOXX50 TECHS: (M2) Corrective Cycle

• RES 4: 4132.00 High Feb 10
• RES 3: 4072.00 High Feb 16
• RES 2: 3944.00 High Mar 29 and a key resistance
• RES 1: 3790.50/3883.00 50-day EMA / High Apr 21
• PRICE: 3769.00 @ 05:26 BST May 5
• SUP 1: 3608.00 Low Apr 27 and the bear trigger
• SUP 2: 3551 60 61.8% retracement of the Mar 7 - 29 rally
• SUP 3: 3523.00 Low Mar 11
• SUP 4: 3458.90 76.4% retracement of the Mar 7 - 29 rally

EUROSTOXX 50 futures continue to trade above 3608.00, Apr 27 low. Short-term gains are considered corrective and a bearish trend condition remains intact. This follows a reversal from the Apr 21 high of 3883.00 and price remains below the 50-day EMA. Last week’s breach of support at 3684.00, Apr 12 low has also reinforced a bearish condition. Resistance to watch is; 3790.50, the 50-day EMA and 3883.00, the Apr 21 high.

E-MINI S&P (M2): Gains Considered Corrective

• RES 4: 4588.75 High Apr 5
• RES 3: 4509.00 High Apr 21 and a key short-term resistance
• RES 2: 4375.43 50-day EMA
• RES 1: 4303.50/4355.50 High Apr 26/28 / Low Apr 18
• PRICE: 4292.00 @ 05:13 BST May 5
• SUP 1: 4142.75/4056.00 Low May 4 / Low May 2 and the bear trigger
• SUP 2: 4029.25 High May 13 2021
• SUP 3: 4000.00 Psychological round number
• SUP 4: 3958.00 2.00 proj of the Mar 29 - Apr 18 - 21 price swing

S&P E-Minis rallied sharply higher yesterday, extending the recovery from Monday’s trend low of 4056.75. Broader trend conditions remain bearish and the current bull phase is likely a correction. Initial resistance to watch is at 4303.50, the Apr 26/28 high. A break would suggest scope for an extension higher towards the 50-day EMA at 4375.43. A resumption of weakness would refocus attention on the bear trigger at 4056.00.

COMMODITIES

BRENT TECHS: (N2) Monitoring Triangle Resistance

• RES 4: $121.13 - 76.4% retracement of the Mar 7 - 15 downleg
• RES 3: $115.76 - High Mar 24 and a bull trigger
• RES 2: $113.61 - High Apr 18 and a key near-term resistance
• RES 1: $111.96 - Triangle resistance
• PRICE: $111.17 @ 07:02 BST May 5
• SUP 1: $103.10/99.25 - Low May 2 / Low Apr 25
• SUP 2: $97.18 - Low Apr 11
• SUP 3: $92.59 - Low Mar 15 and a key support
• SUP 4: $89.01 - Low Feb 25

Brent futures maintain this week’s firmer tone and the contract has traded higher today. Price action remains inside a triangle formation, drawn from the Mar 15 low. This appears to be a bearish pattern. A break below $99.25 would highlight a triangle breakout and expose $97.18, the Apr 11 low, and $92.59, the Mar 15 low. Triangle resistance intersects at $111.86 today and represents a key short-term resistance.

WTI TECHS: (M2) Triangle Breakout

• RES 4: $119.95 - High Mar 8
• RES 3: $118.13 - High Mar 9
• RES 2: $113.51/113.90 - High Mar 24 / 76.4% of Mar 7 - 15 downleg
• RES 1: $109.20 - High Apr 18
• PRICE: $108.96 @ 07:17 BST May 5
• SUP 1: $102.94 - 20-day EMA
• SUP 2: $100.28/95.28 - Low May 2 / Low Apr 25
• SUP 3: $92.60 - Low Apr 11 and a key support
• SUP 4: $90.37 - Low Mar 15 and a bear trigger

WTI futures remain above the Apr 25 low of $95.28. The contract also maintains this week’s bullish tone. Price has broken out of its triangle - to the upside - and this does strengthen the short-term condition for bulls. Attention is on resistance at $109.20, the Apr 18 high, where a break would signal scope for a continuation higher. This would open $113.51, the Mar 24 high. Initial firm support lies at $100.28, the May 2 low.

GOLD TECHS: Bearish, Despite Recent Gains

• RES 4: $2001.6 - 61.8% retracement of the Mar 8 - 29 downleg
• RES 3: $1998.4 - High Apr 18 and a bull trigger
• RES 2: $1958.4 - High Apr 20
• RES 1: $1913.9 - 20-day EMA
• PRICE: $1901.2 @ 07:17 BST May 5
• SUP 1: $1850.5 - Low May 3
• SUP 2: $1848.8 - 76.4% retracement of the Jan 28 - Mar 8 rally
• SUP 3: $1821.1 - Low Feb 11
• SUP 4: $1780.4 - Low Jan 28

Gold gains are considered corrective. The yellow metal remains vulnerable. Price has recently cleared support at the 50-day EMA. Furthermore, the pullback from $1998.4 (Apr 18 high), continues to highlight a bearish threat. This was reinforced last week by the break of $1890.2, Mar 29 low. The move lower Tuesday opens $1848.8, a Fibonacci retracement. On the upside, $1913.9, the 20-day EMA is seen as a firm short-term resistance.

SILVER TECHS: Bearish Outlook

• RES 4: $27.245 - High Jun 17 2021
• RES 3: $26.943 - High Mar 8 and the bull trigger
• RES 2: $26.222 - High Apr 18 and a key short-term resistance
• RES 1: $24.284 - 50-day EMA
• PRICE: $23.139 @ 07:56 BST May 5
• SUP 1: $22.123 - Low May 2
• SUP 2: $22.008 - Low Feb 3 and a key support
• SUP 3: $21.949 - Low Jan 7 2022
• SUP 4: $21.427 - Low Dec 15

Silver remains bearish following the recent reversal from $26.222, Apr 18 high. Last week’s continuation lower, and Monday’s fresh low, has reinforced bearish conditions. Support at $23.974, Mar 29 low and $23.173, 76.4% of the Feb 3 - Mar 8 rally, have been cleared. The clear break of the latter has opened $22.008, the Feb 3 low and the next key support. The 50-day EMA, at $24.284 marks resistance. Short-term gains are considered corrective.