MNI DAILY TECHNICAL ANALYSIS - GBP/USD Breaks Lower
Price Signal Summary – GBP/USD Breaks Lower
- A bull cycle in S&P E-Minis remains intact and Tuesday’s pullback appears to be a correction. Recent gains confirm a resumption of the primary uptrend and maintain the bullish price sequence of higher highs and higher lows. Eurostoxx 50 futures traded sharply lower Tuesday, reversing recent gains. The contract has pierced support around the 50-day EMA, at 4944.57. A clear break of this average would undermine a recent bullish theme and highlight a stronger reversal.
- GBPUSD is trading lower today, marking the end of the recent consolidation phase. The break lower also confirms a resumption of the current bear cycle. Note that an important support at 1.3002, the Sep 11 low, has been breached. USDJPY is unchanged and bulls remain in the driver’s seat. The pair is holding on to its recent gains. The latest rally resulted in a break of the 50-day EMA, a bullish development that undermines a recent bearish theme and highlights a stronger reversal.AUDUSD traded lower this week, marking an extension of the bear leg that started Sep 30. Price has recently traded through both the 20- and 50-day EMAs. The move down undermines a bullish theme and signals scope for a deeper retracement.
- WTI futures gapped lower yesterday and this resulted in a break of the Oct 9 low. An extension lower would threaten the recent bullish theme and expose support at $66.33, the Oct 1 low, and $64.61, the Sep 10 low and a key support. Gold is trading higher this week and the recent short-term retracement appears to have been a correction. The trend condition is bullish and moving average studies are in a bull-mode set-up too, highlighting a clear uptrend and positive market sentiment.
- A bearish theme in Bund futures remains intact and the latest recovery is for now considered corrective. The contract remains below the 20- and 50-day EMAs. Attention is on the next key support at 132.65, the Sep 2 low. A bear cycle in Gilt futures remains present and the latest recovery is considered corrective. Note that short-term gains are allowing an oversold trend condition to unwind. The recent breach of 98.11, the Sep 2 low, strengthens the downtrend.
FOREIGN EXCHANGE
EURUSD TECHS: Bear Mode Condition Remains Intact
- RES 4: 1.1144 High Oct 1
- RES 3: 1.1083 High Oct 2
- RES 2: 1.1009 20-day EMA
- RES 1: 1.0955 High Oct 10
- PRICE: 1.0888 @ 06:10 BST Oct 16
- SUP 1: 1.0881 76.4% retracement of the Aug 1 - Sep 25 bull leg
- SUP 2: 1.0778 Low Aug 1 and a key support
- SUP 3: 1.0736 Low Jul 3
- SUP 4: 1.0666 Low Jun 26
A bear cycle in EURUSD remains intact. Note that moving average studies are shifting to a bear-mode position, reinforcing the current trend condition. A recent double top reversal pattern on the daily chart also highlights a bearish theme. Sights are on 1.0881, a Fibonacci retracement and the next important support. A break of this level would open 1.0778, the Aug 1 low. Initial firm resistance is at 1.1009, the 20-day EMA.
GBPUSD TECHS: Bear Cycle Extends
- RES 4: 1.3434 High Sep 26 and key resistance
- RES 3: 1.3389 High Oct 1
- RES 2: 1.3305 High Oct 2 and the bull trigger
- RES 1: 1.3077/3151 Intraday high / 20-day EMA
- PRICE: 1.2991 @ 08:12 BST Oct 16
- SUP 1: 1.2983 Intraday low
- SUP 2: 1.2959 61.8% retracement of the Aug 8 - Sep 25 bull leg
- SUP 3: 1.2890 Low Aug 18
- SUP 4: 1.2846 76.4% retracement of the Aug 8 - Sep 25 bull leg
GBPUSD is trading lower today, marking the end of the recent consolidation phase. The break lower also confirms a resumption of the current bear cycle. Note that an important support at 1.3002, the Sep 11 low, has been breached. This also reinforces the bear theme and opens 1.2959, a Fibonacci retracement point. On the upside, initial resistance to watch is 1.3151, the 20-day EMA. A clear breach of this average would signal a reversal.
EURGBP TECHS: Support Remains Exposed
- RES 4: 0.8494 High Aug 26
- RES 3: 0.8464 High Sep 11 and key resistance
- RES 2: 0.8453 High Sep 18
- RES 1: 0.8371/8434 20-day EMA / High Oct 3
- PRICE: 0.8327 @ 06:31 BST Oct 16
- SUP 1: 0.8311 Low Oct 1 and a key short-term support
- SUP 2: 0.8276 3.382 projection of the Aug 8 - 13 - 14 price swing
- SUP 3: 0.8250 Low Apr 14 ‘22
- SUP 4: 0.8203 Low Mar 7 2022 and a major support
EURGBP has traded lower this week. Moving average studies are in a bear-mode position - highlighting a dominant downtrend and key support is at 0.8311, Oct 1 low. A break of this level would confirm a resumption of the downtrend. Note that the Oct 3 rally does highlight a possible reversal and the cross is trading close to the base of its 0.9300 - 0.8300 multi-year range and a key area of support. First resistance to watch is at 0.8434, Oct 23 high.
USDJPY TECHS: Trading At Its Recent Highs
- RES 4: 153.40 61.8% retracement of the Jul 3 - Sep 16 bear leg
- RES 3: 151.94 Low Jul 25
- RES 2: 150.76 50.0% retracement of the Jul 3 - Sep 16 bear leg
- RES 1: 149.98 High Oct 14
- PRICE: 149.33 @ 06:48 BST Oct 16
- SUP 1: 148.30/146.82 Low Oct 8 / 20-day EMA
- SUP 2: 143.43/141.65 Low Oct 2 / Low Sep 30
- SUP 3: 140.45 Low Sep 18
- SUP 4: 139.58 Low Sep 16 and the bear trigger
USDJPY is unchanged and bulls remain in the driver’s seat. The pair is holding on to its recent gains. The latest rally resulted in a break of the 50-day EMA, a bullish development that undermines a recent bearish theme and highlights a stronger reversal. Sights are on 150.76, the 50% retracement of the Jul 3 - Sep 16 bear leg. Initial firm support to watch is 146.82, the 20-day EMA. Clearance of this level would signal a reversal.
EURJPY TECHS: Medium-Term Trend Set-Up Remains Bearish
- RES 4: 166.53 High Jul 31
- RES 3: 165.00 Round number resistance
- RES 2: 163.89 High Aug 15 and a reversal trigger
- RES 1: 163.61 High Oct 10
- PRICE: 162.49 @ 07:05 BST Oct 16
- SUP 1: 161.62 20-day EMA
- SUP 2: 158.11/155.15 Low Sep 30 / Low Sep 16
- SUP 3: 154.42 Low Aug 5 and the bear trigger
- SUP 4: 153.87 Low Dec 14 ‘23
EURJPY continues to trade inside its recent range. A medium-term bearish trend condition remains intact and the recovery since early August appears to be corrective. A reversal lower and a resumption of bearish price action would open 158.11, the Sep 30 low, and the first important support. Key resistance is at 163.49, the Sep 27 high (pierced), and 163.89, the Aug 15 high. Clearance of both levels is required to highlight a potential reversal.
AUDUSD TECHS: Pierces The 50-Day EMA
- RES 4: 0.6984 0.764 proj of the Aug 5 - 29 - Sep 11 price swing
- RES 3: 0.6942 High Sep 30 and the bull trigger
- RES 2: 0.6852/6889 High Oct 4 / 3
- RES 1: 0.6773 20-day EMA
- PRICE: 0.6691 @ 07:55 BST Oct 16
- SUP 1: 0.6668 Intraday low
- SUP 2: 0.6646 50.0% retracement of the Aug 5 - Sep 30 bull leg
- SUP 3: 0.6622 Low Sep 11 and key support
- SUP 4: 0.6576 61.8% retracement of the Aug 5 - Sep 30 bull leg
AUDUSD traded lower this week, marking an extension of the bear leg that started Sep 30. Price has recently traded through both the 20- and 50-day EMAs. The move down undermines a bullish theme and signals scope for a deeper retracement, towards 0.6622, the Sep 11 low and a key support. Clearance of this level would strengthen a bearish theme. Key resistance and the bull trigger has been defined at 0.6942, the Sep 30 high.
USDCAD TECHS: Bull Cycle Remains In Play
- RES 4: 1.4000 Round number resistance
- RES 3: 1.3946 High Aug 5 and a key resistance
- RES 2: 1.3942 2.0% 10-dma envelope
- RES 1: 1.3839 High Oct 15
- PRICE: 1.3781 @ 08:03 BST Oct 16
- SUP 1: 1.3725/3637 Low Oct 11 / 20-day EMA
- SUP 2: 1.3567 Low Oct 7
- SUP 3: 1.3473/3420 Low Oct 2 / Low Sep 25 and the bear trigger
- SUP 4: 1.3413 Low Feb 9
Recent short-term gains in USDCAD confirm an extension of the bull cycle that started Sep 25. The pair has pierced 1.3822, the 76.4% Fibonacci retracement of the Aug 5 - Sep 25 bear leg. A clear break of this level would reinforce a bullish theme and open 1.3946, the Aug 5 high. Initial firm support to watch lies at 1.3637, the 20-day EMA. A pullback would be considered corrective and allow an overbought condition to unwind.
FIXED INCOME
BUND TECHS: (Z4) Corrective Bounce
- RES 4: 136.20 High Oct 1 and the bull trigger
- RES 3: 135.24 High Oct 3
- RES 2: 134.63 High Oct 4
- RES 1: 133.84/133.98 50- and 20-day EMA values
- PRICE: 133.70 @ 05:46 BST Oct 16
- SUP 1: 132.75 Low Oct 10
- SUP 2 132.65 Low Sep 2 and a key support:
- SUP 3: 132.25 Low Jul 29
- SUP 4: 131.66 Low Jul 26
A bearish theme in Bund futures remains intact and the latest recovery is for now considered corrective. The contract remains below the 20- and 50-day EMAs. Attention is on the next key support at 132.65, the Sep 2 low. Clearance of this level would strengthen a bearish theme and highlight a stronger reversal. Initial firm resistance is at 133.98, the 20-day EMA. A clear break of this average is required to signal a possible reversal.
BOBL TECHS: (Z4) Monitoring Resistance
- RES 4: 120.650 High Oct 1 and key resistance
- RES 3: 120.190 High Oct 3
- RES 2: 119.870 High Oct 4
- RES 1: 119.391 20-day EMA
- PRICE: 119.180 @ 05:56 BST Oct 16
- SUP 1: 118.620 Low Oct 10
- SUP 2: 118.580 Low Sep 3 and a key support
- SUP 3: 118.00 Round number support
- SUP 4: 117.789 123.6% retrace projection of the Sep 3 - Oct 1 bull leg
A bear cycle in Bobl futures remains intact and short-term gains are considered corrective. The reversal from the Oct 1 high, undermines a recent bullish theme and signals scope for a deeper retracement. The contract has traded through a number of short-term retracement points and has recently breached the 20-day EMA. A continuation lower would open 118.580, the Sep 3 low. Initial resistance is 119.391, the 20-day EMA.
SCHATZ TECHS: (Z4) Resistance Remains Intact
- RES 4: 107.450 1.00 proj of the Sep 3 - 11 - 18 price swing
- RES 3: 107.225/335 High Oct 3 / 1 and key resistance
- RES 2: 107.110 High Oct 4
- RES 1: 106.885 20-day EMA
- PRICE: 106.800 @ 05:46 BST Oct 16
- SUP 1: 106.580 Low Oct 10
- SUP 2: 106.520 Low Sep 3 and a key support
- SUP 3: 106.328 123.6% retracement proj of Sep 3 - Oct 1 bull cycle
- SUP 4: 106.209 138.2% retracement proj of Sep 3 - Oct 1 bull cycle
A short-term bearish threat in Schatz futures remains intact following the reversal from the Oct 1 high. The contract has traded through the 20-day EMA and breached not only 106.815, the Sep 18 low, but also 106.712, 76.4% of the Sep 3 - Oct 1 bull cycle. Sights are on 106.520, the Sep 3 low. On the upside, initial resistance to watch is 106.885, the 20-day EMA. A clear break of it would signal a possible reversal.
GILT TECHS: (Z4) Unwinding An Oversold Short-Term Trend Condition
- RES 4: 99.47 High Oct and key short-term resistance
- RES 3: 98.53 High Oct 3
- RES 2: 98.11 Low Sep 2 and a key near-term resistance
- RES 1: 96.97/97.68 High Oct 15 / 20-day EMA
- PRICE: 96.91 @ Close Oct 15
- SUP 1: 95.83 Low Oct 10
- SUP 2: 95.47 1.236 proj of the Sep 17 - 30 - Oct 1 price swing
- SUP 3: 94.90 2.0% 10-dma envelope
- SUP 4: 94.99 1.382 proj of the Sep 17 - 30 - Oct 1 price swing
A bear cycle in Gilt futures remains present and the latest recovery is considered corrective. Note that short-term gains are allowing an oversold trend condition to unwind. The recent breach of 98.11, the Sep 2 low, strengthens the downtrend, signalling scope for a deeper retracement. The 96.00 handle has given way, exposing 95.47, a Fibonacci projection. Initial firm resistance is seen at 98.11, the Sep 2 low.
BTP TECHS: (Z4) Recovery Extends
- RES 4: 123.40 3.500 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 3: 123.12 3.382 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 2: 122.78 3.236 proj of the Jun 11 - 18 - Jul 1 price swing
- RES 1: 121.67/122.62 High Oct 3 / 1 and the bull trigger
- PRICE: 121.36 @ Close Oct 15
- SUP 1: 119.97 Low Oct 11
- SUP 2: 119.58 38.2% retracement of the Jun 11 - Oct 1 bull cycle
- SUP 3: 118.64 50.0% retracement of the Jun 11 - Oct 1 bull cycle
- SUP 4: 117.34 Low Jul 26
The medium-term trend condition in BTP futures is bullish. Tuesday’s rally marks an extension of the recent bounce from the Oct 11 low. It also signals the end of the latest corrective pullback. A continuation higher would expose key resistance at 122.62, the Oct 1 high, where a break would resume the uptrend. Key short-term support has been defined at 119.97, the Oct 11 low. Clearance of this level would resume the recent bear leg.
EQUITIES
EUROSTOXX50 TECHS: (Z4) Testing Support At The 50-Day EMA
- RES 4: 5256.00 1.00 proj of the Aug 5 - Sep 3 - 6 price swing
- RES 3: 5200.00 Round number resistance
- RES 2: 5138.24 0.764 proj of the Aug 5 - Sep 3 - 6 price swing
- RES 1: 5106.00 High Sep 30 and the bull trigger
- PRICE: 4940.00 @ 06:27 BST Oct 16
- SUP 1: 4935.00 Low Oct 15
- SUP 2: 4884.06 38.2% retracement of the Aug 5 - Sep 30 bull cycle
- SUP 3: 4815.50 50.0% retracement of the Aug 5 - Sep 30 bull cycle
- SUP 4: 4757.00 Low Sep 6 / 10 and key support
Eurostoxx 50 futures traded sharply lower Tuesday, reversing recent gains. The contract has pierced support around the 50-day EMA, at 4944.57. A clear break of this average would undermine a recent bullish theme and highlight a stronger reversal. This would open 4884.06, a Fibonacci retracement. Key resistance and bull trigger is unchanged at 5106.00, the Sep 30 high. A break would resume the uptrend.
E-MINI S&P: (Z4) Bullish Trend Sequence
- RES 4: 6012.75 1.00 projection of the Aug 5 - Sep 3 - 6 price swing
- RES 3: 6000.00 Psychological handle
- RES 2: 5961.00 1.00 projection of the Sep 6 - 17 - 18
- RES 1: 5918.50 High Oct 14
- PRICE: 5864.00 @ 07:19 BST Oct 16
- SUP 1: 5789.86/5724.00 20-day EMA / Low Oct 2
- SUP 2: 5708.29 50-day EMA
- SUP 3: 5675.25 Low Sep 18
- SUP 4: 5658.00 Low Sep 13
A bull cycle in S&P E-Minis remains intact and Tuesday’s pullback appears to be a correction. Recent gains confirm a resumption of the primary uptrend and maintain the bullish price sequence of higher highs and higher lows. Note that moving average studies are in a bull-mode setup, highlighting a dominant uptrend. Sights are on 5961.00, a Fibonacci projection. Initial support to watch is 5789.86, the 20-day EMA.
COMMODITIES
BRENT TECHS: (Z4) Bearish Threat
- RES 4: $86.86 - High Apr 12 and a key resistance
- RES 3: $85.54 - High Jul 5
- RES 2: $83.02 - High Jul 18
- RES 1: $81.16/47 - High Oct 7 / 76.4% of the Jul 5 - Sep 10 bear leg
- PRICE: $74.42 @ 07:06 BST Oct 16
- SUP 1: $73.34 - Low Oct 15
- SUP 2: $69.91/68.29 - Low Oct 1 / Low Sep 10 and the bear trigger
- SUP 3: $67.73 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing
- SUP 4: $66.12 - 1.764 proj of the Apr 12 - Jun 4 - Jul 5 price swing
Brent futures gapped lower Tuesday and this resulted in a break of the last week’s lows. A continuation lower would threaten the recent bullish theme and expose support at $69.91, the Oct 1 low, and $68.29, the Sep 10 low and a key support. For bulls, a resumption of gains would instead refocus attention on the key short-term resistance at $81.16, the Oct 7 high. Clearance of this level would resume to the recent uptrend.
WTI TECHS: (X4) Bear Reversal Threat
- RES 4: $82.59 - High Apr 12 and a key resistance
- RES 3: $81.75 - High Jul 5
- RES 2: $79.69 - High Jul 18
- RES 1: $76.24/78.46 - High Oct 10 / 8 and the bull trigger
- PRICE: $70.75 @ 07:16 BST Oct 16
- SUP 1: $69.71 - Low Oct 15
- SUP 2: $66.33/64.61 - Low Oct 1 / Low Sep 10 and the bear trigger
- SUP 3: $63.89 - 1.618 proj of the Apr 12 - Jun 4 - Jul 5 price swing
- SUP 4: $60.00 - Psychological round number
WTI futures gapped lower yesterday and this resulted in a break of the Oct 9 low. An extension lower would threaten the recent bullish theme and expose support at $66.33, the Oct 1 low, and $64.61, the Sep 10 low and a key support. For bulls, a resumption of gains would instead refocus attention on the key short-term resistance at $78.46, the Oct 8 high. Clearance of this level would resume to the recent uptrend.
GOLD TECHS: Trend Needle Points North
- RES 4: $2708.4 - 2.764 proj of the Jul 25 - Aug 2 - Aug 5 price swing
- RES 3: $2720.5 - 3.0% 10-dma envelope
- RES 2: $2690.2 - 2.618 proj of the Jul 25 - Aug 2 - Aug 5 price swing
- RES 1: $2685.6 - High Sep 26 and the bull trigger
- PRICE: $2675.0 @ 07:21 BST Oct 16
- SUP 1: $2626.7/2604.9 - 20-day EMA / Low Oct 8
- SUP 2: $2584.9 - Low Sep 20
- SUP 3: $2564.6 - 50-day EMA
- SUP 4: $2531.8 - High Aug 20
Gold is trading higher this week and the recent short-term retracement appears to have been a correction. The trend condition is bullish and moving average studies are in a bull-mode set-up too, highlighting a clear uptrend and positive market sentiment. Sights are on $2690.2, a Fibonacci projection. Firm support lies at $2626.7, the 20-day EMA. It has been pierced, a clear break would signal scope for a deeper retracement.
SILVER TECHS: Uptrend Remains Intact
- RES 4: $33.738 - 1.618 proj of the Aug 8 - 26 - Sep 6 price swing
- RES 3: $33.297 - 1.50 proj of the Aug 8 - 26 - Sep 6 price swing
- RES 2: $33.000 - Round number resistance
- RES 1: $32.963 - High Oct 4 and the bull trigger
- PRICE: $31.800 @ 08:07 BST Oct 16
- SUP 1: $30.342 - 50-day EMA
- SUP 2: $29.330 - Trendline support drawn from the Aug 8 low
- SUP 3: $27.686 - Low Sep 6 and a key support
- SUP 4: $27.180 - Low Aug 14
Bullish conditions in Silver remain intact and recent short-term weakness is considered corrective. Last week’s move down resulted in a break of the 20-day EMA. Attention is on support at the 50-day EMA, at $30.342. A clear break of this EMA would undermine a bullish theme and signal scope for a deeper retracement. On the upside, a stronger reversal higher would signal the end of the correction and refocus attention on $32.963, the Oct 4 high.