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MNI DAILY TECHNICAL ANALYSIS - EURGBP Overbought Setup Unwinds

MNI (LONDON) - Price Signal Summary – EURGBP Overbought Condition Unwinds

  • S&P E-Minis traded higher yesterday and the contract maintains a firmer tone. The rally this week has resulted in a break of the 50-day EMA. This highlights a stronger reversal and signals the end of the corrective cycle between Jul 16 - Aug 5. Eurostoxx 50 futures traded sharply higher Thursday, extending the recovery that started Aug 5. The contract has traded through the 20-day EMA and attention is on resistance at the 50-day EMA, at 4866.79.
  • A bullish theme in EURUSD remains intact despite Thursday’s move lower. The pair traded higher Tuesday and Wednesday, extending this week’s bull phase. Resistance at 1.1008, the Aug 5 high, has been cleared and this confirms a resumption of the uptrend. EURGBP has traded lower this week, marking an extension on the current corrective cycle. A retracement is allowing an overbought condition to unwind. First support to watch is 0.8516, the 20-day EMA. A firmer support lies at the 50-day EMA, at 0.8494.AUDUSD continues to trade at its recent highs. From a short-term perspective, the latest recovery still appears to be a correction, however, price has traded through both the 20- and 50-day EMAs.
  • Gold is unchanged and the metal is holding on to its latest gains. Recent weakness appears to be corrective and the trend structure remains bullish. Note that price recently pierced support at the 50-day EMA - currently at $2391.6.WTI futures rallied sharply higher Monday. The move undermines a recent bearish theme and price has traded through both the 20- and 50-day EMAs. A resumption of gains would signal scope for a climb towards $80.77, a Fibonacci retracement.
  • A bullish trend condition in Bund futures remains intact and recent gains reinforce this theme. 133.21, Jun 14 high, was cleared on Jul 29, confirming a resumption of the uptrend. Note that MA studies are in a bull-mode position too. The trend condition in Gilt futures remains bullish and the latest pullback appears to have been a correction. Note that the move lower has allowed an overbought trend reading to unwind. A resumption of gains would signal scope for a climb towards 101.78. 

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MNI (LONDON) - Price Signal Summary – EURGBP Overbought Condition Unwinds

  • S&P E-Minis traded higher yesterday and the contract maintains a firmer tone. The rally this week has resulted in a break of the 50-day EMA. This highlights a stronger reversal and signals the end of the corrective cycle between Jul 16 - Aug 5. Eurostoxx 50 futures traded sharply higher Thursday, extending the recovery that started Aug 5. The contract has traded through the 20-day EMA and attention is on resistance at the 50-day EMA, at 4866.79.
  • A bullish theme in EURUSD remains intact despite Thursday’s move lower. The pair traded higher Tuesday and Wednesday, extending this week’s bull phase. Resistance at 1.1008, the Aug 5 high, has been cleared and this confirms a resumption of the uptrend. EURGBP has traded lower this week, marking an extension on the current corrective cycle. A retracement is allowing an overbought condition to unwind. First support to watch is 0.8516, the 20-day EMA. A firmer support lies at the 50-day EMA, at 0.8494.AUDUSD continues to trade at its recent highs. From a short-term perspective, the latest recovery still appears to be a correction, however, price has traded through both the 20- and 50-day EMAs.
  • Gold is unchanged and the metal is holding on to its latest gains. Recent weakness appears to be corrective and the trend structure remains bullish. Note that price recently pierced support at the 50-day EMA - currently at $2391.6.WTI futures rallied sharply higher Monday. The move undermines a recent bearish theme and price has traded through both the 20- and 50-day EMAs. A resumption of gains would signal scope for a climb towards $80.77, a Fibonacci retracement.
  • A bullish trend condition in Bund futures remains intact and recent gains reinforce this theme. 133.21, Jun 14 high, was cleared on Jul 29, confirming a resumption of the uptrend. Note that MA studies are in a bull-mode position too. The trend condition in Gilt futures remains bullish and the latest pullback appears to have been a correction. Note that the move lower has allowed an overbought trend reading to unwind. A resumption of gains would signal scope for a climb towards 101.78. 

FOREIGN EXCHANGE

Keep reading...Show less