MNI DAILY TECHNICAL ANALYSIS - EUR Confirms Continuation Lower Inside Bear Channel

Price Signal Summary – EUR Confirms Continuation Lower Inside Bear Channel

• The trend direction in the S&P E-Minis remains down and price is trading closer to recent lows. The contract has recently broken below the 50-day EMA. This reinforces the bearish theme and signals scope for a continuation, with attention on 3902.01 next, a Fibonacci retracement. EUROSTOXX 50 futures remain bearish and are starting the week on a softer note, as it trades below last week’s low. The contract has cleared 3456.00, the 76.4% retracement of the Jul 5 - Aug 17 rally.
• EURUSD is trading lower this morning and has traded through support at 0.9901, the Aug 23 low. The break lower confirms a resumption of the downtrend and sets the scene for a continuation lower inside the bear channel, drawn from the Feb 10 high. The USDJPY trend needle still points north following strong gains last week. The climb reinforced current bullish conditions and has put prices well north of former resistance at 139.39, the Jul 14 high. A bearish theme in AUDUSD remains intact and the pair is trading at its recent lows. The extension lower last week strengthens bearish conditions and confirms a resumption of the bear leg that started Aug 11.
• Gold remains in a clear short-term downtrend and last week’s extension reinforces a bearish condition. Support at $1727.8, Aug 22 low has been breached to confirm a resumption of the bear cycle. A bearish threat in WTI futures remains present following last week’s sharp sell-off. A strong reversal pattern appeared on the daily chart - a bearish engulfing candle on Aug 30.
• Bund futures remain in bear mode following last week's extension lower. Short-term gains are considered corrective. Price is through 147.94, 61.8% of the Jun 16 - Aug 2 bull leg. Gilt futures remain vulnerable and the bearish impulsive run that started early August, remains intact. The breach last week of support at 108.94, the Aug 24 low, confirmed a resumption of the downtrend and this also resulted in a print below the 107.00 handle.

FOREIGN EXCHANGE

EURUSD TECHS: Trades Below Key Support To Resume Downtrend

• RES 4: 1.0268 High Aug 15
• RES 3: 1.0193 High Aug 18 and Channel top from the Feb 10 high
• RES 2: 1.0090 High Aug 26 and key near-term resistance
• RES 1: 0.9951/1.0057 Intraday low / 20-day EMA
• PRICE: 0.9888 @ 06:10 BST Sep 5
• SUP 1: 0.9883 1.764 proj of Jun 9-15-27 swing
• SUP 2: 0.9800 Round number support
• SUP 3: 0.9785 2.00 projection of the Jun 9 - 15 - 27 price swing
• SUP 4: 0.9655 Channel base drawn from the Feb 10 high

EURUSD is trading lower this morning and has traded through support at 0.9901, the Aug 23 low. The break lower confirms a resumption of the downtrend and sets the scene for a continuation lower inside the bear channel, drawn from the Feb 10 high. The move lower also maintains the bearish price sequence of lower lows and lower highs. This opens the 0.9800 handle next.

GBPUSD TECHS: Oversold But Still Heading South

• RES 4: 1.2080 High Aug 18
• RES 3: 1.2000 50-day EMA
• RES 2: 1.1816/1901 20-day EMA / High Aug 26 and key resistance
• RES 1: 1.1624/1760 High Sep 1 / Low Jul 14 and recent breakout lvl
• PRICE: 1.1454@ 06:20 BST Sep 5
• SUP 1: 1.1412 Low Mar 20 2020 and a major support
• SUP 2: 1.1324 1.50 proj of the Jun 16 - Jul 14 - Aug 1 price swing
• SUP 3: 1.1300 Round number support
• SUP 4: 1.1248 1.618 proj of the Jun 16 - Jul 14 - Aug 1 price swing

The current downtrend in GBPUSD remains intact and the pair is trading lower once again, as it starts the week on a bearish note. The move lower maintains the current bearish sequence of lower lows and lower highs. The trend has entered oversold territory however this does not appear to be a concern for bears. The focus is on 1.1412 next, the Mar 20 2020 low and a major support. Initial firm resistance is seen at 1.1816, the 20-day EMA.

EURGBP TECHS: Bullish Outlook

• RES 4: 0.8840 High Feb 2
• RES 3: 0.8811 1.236 proj of the Apr 14 - Jun 15 - Aug 2 price swing
• RES 2: 0.8721 High Jun 15 and a medium-term bull trigger
• RES 1: 0.8679/99 High Jul 1 / 2.0% 10-dma envelope
• PRICE: 0.8634 @ 06:24 BST Sep 5
• SUP 1: 0.8572 Low Aug 31
• SUP 2: 0.8513 20-day EMA
• SUP 3: 0.8491 50-day EMA
• SUP 4:0.8408 Low Aug 23

EURGBP is holding on to the bulk of last week’s gains and a bull theme remains intact. The cross has recently cleared a number of short-term resistance points and attention is on 0.8679, the Jul 1 high. Clearance of this latter level would expose the key resistance at 0.8721, the Jun 15 high and an important bull trigger. On the downside, initial support is seen at 0.8572, the Aug 31 low.

USDJPY TECHS: Trend Needle Still Points North

• RES 4: 144.00 Round number resistance
• RES 3: 143.30 2.23 proj of the Aug 2 - 8 - 11 price swing
• RES 2: 142.08 2.00 proj of the Aug 2 - 8 - 11 price swing
• RES 1: 140.86 1.764 proj of the Aug 2 - 8 - 11 price swing
• PRICE: 140.38 @ 06:35 BST Sep 5
• SUP 1: 138.86/05 Low Sep 1 / Low Aug 30
• SUP 2: 137.20 20-day EMA
• SUP 3: 135.60 50-day EMA
• SUP 4: 134.65 Low Aug 18

The USDJPY trend needle still points north following strong gains last week. The climb reinforced current bullish conditions and has put prices well north of former resistance at 139.39, the Jul 14 high. Last week’s break higher also confirmed a resumption of the primary uptrend and maintains the broader bullish price sequence of higher highs and higher lows. Sights are on 140.86 next, a Fibonacci projection. Initial firm support is at 137.20, the 20-day EMA.

EURJPY TECHS: Corrective Pullback

• RES 4: 142.32 High Jul 21 and key resistance
• RES 3: 141.92 1.382 pro of the Aug 2 - 10 - 16 price swing
• RES 2: 141.19 1.236 pro of the Aug 2 - 10 - 16 price swing
• RES 1: 139.55/140.75 Intraday high / High Sep 2 and a bull trigger
• PRICE: 138.74 @ 06:40 BST Sep 5
• SUP 1: 137.97 50-day EMA
• SUP 2: 137.03 Low Aug 29
• SUP 3: 136.02 Low Aug 25
• SUP 4: 135.52 Low Aug 24

EURJPY is trading lower today. For now, a short-term pullback is considered corrective. A bullish theme remains intact following last week’s price developments and the breach of a trendline drawn from the Jun 28 high. The break strengthens bullish conditions and highlights a stronger reversal from the Aug 2 low. This has opened 141.19 next, a Fibonacci projection and 142.32, the Jul 21 high. Initial firm support is at 137.97, the 50-day EMA.

AUDUSD TECHS: Bear Trend Exposes Key Support

• RES 4: 0.7040 High Aug 16
• RES 3: 0.7009 High Aug 26 and a key short-term resistance
• RES 2: 0.6940 50-day EMA
• RES 1: 0.6855/6904 High Sep 2 / 20-day EMA
• PRICE: 0.6784 @ 06:59 BST Sep 5
• SUP 1: 0.6771 Low Sep 1
• SUP 2: 0.6719 Low Jul 15
• SUP 3: 0.6682 Low Jul 14 and the bear trigger
• SUP 4: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing

A bearish theme in AUDUSD remains intact and the pair is trading at its recent lows. The extension lower last week strengthens bearish conditions and confirms a resumption of the bear leg that started Aug 11. Price has breached 0.6789, 76.4% of the Jul 14 - Aug 11 upleg. This opens 0.6682, the Jul 14 low and a key support. On the upside, key short-term resistance is unchanged at 0.7009, Aug 26 high.

USDCAD TECHS: Key Resistance Remains Exposed

• RES 4: 1.3300 High Nov 4 2020
• RES 3: 1.3292 2.0% 10-dma envelope
• RES 2: 1.3224 High Jul 14 and key resistance
• RES 1: 1.3208 High Sep 1
• PRICE: 1.3154 @ 07:23 BST Sep 5
• SUP 1: 1.3063/1.2997 High Aug 23 / 20-day EMA
• SUP 2: 1.2932 50-day EMA
• SUP 3: 1.2895 Low Aug 25 and key near-term support
• SUP 4: 1.2828 Low Aug 17

The USDCAD bull theme remains intact and short-term pullbacks are considered corrective. Attention is on 1.3224, a key resistance and the Jul 14 high. A break would represent an important bullish development. Note that moving average studies are in a bull mode set-up, highlighting a broader uptrend. Initial firm support is at 1.2895. A break would alter the picture. First support lies at 1.3063, the Aug 23 high and a recent breakout level.

FIXED INCOME

BUND TECHS: (U2) Trend Direction Still Down

• RES 4: 154.47 High Aug 18
• RES 3: 153.66 High Aug 19
• RES 2: 152.30 50-day EMA
• RES 1: 149.32/151.42 High Aug 30 / High Aug 25
• PRICE: 149.20 @ 05:24 BST Sep 5
• SUP 1: 146.78/50 Low Jun 30
• SUP 2: 145.14 Low Sep 1 and the bear trigger / Low Jun 29
• SUP 3: 144.72 Low Jun 28 and a key support
• SUP 4: 143.05 Low Jun 121

Bund futures remain in bear mode following last week's extension lower. Short-term gains are considered corrective. Price is through 147.94, 61.8% of the Jun 16 - Aug 2 bull leg. The break reinforces bearish conditions and sets the scene for a move towards 146.50 next, the Jun 30 low. On the upside, initial firm resistance is seen at 151.42, Aug 25 high. A break of this level is required to ease the current bearish threat.

BOBL TECHS: (U2) Corrective Bounce

• RES 4: 126.930 High Aug 17
• RES 3: 126.070 High Aug 18
• RES 2: 125.338 50-day EMA
• RES 1: 123.980/124.930 High Aug 30 / High Aug 25
• PRICE: 123.150 @ 05:16 BST Sep 2
• SUP 1: 122.610 Low Sep 1
• SUP 2: 122.022 76.4% retracement of the Jun 16 - Aug 2 rally
• SUP 3: 120.990 Low Jun 21
• SUP 4: 119.940 Low Jun 16

Bobl futures remain bearish and the latest bounce is considered corrective. Price last week cleared the 61.8% retracement of the Jun 16 - Aug 2 rally, at 123.309. This has strengthened bearish conditions and a continuation of the bear leg is likely. The focus is on 122.022 next, the 76.4% retracement. Key short-term resistance has been defined at 124.930, the Aug 25 high. A break of this level is required to ease bearish pressure.

SCHATZ TECHS: (U2) Trend Direction Remains Down

• RES 4: 109.393 50-day EMA
• RES 3: 109.330 High Aug 25 and key near-term resistance
• RES 2: 109.195 20-day EMA
• RES 1: 108.965 High Aug 30 and Sep 2
• PRICE: 108.945 @ 05:35 BST Sep 5
• SUP 1: 108.500/425 Low Aug 1 / Low Jun 28
• SUP 2: 108.336 76.4% retracement of the Jun 16 - Aug 2 upleg
• SUP 3: 108.105 Low Jun 22
• SUP 4: 108.025 Low Jun 21

Schatz futures recovered Friday. Short-term gains however are considered corrective and the trend remains down. This follows last week’s extension lower. The 50-day EMA has recently been cleared and this has resulted in the breach of a number of Fibonacci retracement levels, as the downtrend extends. The focus is on 108.425 next, the Jun 28 low. On the upside, initial firm resistance is seen at 109.330, the Aug 25 high.

GILT TECHS: (Z2) Bear Cycle Still In Play

• RES 4: 113.32 High Aug 18
• RES 3: 112.43 High Aug 22
• RES 2: 111.54 High Aug 23
• RES 1: 109.47/110.85 High Aug 31 / 26 and key near-term resistance
• PRICE: 107.19 @ Close Sep 5
• SUP 1: 106.68 Low Sep 2
• SUP 2: 106.54 1.236 projection of the Aug 22 - 24 - 26 price swing
• SUP 3: 106.03 1.382 projection of the Aug 22 - 24 - 26 price swing
• SUP 4: 105.62 1.50 projection of the Aug 22 - 24 - 26 price swing

Gilt futures remain vulnerable and the bearish impulsive run that started early August, remains intact. The breach last week of support at 108.94, the Aug 24 low, confirmed a resumption of the downtrend and this also resulted in a print below the 107.00 handle. Attention is on 106.54 next, a Fibonacci projection. Firm short-term resistance has been defined at 110.85, the Aug 26 high.

BTP TECHS: (U2) Bear Trend Remains Intact

• RES 4: 127.15 High Aug 17
• RES 3: 125.00 Round number resistance
• RES 2: 123.94 50-day EMA
• RES 1: 121.28/123.16 High Aug 30/25 and key near-term resistance
• PRICE: 120.23 @ Close Sep 2
• SUP 1: 118.26 Low Sep 1
• SUP 2: 117.88 Low Jun 17
• SUP 3: 117.46 76.4% retracement of the Jun 14 - Aug 11 upleg
• SUP 4: 115.72 Low Jun 16

Bearish conditions in BTP futures remain intact - last week's fresh lows reinforce the current bear cycle. Recent weakness resulted in a break of the 20- and 50-day EMAs and confirmed a break of trendline support drawn from the Jun 14 low. Last week’s move through support at 119.57, the Jul 21 low, reinforces the current bearish theme. The focus is on 117.46 next, a Fibonacci retracement. Initial firm resistance is seen at 123.16, Aug 25 high.

US 10YR FUTURE TECHS: (Z2) Needle Still Points South

• RES 4: 119-18 High Aug 17
• RES 3: 118-17+ 50-day EMA
• RES 2: 118-00/01+ High Aug 26 / 20-day EMA
• RES 1: 117-07+ High Aug 31
• PRICE: 116-19 @ 16:04 BST Sep 2
• SUP 1: 115-23 Low Sep 1
• SUP 2: 114-26 Low Jun 16
• SUP 3: 114-06 Low Jun 14 and a key support
• SUP 4: 114-00 Round number support

Treasuries remain vulnerable despite the modest bounce on Friday, with the bearish theme still intact for now. The recent breach of 117-11+, Jul 21 low, reinforced bearish conditions and the subsequent follow through has resulted in the break of 116-01+, 61.8% of the Jun 14 - Aug 2 rally. The break supports the case for a move back to 114-06, Jun 14 low. Initial firm resistance has been defined at 118-00, Aug 26 high.

EQUITIES

EUROSTOXX50 TECHS: (U2) Starting The Week On A Bearish Note

• RES 4: 3822/40.00 High Aug 17 / High Jun 6 and key resistance zone
• RES 3: 3782.00 High Aug 18
• RES 2: 3705.00 High Aug 26 and key near-term resistance
• RES 1: 3459.00/3627.60 High Sep 2 / 50-day EMA
• PRICE: 3438.00@ 05:46 BST Sep 5
• SUP 1: 3429.00 Intraday low
• SUP 1: 3386.00 Low Jul 15
• SUP 3: 3362.00 Low Jul 14
• SUP 4: 3343.00 Low Jul 5 and the key bear trigger

EUROSTOXX 50 futures remain bearish and are starting the week on a softer note, as it trades below last week’s low. The contract has cleared 3456.00, the 76.4% retracement of the Jul 5 - Aug 17 rally. The clear break strengthens bearish conditions and exposes key support at 3343.00, Jul 5 low. Clearance of 3343.00 would confirm a resumption of the broader downtrend. Initial resistance is seen at 3549.00, Friday's high.

E-MINI S&P (U2): Heading South

• RES 4: 4327.50 High Aug 16 and the bull trigger
• RES 3: 4288.00 High Aug 19
• RES 2: 4217.25 High Aug 26 and key short-term resistance
• RES 1: 4067.40 50-day EMA
• PRICE: 3925.25 @ 06:57 BST Sep 5
• SUP 1: 3902.01 61.8% retracement of the Jun 17 - Aug 16 upleg
• SUP 2: 3834.00 Low Jul 19
• SUP 3: 3801.49 76.4% retracement of the Jun 17 - Aug 16 upleg
• SUP 4: 3723.75 Low Jul 14

The trend direction in the S&P E-Minis remains down and price is trading closer to recent lows. The contract has recently broken below the 50-day EMA. This reinforces the bearish theme and signals scope for a continuation, with attention on 3902.01 next, a Fibonacci retracement. Clearance of this level would strengthen bearish conditions. Initial firm resistance is at 4067.40, the 50-day EMA.

COMMODITIES

BRENT TECHS: (X2) Bear Threat Still Present

• RES 4: $110.17 - High Jun 29
• RES 3: $107.30 - High Jul 5
• RES 2: $103.86 - High Jul 29 and key resistance
• RES 1: $98.11 - 50-day EMA
• PRICE: $95.00 @ 06:53 BST Sep 5
• SUP 1: $91.81 - Low Sep 1
• SUP 2: $90.95 - Low Aug 17
• SUP 3: $89.06 - Low Jul 14 and the key bear trigger
• SUP 4: $87.50 - Low Mar 15

Brent futures remain vulnerable following last week’s sharp reversal. A continuation lower would expose the next important support at $90.95, the Aug 17 low, ahead of $89.06, the Jul 14 low and a key bear trigger. Moving average studies continue to highlight a broader bear cycle. Key resistance is at $103.48, the Jul 29 high, where a break is needed to reinstate a bull theme.

WTI TECHS: (V2) Key Support Remains Exposed

• RES 4: $108.07 - High Jun 29
• RES 3: $105.00 - High Jul 5
• RES 2: $99.75 - High Jul 29 and key resistance
• RES 1: $93.48/97.66 - 50-day EMA / High Aug 30
• PRICE: $88.59 @ 07:02 BST Sep 5
• SUP 1: $85.98 - Low Sep 1
• SUP 2: $85.37 - Low Aug 16 and the bear trigger
• SUP 3: $84.10/00 - Low Mar 15 / Round number support
• SUP 4: $81.88 - Low Feb 25

A bearish threat in WTI futures remains present following last week’s sharp sell-off. A strong reversal pattern appeared on the daily chart - a bearish engulfing candle on Aug 30. This pattern suggests potential for a stronger sell-off near-term that initially exposes key support at $85.37, the Aug 16 low and a bear trigger. Firm resistance has been defined at $97.66, Aug 30 high, where a break is required to resume bullish activity.

GOLD TECHS: Downtrend Intact

• RES 4: $1783.2 - High Aug 16
• RES 3: $1765.5 - High Aug 25 and a key resistance
• RES 2: $1742.0 - 20-day EMA
• RES 1: $1726.6 - High Aug 31
• PRICE: $1711.5 @ 07:18 BST Sep 5
• SUP 1: $1681.0 - Low Jul 21 and the bear trigger
• SUP 2: $1676.9 - Low Mar 8 2021
• SUP 3: $1671.0 - Low Jun 5 2020
• SUP 4: $1657.1 - 0.764 proj of the Jun 13 - Jul 21 - Aug 10 swing

Gold remains in a clear short-term downtrend and last week’s extension reinforces a bearish condition. Support at $1727.8, Aug 22 low has been breached to confirm a resumption of the bear cycle. The break lower paves the way for weakness towards $1681.0, the Jul 21 low and a key bear trigger. A break would confirm a resumption of the broader downtrend that started early March. Initial firm resistance is seen at $1742.0, the 20-day EMA.

SILVER TECHS: Trend Direction Remains Down

• RES 4: $21.540 - High Jun 27
• RES 3: $20.876 - High Aug 15 and the bull trigger
• RES 2: $19.020/705- 20- and 50-day EMA values
• RES 1: $18.544 - High Aug 31
• PRICE: $18.121 @ 07:57 BST Sep 5
• SUP 1: $17.562 - Low Sep 1
• SUP 2: $16.955 - Low Jun 15 2020
• SUP 3: $16.473 - 1.00 proj of the Jun 6 - Jul 14 - Aug 10 price swing
• SUP 4: $15.998 - 76.4% retracement of the 2020 - 2021 bull leg

The Silver outlook remains bearish. Last week’s sell-off confirms a resumption of the bear leg that started Aug 15 - the metal has cleared support at $18.146, the Jul 14 low and bear trigger. The break lower also maintains the bearish price sequence of lower lows and lower highs. The focus is on $16.955 next, the Jun 15 2020 low. Initial firm resistance is seen at $18.544, the Aug 31 high.