MNI DAILY TECHNICAL ANALYSIS - Equity Price Action Reinforces Bearish Conditions

Price Signal Summary – Equity futures price action reinforces bearish conditions

• S&P E-Minis remain soft and yesterday's low print reinforces bearish conditions. The move lower has also reinforced recent reversal signals - a shooting star candle on Dec 13 followed by a break on Dec 15, of support at 3945.75, the Dec 7 low. EUROSTOXX 50 futures remain in a bear mode position and yesterday’s low print reinforces this theme. The break lower has resulted in a breach of the 50-day EMA - at 3799.80.
• The USDJPY trend outlook remains bearish following Tuesday's 6 point drop in the pair. Key support at 131.74 has given way, opening losses toward late August lows of 130.41 for direction. A sharp sell-off in AUDUSD last Thursday signalled a S/T top and Tuesday’s move lower reinforced this turn. The 20-day EMA has been cleared and attention is on the 50-day EMA at 0.6662 - this average has been pierced. USDCAD has recently pierced resistance at 1.3700, the Dec 7 high and the outlook remains bullish. The recent break of trendline resistance, drawn from the Oct 13 high, has strengthened bullish conditions and this has opened 1.3751, the Nov 4 high.
• Trend conditions in WTI futures remain bearish. Recent gains however, have highlighted a bullish corrective cycle and this has resulted in a test of the 20-day EMA, at $76.80 today. Trend conditions in Gold remain bullish and the recent move lower is considered corrective. Key short-term support to watch is $1765.9, Dec 5 low. The yellow metal breached $1810.0 last week, Dec 5 high, to resume the uptrend.
• Bund futures traded lower last week to extend the current bear phase that started Dec 7. The contract has maintained a bearish tone this week. Recent weakness resulted in a break of support at 139.13, Nov 28 low, strengthening a bearish threat. Gilt futures remain bearish and the contract traded lower Tuesday, extending the current bearish leg. This week’s price action has resulted in a clear break of support at 103.54, the Nov 21 low.

FOREIGN EXCHANGE

EURUSD TECHS: Bullish Outlook

• RES 4: 1.0851 High Apr 25
• RES 3: 1.0787 High May 30 and a key resistance
• RES 2: 1.0769/74 2.0% 10-dma envelope / High Jun 9
• RES 1: 1.0736 2.382 proj of the Sep 28 - Oct 4 - 13 price swing
• PRICE: 1.0612 @ 05:47 GMT Dec 21
• SUP 1: 1.0528 Low Dec 13
• SUP 2: 1.0502 20-day EMA
• SUP 3: 1.0443 Low Dec 7 and a key short-term support
• SUP 4: 1.0312 50-day EMA

EURUSD is unchanged and remains below last week’s highs. The latest pullback is considered corrective. Last week’s break higher confirmed a resumption of the uptrend and maintains the price sequence of higher highs and higher lows. Sights are on 1.0736, a Fibonacci projection. On the downside, key short-term support to watch is at 1.0443, Dec 7 low, where a break would signal a short-term top. Initial support is 1.0528, the Dec 13 low.

GBPUSD TECHS: Bear Threat Still Present

• RES 4: 1.2667 High May 27
• RES 3: 1.2599 High Jun 7
• RES 2: 1.2506 1.382 proj of the Sep 26 - Oct 5 - Oct 12 price swing
• RES 1: 1.2446 High Dec 14 and the bull trigger
• PRICE: 1.2166 @ 06:01 GMT Dec 21
• SUP 1: 1.2086 Low Dec 20
• SUP 2: 1.2054 Low Dec 1
• SUP 3: 1.1905/1901 50-day EMA / Low Nov 30 and a key support
• SUP 4: 1.1779 Low Nov 21

GBPUSD is trading closer to its recent lows and the short-term outlook appears bearish. This follows the move lower on Dec 15. Attention is on the first key support at 1.2107, the Dec 7 low. It has been pierced, a clear break would open 1.1901, the Nov 30 low. On the upside, key short-term resistance has been defined at 1.2446, the Dec 14 high. A turn higher and a break of this hurdle, would confirm a resumption of the uptrend.

EURGBP TECHS: Remains Above Support

• RES 4: 0.8907 50.0% retracement of the Sep 26 - Dec 1 bear leg
• RES 3: 0.8867 High Oct 12
• RES 2: 0.8829 High Nov 09 and the bull trigger
• RES 1: 0.8776 High Nov 16
• PRICE: 0.8725 @ 06:14 GMT Dec 21
• SUP 1: 0.8663/8593 50-day EMA / Low Dec 15
• SUP 2: 0.8558/47 200-dma / Low Dec 1 and bear trigger
• SUP 3: 0.8522 Low Aug 30
• SUP 4: 0.8471 Low Aug 28

EURGBP is unchanged and continues to consolidate. Price rallied sharply higher on Dec 15 and in the process cleared the 50-day EMA at 0.8663. The break higher has improved the short-term outlook for bulls and signals scope for a climb towards resistance at 0.8829, the Nov 9 high and a bull trigger. On the downside, key support has been defined at 0.8547, the Dec 1 low, where a break would signal a continuation of the downtrend.

USDJPY TECHS: Bears Remains In The Driver's Seat

• RES 4: 139.73 50-day EMA
• RES 3: 138.17 High Dec 15
• RES 2: 137.21 20-day EMA
• RES 1: 134.54 Low Dec 14
• PRICE: 132.06 @ 06:26 GMT Dec 21
• SUP 1: 130.58 Low Dec 20
• SUP 2: 130.41 Low Aug 2 and a key support
• SUP 3: 129.51 Low Jun 2
• SUP 4: 128.44 1.236 proj of the Oct 31 - Nov 15 - 21 price swing

The USDJPY trend outlook remains bearish following Tuesday's 6 point drop in the pair. Key support at 131.74 has given way, opening losses toward late August lows of 130.41 for direction. Moving average studies are in a bear-mode position and price remains well below the 20-day EMA, at 137.21. The daily RSI is nearing oversold territory, which could slow downside progress near-term, but the overarching theme remains negative for now.

EURJPY TECHS: Trend Needle Points South

• RES 4: 146.73 High Dec 15 and a key resistance
• RES 3: 145.83 High Dec 20
• RES 2: 143.50 Low Dec 14 and a recent breakout level
• RES 1: 142.00 Round number resistance
• PRICE: 140.32 @ 06:54 GMT Dec 21
• SUP 1: 138.81 Low Dec 20
• SUP 2: 138.43 4.0% 10-dma envelope
• SUP 3: 138.06 Low Sep 28
• SUP 4: 137.40 Low Sep 26 and a key support

EURJPY traded sharply lower Thursday as the JPY rallied. A key support at 140.77, the Dec 2 low and a bear trigger, has been cleared. This marks a resumption of the bear cycle that started on Oct 21 and opens 138.06, the Sep 28 low and 137.40, the Sep 26 low and a key support. Initial firm resistance is seen at 143.50, the Dec 14 low and a recent breakout level. Short-term gains would likely be a correction.

AUDUSD TECHS: Pierces Support At The 50-Day EMA

• RES 4: 0.6976 2.00 proj of the Oct 13 - 27 - Nov 3 price swing
• RES 3: 0.6956 High Aug 30
• RES 2: 0.6909 76.4% retracement of the Aug 11 - Oct 13 downleg
• RES 1: 0.6744/6893 High Dec 20 / High Dec 13 and the bull trigger
• PRICE: 0.6672 @ 07:23 GMT Dec 21
• SUP 1: 0.6629 Low Dec 20
• SUP 2: 0.6585 Low Nov 21 and a key short-term support
• SUP 3: 0.6531 50.0% retracement of the Oct 13 - Dec 13 climb
• SUP 4: 0.6500 Round number support

A sharp sell-off in AUDUSD last Thursday signalled a S/T top and Tuesday’s move lower reinforced this turn. The 20-day EMA has been cleared and attention is on the 50-day EMA at 0.6662 - this average has been pierced. A clear break would suggest potential for a deeper retracement towards 0.6585, the Nov 21 low. On the upside, key resistance has been defined at 0.6893, Dec 13 high. A break would resume the recent uptrend.

USDCAD TECHS: Bullish Outlook

• RES 4: 1.3855 High Oct 21 - Nov 16 bear leg
• RES 3: 1.3808 High Nov 3 and a key resistance
• RES 2: 1.3751 High Nov 4
• RES 1: 1.3705 High Dec 16
• PRICE: 1.3607 @ 07:54 GMT Dec 21
• SUP 1: 1.3571/3519 20-day EMA / Low Dec 14
• SUP 2: 1.3425/3385 Former trendline resistance / Low Dec 5
• SUP 3: 1.3317/3226 Low Nov 24/25 / Low Nov 15 and bear trigger
• SUP 4: 1.3205 61.8% retracement of the Aug 11 - Oct 13 rally

USDCAD has recently pierced resistance at 1.3700, the Dec 7 high and the outlook remains bullish. The recent break of trendline resistance, drawn from the Oct 13 high, has strengthened bullish conditions and this has opened 1.3751, the Nov 4 high. On the downside, a break below the former trendline resistance - at 1.3425 - would be bearish and expose 1.3385, the Dec 5 low. Initial key support to watch lies at 1.3519, the Dec 14 low.

FIXED INCOME

BUND TECHS: (H3) Bear Cycle Intact

• RES 4: 140.78 High Dec 15
• RES 3: 139.32 20-day EMA
• RES 2: 138.62 High Dec 16
• RES 1: 137.76 High De 19
• PRICE: 135.752 @ 05:20 GMT Dec 21
• SUP 1: 135.60 Intraday low
• SUP 2: 135.00 Round number support
• SUP 3: 134.50 Low Nov 8 and a key support
• SUP 4: 134.02 Low Oct 21 (cont)

Bund futures traded lower last week to extend the current bear phase that started Dec 7. The contract has maintained a bearish tone this week. Recent weakness resulted in a break of support at 139.13, Nov 28 low, strengthening a bearish threat. Furthermore, a number of additional support points have been cleared. The focus is on 135.00 next. On the upside, initial firm resistance is seen at 139.32, the 20-day EMA.

BOBL TECHS: (H3) Downtrend Extends

• RES 4: 119.230 High Dec 15
• RES 3: 118.484 20-day EMA
• RES 2: 118.260 Low Nov 28 and a recent breakout point
• RES 1: 117.720 High Dec 16
• PRICE: 116.920 @ 05:24 GMT Dec 21
• SUP 1: 116.830 Intraday low
• SUP 2: 116.773 1.764 proj of the Dec 7 - 12 - 13 price swing
• SUP 3: 116.410 2.00 proj of the Dec 7 - 12 - 13 price swing
• SUP 4: 116.047 2.236 proj of the Dec 7 - 12 - 13 price swing

The sell-off late last week in Bobl futures strengthened the current bearish cycle and support at 118.260, the Dec 13 low, has been cleared. This week’s move lower has reinforced the bearish threat. The extension signals scope for 116.773 next, a Fibonacci projection. On the upside, initial firm resistance is seen at 118.260, the recent breakout level. The 20-day EMA intersects at 118.484.

SCHATZ TECHS: (H3) Remains Vulnerable

• RES 4: 106.875 High Dec 2 and the bull trigger
• RES 3: 106.680 High Dec 13
• RES 2: 106.570 High Dec 15
• RES 1: 106.005/106.335 High Dec 16 / Low Nov 28
• PRICE: 105.810 @ 05:36 GMT Dec 21
• SUP 1: 105.770 Low Dec 20
• SUP 2: 105.660 2.00 projection of the Dec 2 - 13 price swing
• SUP 3: 105.540 2.236 projection of the Dec 2 - 13 price swing
• SUP 4: 105.465 2.382 projection of the Dec 2 - 13 price swing

Schatz futures remain soft following last week’s sell-off - this resulted in a break of support at 106.335, the Nov 28 low. The break lower, signals potential for a deeper pullback that has opened 105.660 and 105.540, Fibonacci projections. On the upside, 106.335 is a firm resistance. A break of this level is required to suggest a potential reversal. This would open 106.680, the Dec 13 high.

GILT TECHS: (H3) Bear Leg Extends

• RES 4: 106.95 High Dec 2
• RES 3: 106.18 High Dec 12
• RES 2: 105.29 High Dec 15 and a key short-term resistance
• RES 1: 103.67/104.31 High Dec 19 / 16
• PRICE: 101.13 @ Close Dec 20
• SUP 1: 100.68 Low Dec 20
• SUP 2: 100.00/99.92 Psychological support / Low Nov 8 (cont)
• SUP 3: 98.15 Low Oct 24 (cont)
• SUP 4: 97.33 61.8% retracement of the Oct 12 - Nov 25 bull phase

Gilt futures remain bearish and the contract traded lower Tuesday, extending the current bearish leg. This week’s price action has resulted in a clear break of support at 103.54, the Nov 21 low. This has strengthened the current downtrend and signals scope for a deeper pullback - towards the 100.00 psychological support. A break would open 98.15, the Oct 4 low (cont). Initial firm resistance is seen at 105.29, the Dec 15 high.

BTP TECHS: (H3) Outlook Remains Bearish

• RES 4: 119.00 Round number resistance
• RES 3: 118.96 High Dec 7 and the bull trigger
• RES 2: 117.93 High Dec 13
• RES 1: 113.23/116.43 High Dec 16 / High Dec 15
• PRICE: 110.75 @ Close Dec 21
• SUP 1: 110.49 Low Dec 20
• SUP 2: 110.00 Round number support
• SUP 3: 109.46 Low Nov 8
• SUP 4: 107.51 Low Oct 24

BTP futures remain soft following last week’s bearish price action and the contract has traded lower this week. Price has recently cleared support at 115.01, the Nov 28 low and this strengthened bearish conditions. Attention is on the 110.00 handle. On the upside, initial firm resistance is far-off at 117.93, Dec 13 high. A break would expose key resistance and the bull trigger at 118.96, the Dec 7 high. First resistance is 113.23, the Dec 16 high.

US 10YR FUTURE TECHS: (H3) Breaches Support

• RES 4: 116-25 2.0% 10-dma envelope
• RES 3: 115-26 2.00 proj of the Oct 21 - 27 - Nov 3 price swing
• RES 2: 115-14 50% Aug - Oct Downleg
• RES 1: 114-23/115-11+ High Dec 19 / 13 and the bull trigger
• PRICE: 113-20 @ 15:28 GMT Dec 20
• SUP 1: 113-11+ Intraday low
• SUP 2: 112-11+ Low Nov 21 and a key short-term support
• SUP 3: 112-05+ Low Nov 14
• SUP 4: 110-22 Low Nov 10

Treasury futures have started this week on a bearish note. Today’s move lower has resulted in a break of support at 113-22+, the Dec 12 low and a key short-term level. This undermines the recent bull theme and instead suggests scope for a deeper retracement. The focus is on 112-11+, the Nov 21 low. Note that the contract has pierced the 50-day EMA - at 113-15. A clear break would strengthen the bear threat. Key resistance is at 115-11+.

EQUITIES

EUROSTOXX50 TECHS: (H3) Gains Considered Corrective

• RES 4: 4132.60 76.4/% of the Nov ‘21 - Oct ‘22 bear leg (cont)
• RES 3: 4049.50 High Feb 23 (cont)
• RES 2: 4043.00 High Dec 13 and the bull trigger
• RES 1: 3887.20 20-day EMA
• PRICE: 3833.00 @ 05:52 GMT Dec 21
• SUP 1: 3753.00 Low Dec 20
• SUP 2: 3646.50 50% retracement of the Sep - Dec bull cycle
• SUP 3: 3580.00 Low Nov 3
• SUP 4: 3552.90 61.8% retracement of the Sep - Dec bull cycle

EUROSTOXX 50 futures remain in a bear mode position and yesterday’s low print reinforces this theme. The break lower has resulted in a breach of the 50-day EMA - at 3799.80. Price is back above the EMA but short-term gains are considered corrective. A continuation lower would open 3720.00 next, the Nov 10 low. On the upside, initial firm resistance is seen at the 20-day EMA - it intersects at 3887.20.

EQUITY TECHS: E-MINI S&P (H3): Bearish Theme Dominates

• RES 4: 4250.00 High Aug 26
• RES 3: 4194.25 High Sep 13 and a key resistance
• RES 2: 4043.00/4180.00 High Dec 15 / 13 and the bull trigger
• RES 1: 3899.00/3948.02 High Dec 19 / 50-day EMA
• PRICE: 3867.75 @ 06:51 GMT Dec 21
• SUP 1: 3778.45 61.8% retracement of the Oct 13 - Dec 13 uptrend
• SUP 2: 3735.00 Low Nov 3
• SUP 3: 3670.00 76.4% retracement of the Oct 13 - Dec 13 uptrend
• SUP 4: 3735.00 Low Oct 21

S&P E-Minis remain soft and yesterday's low print reinforces bearish conditions. The move lower has also reinforced recent reversal signals - a shooting star candle on Dec 13 followed by a break on Dec 15, of support at 3945.75, the Dec 7 low. The focus is on 3778.45, a Fibonacci projection. On the upside, initial firm resistance is seen at 3948.02, the 50-day EMA. A break of this EMA is required to ease bearish pressure.

COMMODITIES

BRENT TECHS: (G3) Resistance At The 20-Day EMA Remains Intact

• RES 4: $91.63 - High Nov 17
• RES 3: $89.37 - High Dec 1
• RES 2: $85.50 - 50-day EMA
• RES 1: $82.03/83.18 - 20-day EMA / High Dec 15
• PRICE: $80.17 @ 06:57 GMT Dec 21
• SUP 1: $78.10/75.11 - Low Dec 13 / Low Dec 9 and the bear trigger
• SUP 2: $72.33 - 1.00 proj of the Nov 7 - 28 - Dec 1 price swing
• SUP 3: $69.28 - Low Dec 20 2021 (cont)
• SUP 4: $68.31 - 1.236 proj of the Nov 7 - 28 - Dec 1 price swing

Recent gains in Brent futures have highlighted a bullish corrective cycle. Price has recently tested resistance at $82.03, the 20-day EMA. A break of this level would signal potential for a stronger recovery and open the 50-day EMA, at $85.50. The broader trend outlook is bearish. A stronger reversal lower would signal the end of the correction and refocus attention on the Dec 9 low of $75.11 - the bear trigger.

WTI TECHS: (G3) Trading Below Resistance

• RES 4: $88.10 - High Nov 11
• RES 3: $83.27 - High Dec 1
• RES 2: $79.79 - 50-day EMA
• RES 1: $76.80/77.83 - 20-day EMA / High Dec 15
• PRICE: $76.16 @ 07:05 GMT Dec 21
• SUP 1: $73.33/70.31 - Low Dec 13 / 9 and the bear trigger
• SUP 2: $68.19 - 1.236 proj of the Aug 30 - Sep 28 - Nov 7 price swing
• SUP 3: $65.47 - 1.382 proj of the Aug 30 - Sep 28 - Nov 7 price swing
• SUP 4: $63.28 - 1.50 proj of the Aug 30 - Sep 28 - Nov 7 price swing

Trend conditions in WTI futures remain bearish. Recent gains however, have highlighted a bullish corrective cycle and this has resulted in a test of the 20-day EMA, at $76.80 today. A clear break of this hurdle would signal scope for an extension and open $79.79, the 50-day EMA. On the downside, a stronger reversal lower would refocus attention on the bear trigger which lies at $70.31, the Dec 9 low.

GOLD TECHS: Bullish Sequence Intact

• RES 4: $1909.8 - High May 5
• RES 3: $1842.7 - 50.0% retracement of the Mar - Sep bear leg
• RES 2: $1833.0 - High Jun 29
• RES 1: $1824.5 - High Dec 13 and the bull trigger
• PRICE: $1813.3 @ 07:20 GMT Dec 21
• SUP 1: $1779.6/65.9 - 20-day EMA / Low Dec 5
• SUP 2: $1748.5 - 50-day EMA
• SUP 3: $1729.0 - Low Nov 23 and key short-term support
• SUP 4: $1702.3 - Low Nov 9

Trend conditions in Gold remain bullish and the recent move lower is considered corrective. Key short-term support to watch is $1765.9, Dec 5 low. The yellow metal breached $1810.0 last week, Dec 5 high, to resume the uptrend. This maintains the positive price sequence of higher highs and higher lows and opens $1842.7, a Fibonacci retracement. On the downside, a break of $1765.9 would signal scope for a deeper pullback.

SILVER TECHS: Fresh Trend High

• RES 4: $26.002 - High Apr 19
• RES 3: $25.293 - High Apr 20
• RES 2: $24.729 - 76.4% retracement of the Mar - Sep bear leg
• RES 1: $24.299 - Intraday high
• PRICE: $23.943 @ 08:02 GMT Dec 21
• SUP 1: $22.557 - Low Dec 16 and key short-term support
• SUP 2: $21.616 - 50-day EMA
• SUP 3: $20.872 - Low Nov 28
• SUP 4: $20.585 - Low Nov 21

The trend outlook in Silver remains bullish and moving average studies are in a bull mode position. Furthermore, this week’s fresh trend highs highlights a continuation of the bull cycle and maintains the positive price sequence of higher highs and higher lows. The focus is on $24.729, a Fibonacci retracement. Key short-term support has been defined at $22.557, the Dec 16 low.