MNI DAILY TECHNICAL ANALYSIS - EStoxx Tops Historical and Trend Resistance

Price Signal Summary – EStoxx Tops Historical and Trend Resistance

• In the equity space, bearish pressure in the S&P E-minis has eased significantly this week and the contract rallied sharply higher yesterday. Futures are once again back above the 50-day EMA, at 4569.94 today. EUROSTOXX 50 futures rallied sharply higher yesterday. The contract has breached resistance at 4186.00, the Dec 1 high and price has traded through both the 20- and 50-day EMAs.
• In FX, EURUSD remains below last week’s high. The pair traded lower again yesterday, before finding support at 1.1228. Key short-term resistance is unchanged at 1.1383, Nov 30 high. GBPUSD is consolidating. The pair remains weak and attention is on 1.3195, Nov 30 low. This level represents an important short-term support and bear trigger following the volatile nature of price action early last week. USDJPY started the week on a firm note and is holding onto this week’s gains. Monday’s price action appears to be a bullish engulfing reversal. If correct, it suggests the pair has found a base at the recent low of 112.53 on Nov 30.
• On the commodity front, Gold remains above last week’s lows. Short-term conditions are still 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 is on the base of a bull channel at $1763.8 today. Last week’s rebound in WTI has resulted in a stronger short-term recovery. On the 60-min chart, the move higher this week has confirmed an inverted head and shoulder reversal.
• In the FI space, Bund futures remain in an uptrend and the contract is trading closer to recent highs. The current bull phase has been in place since Oct 29 and a bullish price sequence of higher highs and higher lows remains intact. Gilt futures maintain a bullish tone and traded higher yesterday. This maintains a bullish price sequence of higher highs and higher lows, reinforcing current conditions.

FOREIGN EXCHANGE

EURUSD TECHS: Holding Above Yesterday’s Low

• RES 4: 1.1692 High Oct 28
• RES 3: 1.1564 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: 1.1294 @ 06:17 GMT Dec 8
• SUP 1: 1.1228 Low Dec 07
• 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 last week’s high. The pair traded lower again yesterday, before finding support at 1.1228. Key short-term resistance is unchanged at 1.1383, Nov 30 high where a break would signal scope for a stronger corrective bounce and open 1.1514, Nov 5 high. The broader trend is bearish though with the bear trigger at 1.1186/85. Moving average studies remain in bear mode.

GBPUSD TECHS: Eyeing Key Near-Term Resistance

• 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: 1.3366/70 20-day EMA / High Nov 30
• PRICE: 1.3255 @ 06:21 GMT Dec 8
• 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: 1.3027 2.0% 10-dma envelope

GBPUSD is consolidating. The pair remains weak and attention is on 1.3195, Nov 30 low. This level represents an important short-term support and bear trigger following 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. Resistance is seen at 1.3366, the 20-day EMA. A break would signal a potential short-term base.

EURGBP TECHS: Short-Term Outlook Remains Bullish

• 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 High Dec 6
• PRICE: 0.8520 @ 06:25 GMT Dec 8
• SUP 1: 0.8485 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 traded lower Monday and has erased Friday’s gains. Short-term trend conditions are unchanged though and conditions remain bullish. The recent breach of 0.8544, 76.4% of the Nov 5 - 22 sell-off suggests scope for an extension towards a key short-term resistance at 0.8595, the Nov 5 high. The first support to watch is 0.8483. A clear break would signal a potential top and allow for a deeper sell-off.

USDJPY TECHS: Bullish Engulfing Reversal Still In Play

• RES 4: 116.09 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 3: 115.52 High Nov 24 and the bull trigger
• RES 2: 114.38 61.8% of the Nov 24 - 30 downleg
• RES 1: 113.96 High Nov 29
• PRICE: 113.53 @ 06:28 GMT Dec 8
• SUP 1: 112.53 Low Nov 30 and the bear trigger
• 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 started the week on a firm note and is holding onto this week’s gains. Monday’s price action appears to be a bullish engulfing reversal. If correct, it suggests the pair has found a base at the recent low of 112.53 on Nov 30. The 20-day EMA at 113.70 is being tested. A clear break would reinforce the pattern and suggest scope for a climb towards the November high of 115.52. Sub 112.53 levels would instead reinstate a bearish threat.

EURJPY TECHS: Gains Considered Corrective

• RES 4: 131.59 High Nov 5
• RES 3: 129.99 High Nov 19
• RES 2: 129.78 50-day EMA
• RES 1: 128.79/129.60 High Dec 1 / High Nov 23 and key resistance
• PRICE: 128.18 @ 06:35 GMT Dec 8
• SUP 1: 127.39 Low Dec 3 / Dec 6 and the bear trigger
• 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 short-term gains are considered corrective and the downtrend remains intact. 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 moving average studies still point south suggesting potential for a deeper decline further out. Key short-term resistance is at 129.60, Nov 23 high. A break would signal a reversal.

AUDUSD TECHS: Corrective Bounce Extends

• RES 4: 0.7284 Former channel base drawn from the Aug 20 low
• RES 3: 0.7209 High Nov 25
• RES 2: 0.7187 20-day EMA
• RES 1: 0.7143 Intraday high
• PRICE: 0.7126 @ 06:44 GMT Dec 8
• SUP 1: 0.7040/6991 Low Dec 7 / Low Nov 2 2020 and a key support
• SUP 2: 0.6963 Low Jul 16 2020
• SUP 3: 0.6921 Low Jul 14 2020
• SUP 4: 0.6759 50% 2020 - 2021 Rally

This week’s bounce in AUDUSD has extended and the pair is back above the 0.7100 handle. The move higher signals scope for a climb towards 0.7187, the 20-day EMA. A clear breach of this average would strengthen the current bull phase. The broader trend condition is bearish though. A reversal lower would refocus attention on 0.6991, Nov 2 low and the bear trigger. Clearance of this level would confirm a resumption of the downtrend.

USDCAD TECHS: Strong Reversal

• RES 4: 1.3004 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: 1.2768/2854 High Dec 7 / High Dec 3 and the bull trigger
• PRICE: 1.2656 @ 06:54 GMT Dec 8
• SUP 1: 1.2633/22 Intraday low / 1.0% 10-dma Envelope
• SUP 2: 1.2599 50-day EMA
• SUP 3: 1.2571 50.0% of the Oct 21 - Dec 3 rally
• SUP 4: 1.2493 Low Nov 16

USDCAD has reversed lower this week. The sharp pullback has resulted in a break of the 20-day EMA and has exposed the 50-day EMA at 1.2599. Clearance of this latter EMA would signal scope for deeper pullback and open 1.2571, a Fibonacci retracement. Yesterday’s high of 1.2768 marks the first resistance. A break would ease bearish pressure and attention would turn to the key resistance at 1.2854, Dec 3 high.

FIXED INCOME

BUND TECHS: (H2) Bullish Trend Conditions Intact

• 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 and the bull trigger
• PRICE: 174.51 @ 04:58 GMT Dec 8
• 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 remain in an uptrend and the contract is trading closer to recent highs. The current bull phase has been in place since Oct 29 and a bullish price sequence of higher highs and higher lows remains intact, the definition of an uptrend. 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. Key support is at 171.77, Nov 24 low.

BOBL TECHS: (H2) Consolidating

• 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: 134.150 @ 05:03 GMT Dec 8
• 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

The Bobl futures outlook is unchanged and trend conditions remain bullish. 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. Recent consolidation appears to be a pause in the trend. The focus is on a climb towards 134.740 next, a Fibonacci projection. Key S/T support has been defined at 133.730.

SCHATZ TECHS: (H2) Key Short-Term Support Intact

• 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: 112.155 @ 05:12 GMT Dec 8
• SUP 1: 112.140 Low Dec 1 and key near-term support
• SUP 2: 112.109 0.764 proj of the Nov 26 - Dec 1 - Dec 3 price swing
• SUP 3: 112.100 Round number support
• SUP 4: 112.070 1.000 proj of the Nov 26 - Dec 1 - Dec 3 price swing

Schatz futures outlook remains bullish despite the continued pullback from recent highs. The contract recently probed resistance at 112.300, Nov 22 high. A clear break 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 to watch lies at 112.140, Dec 1 / 7 low. Clearance of this level would alter the short-term outlook and instead expose 112.100.

GILT TECHS: (H2) Uptrend Remains Intact

• RES 4: 128.00 High Aug 31
• RES 3: 127.69 High Sep 3
• RES 2: 127.36 High Sep 7
• RES 1: 127.28 High Dec 7
• PRICE: 127.20 @ Close GMT Dec 7
• 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 traded higher yesterday. This maintains a bullish price sequence of higher highs and higher lows, reinforcing current conditions. The 127.00 objective has been cleared and the focus is on 127.36, 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 lies at 125.44, the Nov 26 low.

BTP TECHS: (H2) Trend Needle Points North

• RES 4: 152.71 1.00 proj of the Nov 1 - 22 - 24 price swing
• RES 3: 151.45 0.764 proj of the Nov 1 - 22 - 24 price swing
• RES 2: 151.00 Round number resistance
• RES 1: 150.66 High Dec 6
• PRICE: 150.02 @ Close GMT Dec 7
• SUP 1: 149.14/148.25 Low Dec 3 / 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 started the week on a firm note and tested territory just above the 159.64 key resistance and bull trigger, the Nov 22 high. The climb reinforces short-term bullish conditions following the recent recovery from 147.36, Nov 24 low. A clear break of 159.64 would confirm a resumption of the uptrend that started early November and open 151.00. Initial firm support is seen at 148.25, Dec 1 low.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Is Back Above Key EMAs

• RES 4: 4461.00 1.50 proj of the Jul 19 - Sep 6 - Oct 6 price swing
• RES 3: 4420.80 1.382 proj of the Jul 19 - Sep 6 - Oct 6 price swing
• RES 2: 4409.50 High Nov 18 and the bull trigger
• RES 1: 4311.70 76.4% retracement of the Nov 18 - 30 downleg
• PRICE: 4272.00 @ 05:40 GMT Dec 8
• SUP 1: 4137.00 Intraday low
• SUP 2: 4053.50/3995.00 Low Dec 3 / Low Nov 30
• SUP 2: 3949.50 Low Oct 6 and bear trigger3:
• SUP 4: 3882.00 Low Jul 19

EUROSTOXX 50 futures rallied sharply higher yesterday. The contract has breached resistance at 4186.00, the Dec 1 high and price has traded through both the 20- and 50-day EMAs. The focus is on 4311.70, the 76.4% retracement of the recent downleg between Nov 18 - 30. A break of this level would open 4409.50, the Nov 18 high and key resistance. Yesterday’s low of 4137.00 marks initial support. The key support lies at 3995.00, Nov 30 low.

E-MINI S&P (Z1): Eyeing The ATH

• RES 4: 4800.00 Round number resistance
• RES 1: 4788.95 0.618 proj of the Oct 1 - Nov 22 - Dec 3 price swing
• RES 2: 4740.50 High Nov 22 and the bull trigger
• RES 1: 4717.00 High Nov 26
• PRICE: 4698.00 @ 07:04 GMT Dec 8
• SUP 1: 4587.25 Low Dec 8
• SUP 2: 4492.00 Low Dec 3
• SUP 3: 4443.55 61.8% retracement of the Oct 1 - Nov 22 rally
• SUP 4: 4373.40 76.4% retracement of the Oct 1 - Nov 22 rally

Bearish pressure in the S&P E-minis has eased significantly this week and the contract rallied sharply higher yesterday. Futures are once again back above the 50-day EMA, at 4569.94 today. This average highlights a pivot area and a stronger recovery through it would improve conditions for bulls. The focus is on 4717.00 next, the Nov 26 high ahead of the all-time high of 4740.50. Key support and the bear trigger is at 4492.00, the Dec 3 low.

COMMODITIES

BRENT TECHS: (G2) Rally Extends

• RES 4: $81.88 - High Nov 24
• RES 3: $80.42 - High Nov 26
• RES 2: $77.34 - 50-day EMA
• RES 1: $76.27 - High Dec 7
• PRICE: $74.99 @ 07:09 GMT Dec 8
• SUP 1: $73.20 - Low Dec 7
• SUP 2: $69.24/65.72 - Low Dec 3 / Low Dec 2 and the bear trigger
• SUP 3: $62.95 - Low Aug 23 and a key support
• SUP 4: $62.54 - Low May 21

Brent futures traded higher again yesterday, extending the sharp bounce from $65.72, the Dec 2 low. On the 60-min chart, the move higher this week has confirmed an inverted head and shoulders reversal suggesting scope for stronger gains near-term. The move higher though is considered corrective and this is allowing a recent oversold condition to unwind. Attention is on $77.27, the 50-day EMA. Initial firm support lies at $69.24, the Dec 3 low.

WTI TECHS: (F2) Corrective Rally Still In Play

• RES 4: $80.68 - High Nov 16
• RES 3: $78.65 - High Nov 26
• RES 2: $74.89 - 50-day EMA
• RES 1: $73.07 - 20-day EMA
• PRICE: $71.35 @ 07:28 GMT Dec 8
• SUP 1: $65.60 - Low Dec 3
• SUP 2: $62.43 - Low Dec 2 and the bear trigger
• SUP 3: $60.77 - Low Aug 23 and a key support
• SUP 4: $59.63 - Low May 20

Last week’s rebound in WTI has resulted in a stronger short-term recovery. On the 60-min chart, the move higher this week has confirmed an inverted head and shoulder reversal, reinforcing the current bull cycle and suggesting scope for stronger gains near-term. The climb is considered corrective though and is allowing a recent oversold condition to unwind. Attention is on $73.07 next, the 20-day EMA. Initial firm support lies at $65.60, the Dec 3 low.

GOLD TECHS: Eyeing 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: $1788.7 @ 07:23 GMT Dec 8
• SUP 1: $1763.8/62.0 - Bull Channel base from Aug 9 / Low Dec 2
• SUP 2: $1759.0 - Low Nov 3
• SUP 3: $1721.7 - Low Sep 29
• SUP 4: $1690.6 - Low Aug 9

Gold remains above last week’s lows. Short-term conditions are still 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 is on the base of a bull channel at $1763.8 today. The channel is drawn off the Aug 9 low and represents an important support. A breakout would strengthen bearish conditions. Initial firm resistance to watch is at $1815.6, the Nov 26 high.

SILVER TECHS: Consolidating

• 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: $22.452 @ 07:22 GMT Dec 7
• 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

Silver is consolidating and the 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.