MNI DAILY TECHNICAL ANALYSIS - EURGBP Outlook Remains Bullish

Price Signal Summary - EURGBP Outlook Remains Bullish

• S&P E-Minis reversed course Thursday having failed to clear resistance 4303.50, the Apr 26/28 high. The move lower reinforces underlying bearish conditions - the trend direction remains down. EUROSTOXX 50 futures remain in a bear mode. Recent short-term gains are considered corrective and support remains exposed. A bearish theme follows the reversal from the Apr 21 high of 3883.00 and note that price remains below the 50-day EMA.
• EURUSD reversed Wednesday’s gains on Thursday. The failure to hold on to recent gains highlights a shallow correction and recent activity appears to be a bear flag - a bearish continuation pattern. The EURGBP outlook remains bullish and the cross traded sharply higher Thursday, resulting in a breach of resistance at 0.8468, the Apr 27 high, and 0.8512, the Mar 31 high and a bull trigger. AUDUSD rallied Wednesday before wholly reversing the move into the Thursday close. Firm resistance is seen at 0.7292, the 50-day EMA where a clear break is required to suggest scope for a stronger recovery.
• Recent gains in Gold are considered corrective and 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 maintain 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, that has been probed.
• Trend signals in Bund futures continue to point south and fresh cycle lows reinforce this condition. The move lower confirms a resumption of the primary downtrend and an extension of the bearish price sequence of lower lows and lower highs. The Gilt futures 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: Bear Flag

• RES 4: 1.0936 High Apr 21 and a key resistance
• RES 3: 1.0852 High Apr 22
• RES 2: 1.0695/58 20-day EMA / Low Apr 14 - recent breakout level
• RES 1: 1.0655 High Apr 27
• PRICE: 1.0529 @ 06:11 BST May 6
• SUP 1: 1.0472/54 Low Apr 28 and the bear trigger / 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 reversed Wednesday’s gains on Thursday. The failure to hold on to recent gains highlights a shallow correction and recent activity appears to be a bear flag - a bearish continuation pattern. This reinforces the current bear cycle. 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 1.0695, the 20-day EMA.

GBPUSD TECHS: Resumes Its Downtrend

• RES 4: 1.2974 Low Apr 13 and a recent breakout level
• RES 3: 1.2877 High Apr 25
• RES 2: 1.2742/72 20-day EMA / High Apr 26
• RES 1: 1.2638 High May 4
• PRICE: 1.2361 @ 06:15 BST May 6
• SUP 1: 1.2325 Low May 5
• SUP 2: 1.2252 Low Jun 29 2020
• SUP 3: 1.2200 Round number support
• SUP 4: 1.2162 Low May 22 2020

A bearish risk in GBPUSD remains present following Thursday’s sharp sell-off. The break of 1.2412, Apr 28 low, confirms a recent shallow correction and a bear flag breakout on the daily frequency. The move also confirms a resumption of the downtrend and signals scope for weakness towards 1.2252 next, the Jun 29 2020 low. Key short-term resistance has been defined at 1.2638, the May 4 high.

EURGBP TECHS: Clears Resistance

• RES 4: 0.8624 High Oct 1 2021
• RES 3: 0.8596/8600 2.0% 10-dma envelope / High Dec 8 2021
• RES 2: 0.8553 High Dec 14 2020
• RES 1: 0.8546 High May 5
• PRICE: 0.8519 @ 06:31 BST May 6
• SUP 1: 0.8468 High Apr 27 and a recent breakout level
• SUP 2: 0.8379/67 50-day EMA / Low May 2
• SUP 3: 0.8313 Low Apr 22
• SUP 4: 0.8250 Low Apr 14 and a key support

The EURGBP outlook remains bullish and the cross traded sharply higher Thursday, resulting in a breach of resistance at 0.8468, the Apr 27 high, and 0.8512, the Mar 31 high and a bull trigger. This reinforces bullish conditions and signals scope for a climb towards the 0.8600 handle next. On the downside, key short-term support has been defined at 0.8367, the May 2 low. Initial support is seen at 0.8468.

USDJPY TECHS: Trend Conditions Remain Bullish

• 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: 130.63 @ 06:35 BST May 6
• SUP 1: 127.74 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 recent short-term dips are considered corrective. A bull flag on the daily chart reinforces the bullish theme. 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: Remains Above Support

• 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: 137.57 @ 06:40 BST May 6
• SUP 1: 134.79 Low Apr 27
• SUP 2: 134.67/30 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 remains in consolidation mode. The recent pullback is considered corrective and the trend direction is up. The cross is trading above key support highlighted by the 50-day EMA, The average intersects at 134.67, just above an important support at 134.30, Apr 5 low. While these supports hold, trend conditions remain bullish. Initial resistance is at 138.00, Apr 28 high. The bull trigger is unchanged at 140.00, Apr 21 high.

AUDUSD TECHS: Fails To Hold On To Its Gains

• RES 4: 0.7458 High Apr 20/21 and a key resistance
• RES 3: 0.7379 High Apr 22
• RES 2: 0.7292 50-day EMA
• RES 1: 0.7266 High May 4/5
• PRICE: 0.7098 @ 06:46 BST May 6
• SUP 1: 0.7030 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 before wholly reversing the move into the Thursday close. Firm resistance is seen at 0.7292, the 50-day EMA where a clear break is required to suggest scope for a stronger recovery. Recent short-term gains are considered corrective. A continuation lower would refocus attention on Monday’s low of 0.7030. This level has been defined as key support and the bear trigger.

USDCAD TECHS: Remains Above The 50-Day EMA

• RES 4: 1.3061 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: 1.2914 High May 2 and the bull trigger
• PRICE: 1.2843 @ 06:50 BST May 6
• SUP 1: 1.2714/2681 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 bounced firmly into the Thursday close. This week’s pullback is considered corrective and the broader trend needle continues to point north. Key short-term support lies at the 50-day EMA, at 1.2681, 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 and the next bull trigger.

FIXED INCOME

BUND TECHS: (M2) Fresh Cycle Low

• RES 4: 158.01 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: 154.92 20-day EMA
• PRICE: 152.48 @ 05:11 BST May 6
• SUP 1: 152.15 Low May 5
• 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 fresh cycle lows reinforce this condition. The move lower confirms a resumption of the primary downtrend and an extension of the bearish price sequence of lower lows and lower highs. Moving average studies remain in a 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) Trend Needle Still Points South

• 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: 127.700 20-day EMA
• PRICE: 126.770 @ 05:17 BST May 6
• 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 traded lower Thursday. Trend conditions remain bearish. Fresh cycle lows in April, and again on Wednesday, 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: 110.796 50-day EMA
• RES 3: 110.855 High Apr 4
• RES 2: 110.540 High Apr 28 and a key resistance
• RES 1: 110.400 20-day EMA
• PRICE: 110.135 @ 05:17 BST May 6
• 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 remains down. Wednesday’s fresh cycle low reinforces this condition. The move lower confirms a continuation 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: 120.96 High Apr 6
• RES 2: 120.45 50-day EMA
• RES 1: 119.79 High Apr 25 and a key short-term resistance
• PRICE: 118.06 @ Close May 5
• 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

The Gilt futures 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) Bear Trend Extension

• RES 4: 136.12 High Apr 7
• RES 3: 135.97 50-day EMA
• RES 2: 135.23 High Apr 14
• RES 1: 132.15/133.53 20-day EMA / High Apr 28
• PRICE: 127.81 @ Close May 5
• SUP 1: 127.51 Intraday low
• SUP 2: 125.88 2.236 proj of the Mar 31 - Feb 16 - Mar 1 price swing
• SUP 3: 125.02 1.236 proj of the Mar 1 - 29 - 31 price swing
• SUP 4: 124.02 Low Mar 18 2020 (cont) and a major support

The trend condition in BTP futures remains bearish - another round of weakness yesterday resulted in a fresh 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 125.88 next, a Fibonacci projection. Firm short-term resistance has been defined at 133.53, the Apr 28 high.

EQUITIES

EUROSTOXX50 TECHS: (M2) Still In Bear Mode

• 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: 3784.90/3883.00 50-day EMA / High Apr 21
• PRICE: 3638.00 @ 05:46 BST May 6
• 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 remain in a bear mode. Recent short-term gains are considered corrective and support remains exposed. A bearish theme follows the reversal from the Apr 21 high of 3883.00 and note that price remains below the 50-day EMA. The breach, on Apr 25, of support at 3684.00, Apr 12 low, has also reinforced a bearish condition. Resistance to watch is; 3784.90, the 50-day EMA and 3883.00, the Apr 21 high. The bear trigger is 3608.00.

E-MINI S&P (M2): Eyeing Support

• RES 4: 4588.75 High Apr 5
• RES 3: 4509.00 High Apr 21 and a key short-term resistance
• RES 2: 4366.33 50-day EMA
• RES 1: 4303.50/4355.50 High Apr 26/28 / Low Apr 18
• PRICE: 4139.50 @ 06:52 BST May 6
• SUP 1: 4056.00 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 reversed course Thursday having failed to clear resistance 4303.50, the Apr 26/28 high. The move lower reinforces underlying bearish conditions - the trend direction remains down. Attention is Monday’s low of 4056.00 where a break would confirm a resumption of the downtrend and pave the way for a sell-off towards the 4000.00 handle. A break of 4303.50 is required to alter the short-term picture.

COMMODITIES

BRENT TECHS: (N2) Trades Through Triangle Resistance

• RES 4: $123.44 - High Mar 8
• RES 3: $121.13 - 76.4% retracement of the Mar 7 - 15 downleg
• RES 2: $115.76 - High Mar 24 and a bull trigger
• RES 1: $114.00 - High May 5
• PRICE: $111.37 @ 07:01 BST May 6
• SUP 1: $106.57 - 20-day EMA
• SUP 2: $103.10/99.25 - Low May 2 / Low Apr 25
• SUP 3: $97.18 - Low Apr 11
• SUP 4: $92.59 - Low Mar 15 and a key support

Brent futures maintain this week’s bullish tone. The contract traded above triangle resistance yesterday at 111.86. The pattern is drawn from the Mar 15 low. The break higher signals scope for a stronger recovery and resistance at 113.61, Apr 18 high has been probed. A clear break would open $115.76, the Mar 24 high. On the downside, initial firm support is seen at $103.10, a break would be bearish.

WTI TECHS: (M2) Triangle Breakout Highlights Bullish Theme

• 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: $111.37 - High May 5
• PRICE: $108.98 @ 07:11 BST May 6
• SUP 1: $103.44 - 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 maintain 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, that has been probed. A clear break would signal scope for a continuation higher and open $113.51, the Mar 24 high. Initial firm support lies at $100.28, the May 2 low. A break of this support would be bearish.

GOLD TECHS: Bearish Focus

• 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: $1910.4 - 20-day EMA
• PRICE: $1875.7 @ 07:15 BST May 6
• 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

Recent gains in Gold are considered corrective and 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, $1910.4, the 20-day EMA is seen as a firm S/T resistance.

SILVER TECHS: Approaching Key Support

• 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: $23.775/24.284 - 20-day EMA / 50-day EMA
• PRICE: $22.345 @ 07:54 BST May 6
• SUP 1: $22.104 - Intraday low
• 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. This week’s fresh lows have reinforced bearish conditions. Support at $23.974, Mar 29 low and $23.173, 76.4% of the Feb 3 - Mar 8 rally, have recently 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 $24.215 marks a firm resistance. Short-term gains would be considered corrective.