MNI DAILY TECHNICAL ANALYSIS - GBP Pullback Seen Corrective

MNI (LONDON) - Price Signal Summary – GBPUSD Pullback Considered Corrective 

• A bullish theme in S&P E-Minis remains intact. However, this week’s sharp sell-off highlights the start of a corrective cycle. The pullback has resulted in a breach of the 20-day EMA and the pair has pierced support at the 50-day average, at 5520.21. Eurostoxx 50 futures have reversed course this week and a bearish tone - a correction - remains intact for now. The move down has resulted in a break of both the 20- and 50-day EMAs.
• The recent pullback in GBPUSD is considered corrective and firm support to watch lies at 1.3069, the 20-day EMA. A clear break of this EMA would signal scope for a deeper retracement. Moving average studies are in a bull-mode position. USDJPY has traded lower this week and resistance around the 20-day EMA, at 146.15 today, remains intact. The trend condition is bearish, reinforced by moving average studies that are in a bear-mode position.AUDUSD is unchanged and remains above Wednesday’s low. A bull cycle is in play and the latest pullback is considered corrective. The pair has breached support at the 20-day EMA and this has exposed a more important support at 0.6676, the 50-day EMA.
• The trend condition in Gold is unchanged and remains bullish. Moving average studies are in a bull-mode set-up and this continues to highlight a dominant uptrend. Furthermore, a bullish price sequence of higher highs and higher lows remains intact. WTI futures maintain a softer tone following this week’s sharp sell-off. The break lower resulted in a breach of key support at $70.88, the Aug 5 low. The clear break of this level confirms a resumption of the downtrend that started Apr 12.
• Bund futures have recovered from Monday’s low and from levels just below support at the 50-day EMA, at 132.99. The contract is trading at this week’s highs. First resistance is 134.50, the Aug 22 high, where a break would strengthen a near-term bullish condition. Gilt futures have recovered this week and the contract traded higher again, yesterday. The move off Monday’s low signals the end of the recent corrective cycle. The trend direction is up and this is reinforced by a bullish moving average set-up.

FOREIGN EXCHANGE

EURUSD TECHS: Bullish Trend Condition    

• RES 4: 1.1300 Round number resistance  
• RES 3: 1.1276 High Jul 18 2023
• RES 2: 1.1234 1.618 proj of the Jun 26 - Jul 17 - Aug 1 price swing
• RES 1: 1.1140/1202 High Aug 29 / High Aug 26 and the bull trigger  
• PRICE: 1.1118 @ 06:06 BST Sep 06
• SUP 1: 1.1026 Low Sep 03  
• SUP 2: 1.0990 50.0% retracement of the Aug 1 - 26 bull leg
• SUP 3: 1.0971 50-day EMA
• SUP 4: 1.0878 76.4% retracement of the Aug 1 - 26 bull leg

EURUSD has this week found support just below the 20-day EMA - at 1.1058 today, and the pair is holding on to this week’s gains. A bullish trend condition remains intact and note that moving average studies remain in a bull-mode position, highlighting a primary uptrend. A stronger resumption of gains would open 1.1234, a Fibonacci projection. On the downside, a clear break of the 20-day EMA would expose the 50-day EMA, at 1.0971.  

GBPUSD TECHS: Support Remains Intact

• RES 4: 1.3425 1.764 proj of the Jun 27 - Jul 17 - Aug 8 price swing
• RES 3: 1.3362 1.618 proj of the Jun 27 - Jul 17 - Aug 8 price swing 
• RES 2: 1.3328 76.4% retrace of the Jun 2021 - Sep 2022 bear leg
• RES 1: 1.3200/3266 High Aug 30 / 27 and the bull trigger
• PRICE: 1.3179 @ 06:21 BST Sep 6
• SUP 1: 1.3088 Low Sep 03
• SUP 2: 1.3069 20-day EMA
• SUP 3: 1.3011 Low Aug 21
• SUP 4: 1.2944 50-day EMA

The recent pullback in GBPUSD is considered corrective and firm support to watch lies at 1.3069, the 20-day EMA. A clear break of this EMA would signal scope for a deeper retracement. Moving average studies are in a bull-mode position, highlighting a rising medium-term trend condition. A stronger resumption of gains would open 1.3328, a Fibonacci retracement. 1.3266, the Aug 27 high, is the bull trigger.  

EURGBP TECHS: Bear Flag    

• RES 4: 0.8623 High Aug 22r  
• RES 3: 0.8494 High Aug 26  
• RES 2: 0.8476 50-day EMA
• RES 1: 0.8465 20-Day EMA 
• PRICE: 0.8436 @ 06:30 BST Sep 6
• SUP 1: 0.8400 Low Aug 30 and the bear trigger 
• SUP 2: 0.8383 Low Jul 17 and a key support
• SUP 3: 0.8340 Low Aug 2 ‘22
• SUP 4: 0.8311 3.00 projection of the Aug 8 - 13 - 14 price swing  

The impulsive August sell-off in EURGBP confirmed a clear bearish theme and all key retracement points of the rally between Jul 17 - Aug 8 have been cleared. The latest sideways move still appears to be a flag formation - a bearish continuation pattern that reinforces current conditions. A break lower would open 0.8383, the Jul 17 low and the next key support. Firm resistance is seen at 0.8465, the 20-day EMA. Gains would be considered corrective.      

USDJPY TECHS: Heading South       

• RES 4: 149.61 50-day EMA  
• RES 3: 149.39 High Aug 15
• RES 2: 146.15/147.21 20-day EMA / High Sep 2    
• RES 1: 144.23 High Sep 5     
• PRICE: 142.45 @ 06:42 BST Sep 6
• SUP 1: 141.70 Low Aug 5 and the bear trigger     
• SUP 2: 140.82 Low Jan 2
• SUP 3: 140.25 Low Dec 28 ‘23 and a key support
• SUP 4: 138.07 Low Dec 28   

USDJPY has traded lower this week and resistance around the 20-day EMA, at 146.15 today, remains intact. The trend condition is bearish, reinforced by moving average studies that are in a bear-mode position. A continuation lower would open key support at 141.70, the Aug 5 low. Clearance of this level would confirm a resumption of the downtrend. For bulls, a clear break of the 20-day EMA would instead signal scope for a stronger correction.     

EURJPY TECHS: Trend Needle Points South   

• RES 4: 167.53 Low Jun 14  
• RES 3: 164.06 50-day EMA   
• RES 2: 164.01 200 DMA      
• RES 1: 161.59/162.89 20-day EMA / High Sep 2
• PRICE: 158.52 @ 07:05 BST Sep 6
• SUP 1: 158.03 61.8% retracement of the Aug 5 - 15 bull leg 
• SUP 2: 156.65 76.4% retracement of the Aug 5 - 15 bull leg 
• SUP 3: 154.42 Low Aug 5 and the bear trigger
• SUP 4: 153.87 Low Dec 14 ‘23

The trend outlook in EURJPY remains bearish and this week’s sell-off reinforces this theme. Moving average studies are in a bear-mode set-up and this continues to highlight a dominant downtrend. Sights are on 156.65, a Fibonacci retracement. Clearance of this level would open the key support and bear trigger at 154.42, the Aug 5 low. Initial firm resistance has been defined at 162.89, the Sep 2 high.     

AUDUSD TECHS: Recent Pullback Considered Corrective 

• RES 4: 0.6900 High Jun 16 ‘23       
• RES 3: 0.6871 High Dec 28 and a key resistance                  
• RES 2: 0.6839 High Jan 2
• RES 1: 0.6824 High Aug 29 and the bull trigger 
• PRICE: 0.6737 @ 07:57 BST Sep 6
• SUP 1: 0.6676 50-day EMA   
• SUP 2: 0.6571 Low Aug 15 
• SUP 3: 0.6508/6350 Low Aug 8/ 5 and the bear trigger 
• SUP 4: 0.6339 Low Nov 10’23

AUDUSD is unchanged and remains above Wednesday’s low. A bull cycle is in play and the latest pullback is considered corrective. The pair has breached support at the 20-day EMA and this has exposed a more important support at 0.6676, the 50-day EMA. Clearance of this average is required to signal scope for a deeper retracement. For bulls, a reversal higher and a break of 0.6824, Aug 29 high, would resume the uptrend.

USDCAD TECHS: Bear Trend Intact

• RES 4: 1.3646 High Aug 15
• RES 3: 1.3641 50-day EMA 
• RES 2: 1.3574 20-day EMA  
• RES 1: 1.3565 High Sep 03
• PRICE: 1.3490 @ 07:55 BST Sep 06
• SUP 1: 1.3441 Low Aug 28 and the bear trigger 
• SUP 2: 1.3420 Low Mar 08
• SUP 3: 1.3358 76.4% retracement of the Dec 27 - Aug 5 bull leg
• SUP 4: 1.3288 Low Jan 05

Recent gains in USDCAD appear to have been a correction and the recent impulsive sell-off, in August, reinforces a bearish condition. Note too that moving average studies are in a bear-mode set-up, highlighting a dominant downtrend. A resumption of bearish activity would signal scope for a move towards 1.3358, a Fibonacci retracement. On the upside, initial firm resistance to watch is at 1.3574 the 20-day EMA.    

FIXED INCOME

BUND TECHS: (Z4) Holding On To This Week’s Gains  

• RES 4: 136.00 Round number resistance         
• RES 3: 135.66 High Aug 5 and the bull trigger
• RES 2: 134.95 76.4% retracement of the Aug 5 - Sep 2 bear leg  
• RES 1: 134.50 High Aug 22                   
• PRICE: 134.28 @ 05:45 BST Sep 6
• SUP 1: 133.61/03 20- and 50-day EMA values             
• SUP 2: 132.65 Low Sep 2 and the bear trigger 
• SUP 3: 132.25 Low Jul 29 
• SUP 4: 131.66 Low Jul 26

Bund futures have recovered from Monday’s low and from levels just below support at the 50-day EMA, at 132.99. The contract is trading at this week’s highs. First resistance is 134.50, the Aug 22 high, where a break would strengthen a near-term bullish condition. This would open 134.95, a Fibonacci retracement. On the downside, a clear break of the 50-day EMA would highlight scope for a deeper retracement.     

BOBL TECHS: (Z4) Bullish Recovery

• RES 4: 119.234 1.764 proj of the May 31 - Jun 14 - Jul 5 price swing
• RES 3: 119.764 76.4% retracement of the Aug 5 - Sep 3 bear leg
• RES 2: 119.538 61.8% retracement of the Aug 5 - Sep 3 bear leg     
• RES 1: 119.490 High Sep 5                   
• PRICE: 119.440 @ 05:57 BST Sep 6
• SUP 1: 119.044 20-day EMA       
• SUP 2: 118.580 Low Sep 3   
• SUP 3: 118.440 1.00 proj of the Aug 5 - 7 - 13 price swing   
• SUP 4: 118.170 1.236 proj of the Aug 5 - 7 - 13 price swing

A recent corrective bear cycle in Bobl futures has allowed an overbought condition to unwind. This week’s recovery is potentially an early bullish signal. The contract has found support at 118.580, the Sep 3 low. A continuation higher would strengthen a bullish condition and signal scope for a climb towards key resistance and the bull trigger at 120.130, the Aug 5 high. On the downside, clearance of 118.580 would reinstate a bearish theme.                

SCHATZ TECHS: (Z4) Bullish Recovery 

• RES 4: 107.210 High Aug 5 and the bull trigger  
• RES 3: 107.047 76.4% retracement of the Aug 5 - Sep 3 bear leg
• RES 2: 106.946 61.8% retracement of the Aug 5 - Sep 3 bear leg
• RES 1: 106.850 High Sep 5   
• PRICE: 106.825 @ 06:07 BST Sep 6
• SUP 1: 106.675 Low Sep 4        
• SUP 2: 106.520 Low Sep 3 and the bear trigger  
• SUP 3: 106.315 1.00 of the Aug 5 - 7 - 13  minor price swing  
• SUP 4: 106.193 1.236 of the Aug 5 - 7 - 13  minor price swing

An uptrend in Schatz futures remains intact and recent weakness is considered corrective. The recovery this week is a positive development and signals the end of the recent corrective cycle. A continuation higher would pave the way for a climb towards 107.047, a Fibonacci retracement point. On the downside, clearance of 106.520, the Sep 3 low would reinstate the recent bear cycle.                          

GILT TECHS: (Z4) Bullish Outlook                                            

• RES 4: 101.00 Round number resistance
• RES 3: 100.65 High Aug 15 (cont) 
• RES 2: 100.30 High Aug 14 and the bull trigger
• RES 1: 100.05 Intraday high     
• PRICE: 100.00 @ 08:03 BST Sep 6
• SUP 1: 99.02/98.11 Low Sep 4 / 2          
• SUP 2: 98.00 Round number support   
• SUP 3: 97.91 1.618 proj of the Aug 14 - 16 - 22 price swing
• SUP 4: 97.73 1.764 proj of the Aug 14 - 16 - 22 price swing  

Gilt futures have recovered this week and the contract traded higher again, yesterday. The move off Monday’s low signals the end of the recent corrective cycle. The trend direction is up and this is reinforced by a bullish moving average set-up on the continuation chart. Sights are on the next firm resistance at 100.30, the Aug 14 high. On the downside, clearance of support at 98.11, Sep 2 low, would reinstate the recent bearish theme.        

BTP TECHS: (Z4) Pierces The Bull Trigger       

• RES 4: 121.04 2.500 proj  of the Jun 11 - 18 - Jul 1 price swing
• RES 3: 120.76 2.382 proj  of the Jun 11 - 18 - Jul 1 price swing
• RES 2: 120.42 2.236 proj  of the Jun 11 - 18 - Jul 1 price swing
• RES 1: 119.90/94 High Aug 22 and the bull trigger / High Sep 5 
• PRICE: 119.65 @ Close Sep 5
• SUP 1: 119.05/118.16 20-day EMA / Low Sep 2 and the bear trigger    
• SUP 2: 118.00 Low Jul 29 
• SUP 3: 116.21 Low Jul 9
• SUP 4: 115.14 Low Jul 1

The medium-term trend condition in BTP futures remains bullish and the latest move lower has been a correction. This week’s gains reinforce this theme and has resulted in a print above 119.90, the Aug 22 high and a bull trigger. A clear break of this level would confirm a resumption of the uptrend. Moving average studies are in a bull-mode set-up, reinforcing current trend conditions. Key support is at 118.16, the Sep 2 low.                            

EQUITIES

EUROSTOXX50 TECHS: (U4) Corrective Cycle Remains In Play             

• RES 4: 5132.00 High Jun 6       
• RES 3: 5087.00 High Jul 12 and a key resistance    
• RES 2: 5012.00 High Jul 16
• RES 1: 4886.63/4998.00 50-day EMA / High Sep 3 and a bull trigger   
• PRICE: 4821.00 @ 06:19 BST Sep 6
• SUP 1: 4805.47 38.2% retracement of the Aug 5 - Sep 3 bull cycle
• SUP 2: 4747.00 50.0% retracement of the Aug 5 - Sep 3 bull cycle  
• SUP 3: 4718.00 Low Aug 14 
• SUP 4: 4686.53 61.8% retracement of the Aug 5 - Sep 3 bull cycle 

Eurostoxx 50 futures have reversed course this week and a bearish tone - a correction - remains intact for now. The move down has resulted in a break of both the 20- and 50-day EMAs. This paves the way for a pullback towards 4805.47 initially, a Fibonacci retracement. Initial firm short-term resistance has been defined at 4998.00, the Sep 3 high. Clearance of this level would reinstate the recent bullish theme.               

E-MINI S&P: (U4) Corrective Pullback            

• RES 4: 5821.25 1.00 proj of the Apr 19 - Jul 16 - Aug 5 price swing  
• RES 3: 5800.00 Round number resistance  
• RES 2: 5721.25 High Jul 16 and key resistance
• RES 1: 5557.86/5669.75 20-day EMA / High Sep 3 and a bull trigger         
• PRICE: 5499.50 @ 07:21 BST Sep 6
• SUP 1: 5488.50 Intraday low     
• SUP 2: 5459.75 38.2% retracement of the Aug 5 - Sep 3 bull leg 
• SUP 3: 5438.75 Low Aug 14   
• SUP 4: 5394.88 50.0% retracement of the Aug 5 - Sep 3 bull leg

A bullish theme in S&P E-Minis remains intact. However, this week’s sharp sell-off highlights the start of a corrective cycle. The pullback has resulted in a breach of the 20-day EMA and the pair has pierced support at the 50-day average, at 5520.21. A clear break of this EMA would signal scope for a deeper retracement towards 5459.75, a Fibonacci retracement. Key near-term resistance has been defined at 5669.75, the Sep 3 high.    

COMMODITIES

BRENT TECHS: (X4) Bear Cycle Remains Intact     

• RES 4: $86.24 - High Jul 5
• RES 3: $83.50 - 76.4% retracement of the Jul 5 - Aug 5 bear leg
• RES 2: $80.53/81.46 - High Aug 26 / 12 and key resistance
• RES 1: $76.94 - 20-day EMA     
• PRICE: $72.89 @ 07:05 BST Sep 6
• SUP 1: $72.35 - Low Sep 4  
• SUP 2: $70.35 - 1.382 proj of the Apr 12 - Jun 4 - Jul 5 price swing
• SUP 3: $68.99 - 1.50 proj of the Apr 12 - Jun 4 - Jul 5 price swing
• SUP 4: $67.63 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing  

Brent futures are trading at this week’s lows. The move down has resulted in a break of support at $74.62, the Aug 5 low and a bear trigger. The break confirms a resumption of the downtrend that started in April and paves the way for an extension towards $70.35, a Fibonacci projection. A key support at $73.16, the Dec 13 ‘23 low, has also been cleared, strengthening a bearish theme. Initial resistance is at $76.94, the 20-day EMA.     

WTI TECHS: (V4) Bear Threat Remains Present      

• RES 4: $83.45 - High Apr 12 and a medium-term bull trigger
• RES 3: $82.62 - High Jul 5 
• RES 2: $80.82 - High Jul 18  
• RES 1: $73.66/78.54 - 20-day EMA / High Aug 12 and key resistance     
• PRICE: $69.34 @ 07:14 BST Sep 6
• SUP 1: $68.75 - Low Sep 5   
• SUP 2: $66.66 - 1.382 proj of the Apr 12 - Jun 4 - Jul 5 price swing
• SUP 3: $65.30 - 1.50 proj of the Apr 12 - Jun 4 - Jul 5 price swing
• SUP 4: $63.93 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing

WTI futures maintain a softer tone following this week’s sharp sell-off. The break lower resulted in a breach of key support at $70.88, the Aug 5 low. The clear break of this level confirms a resumption of the downtrend that started Apr 12 and paves the way for an extension towards $66.66, a Fibonacci projection. MA studies are in a bear-mode position highlighting a clear downtrend. Initial resistance is at $73.66, the 20-day EMA.       

GOLD TECHS: Bullish Price Sequence    

• RES 4: $2600.0 - Round number resistance    
• RES 3: $2575.4 - 3.236 proj of the Oct 6 - 27 - Nov 13 ‘23 price swing
• RES 2: $2536.4 - 1.50 proj of the Jul 25 - Aug 2 - Aug 5 price swing 
• RES 1: $2531.8 - High Aug 20 and the bull trigger                  
• PRICE: $2521.0 @ 07:20 BST Sep 6
• SUP 1: $2472.0 - Low Sep  4 
• SUP 2: $2443.9 - 50-day EMA 
• SUP 3: $2417.0 - Low Sep 8 
• SUP 4: $2364.4 - Low Aug 5 

The trend condition in Gold is unchanged and remains bullish. Moving average studies are in a bull-mode set-up and this continues to highlight a dominant uptrend. Furthermore, a bullish price sequence of higher highs and higher lows remains intact. Sights are on $2536.4 next, a Fibonacci projection. The 20-day EMA has been pierced. The next firm support to watch lies at $2443.9, the 50-day EMA. S/T weakness is considered corrective.       

SILVER TECHS: Key Resistance Remains Intact   

• RES 4: $33.880 - 1.00 proj of the Jan 22 - Apr 12 - May 2 price swing       
• RES 3: $31.754/32.518 - High Jul 11 / High May 20 and bull trigger
• RES 2: $30.502 - 76.4% retracement of the Jul 11 - Aug 8 bear leg
• RES 1: $28.913/30.192 - 50-day EMA / High Aug 26                 
• PRICE: $28.883 @ 08:06 BST Sep 6
• SUP 1: $27.708/26.451 - Low Sep 3 / Low Aug 8  
• SUP 2: $26.018 - Low May 2 and a key support
• SUP 3: $24.328 - Low Mar 27 
• SUP 4: $22.277 - Low Feb 28 

A medium-term bearish cycle in Silver remains intact. The metal on Aug 8, traded to a fresh cycle low, before rebounding and this has exposed key support at $26.018, May 2 low. Key short-term resistance has been defined at $30.192, the Aug 26 high. A resumption of gains and a breach of this hurdle would cancel the bearish theme and expose $30.502 next, a Fibonacci retracement.