MNI DAILY TECHNICAL ANALYSIS - GBP/USD Struggles to Sustain Rallies

Price Signal Summary - GBP/USD Struggles to Sustain Rallies

• The S&P E-minis outlook remains bullish and yesterday’s pullback is considered corrective - for now. Trend signals highlight an uptrend and the focus is on a climb towards 4244.00, the Feb 2 high and the next important resistance. Eurostoxx 50 futures traded lower Tuesday. For now, the pullback appears to be a correction and trend signals continue to point north - moving average studies remain in a bull mode position. The contract has tested support at the 20-day EMA, which intersects at 4323.50.
• GBPUSD maintains a softer tone and traded lower Tuesday, before finding support. A bearish theme remains intact and price continues to test support at 1.2410, the 50-day EMA. A clear break of it would strengthen a bearish threat and expose 1.2345, the Apr 10 low. USDJPY bullish conditions remain intact - a fresh trend high Tuesday reinforces current conditions and the pair is holding on to its recent gains. Last week’s break of 137.77-91, the May 2 and Mar 8 high respectively, confirmed a resumption of the uptrend that started Jan 16. AUDUSD is weaker today as the pair extends the bear cycle and the reversal on May 10. Attention is on key support at 0.6565, the Mar 10 low. Clearance of this level would confirm a resumption of the bear cycle that started Feb 2 and highlight a range breakout.
• Gold remains in a bearish cycle and is trading closer to its recent lows. The yellow metal last week cleared support at $1976.1, the 50-day EMA and $1969.3, the Apr 19 low. The clear break of this support zone highlights a stronger bearish threat and opens $1934.3, the Mar 22 low. A short-term bearish theme in WTI futures remains present and the latest gains are still considered corrective. Trend signals point south - moving average studies continue to highlight a downtrend.
• Bund futures are trading closer to recent lows and remain in bearish mode following last week’s move lower. Support at 134.99, the May 10 low, has been breached and this strengthens the bearish theme. Gilt futures remain in a bear mode position and are already trading sharply lower again today. The move highlights a continued acceleration of the downtrend as the current impulsive bear wave extends.

FOREIGN EXCHANGE

EURUSD TECHS: Bearish Outlook

• RES 4: 1.1127 1.00 projection of the Mar 15 - 23 - 24 price swing
• RES 3: 1.1054/95 High May 8 / High Apr 26 and key resistance
• RES 2: 1.1007 High May 10
• RES 1: 1.0874/0887 50- and 20-day EMA values
• PRICE: 1.0779 @ 05:32 BST May 24
• SUP 1: 1.0760 Low May 19 / 23
• SUP 2: 1.0737 61.8% retracement of the Mar 15 - Apr 26 bull run
• SUP 3: 1.0713 Low Mar 24
• SUP 4: 1.0653 76.4% retracement of the Mar 15 - Apr 26 bull run

EURUSD traded lower yesterday and touched last week’s 1.0760 low. The outlook remains bearish. The 50-day EMA, at 1.0874, has recently been breached and price remains below the average. This reinforces bearish conditions and signals scope for a continuation lower towards 1.0737 next, a Fibonacci retracement. Clearance of this level would open 1.0713, the Mar 24 low. A firm resistance is seen at 1.0887, the 20-day EMA.

GBPUSD TECHS: Testing The 50-Day EMA

• RES 4: 1.2767 61.8% of the Jun 1 ‘21 - Sep 26 ‘22 downtrend
• RES 3: 1.2680 High May 10 and the bull trigger
• RES 2: 1.2547/2641 High May 16 / 11
• RES 1: 1.2487 20-day EMA
• PRICE: 1.2435 @ 05:45 BST May 24
• SUP 1: 1.2373 Low May 23
• SUP 2: 1.2353/45 Low Apr 17 / 10 and a key support
• SUP 3: 1.2275 Low Apr 3
• SUP 4: 1.2242 50.0% retracement of the Mar 8 - May 10 bull run

GBPUSD maintains a softer tone and traded lower Tuesday, before finding support. A bearish theme remains intact and price continues to test support at 1.2410, the 50-day EMA. A clear break of it would strengthen a bearish threat and expose 1.2345, the Apr 10 low. On the upside, initial resistance is 1.2480, the 20-day EMA. A break above 1.2547, the May 16 high, is required to signal a reversal.

EURGBP TECHS: Trend Needle Points South

• RES 4: 0.8875 High Apr 25 and key short-term resistance
• RES 3: 0.8835 High May 3
• RES 2: 0.8763 50-day EMA
• RES 1: 0.8724 20-day EMA
• PRICE: 0.8669 @ 06:11 BST May 24
• SUP 1: 0.8661 Low May 11
• SUP 2: 0.8649 76.4% retracement of the Dec 1 - Feb 3 bull run
• SUP 3: 0.8593 Low Dec 15 2022
• SUP 4: 0.8562 Low Dec 13 2022

The EURGBP short-term trend needle points south and the cross is approaching the May 11 low of 0.8661.The latest pause appears to be a bear flag and a break of 0.8661 would confirm a resumption of the trend, exposing 0.8649, a Fibonacci retracement. Initial firm resistance is at 0.8724 the 20-day EMA. The 50-day EMA intersects at 0.8763 where a clear break is required to signal a reversal.

USDJPY TECHS: Holding On To Recent Gains

• RES 4: 140.62 Bull channel top drawn from the Jan 16 low
• RES 3: 139.59 50.0% retracement of the Oct - Jan bear cycle
• RES 2: 139.00 Round number resistance
• RES 1: 138.91 High May 23
• PRICE: 138.27 @ 06:47 BST May 24
• SUP 1: 137.29 Low May 18
• SUP 2: 136.29/135.00 20- and 50-day EMA values
• SUP 3: 133.50 Low May 4
• SUP 4: 133.02 Low Apr 26 and a key near-term support

USDJPY bullish conditions remain intact - a fresh trend high Tuesday reinforces current conditions and the pair is holding on to its recent gains. Last week’s break of 137.77-91, the May 2 and Mar 8 high respectively, confirmed a resumption of the uptrend that started Jan 16. This opens 139.00 and 139.59, a Fibonacci retracement. Initial firm support is seen at 136.29, the 20-day EMA. Key support is far off at 133.50, the May 4 low.

EURJPY TECHS: Remains Above Support

• RES 4: 152.00 1.382 proj of the Mar 20 - 21 - Apr 6 price swing
• RES 3: 151.61 High May 2 and the bull trigger
• RES 2: 150.32 76.4% retracement of the May 2 - 11 bear leg
• RES 1: 150.06 High May 23
• PRICE: 149.15 @ 06:55 BST May 24
• SUP 1: 148.36 20-day EMA
• SUP 2: 146.79/13 50-day EMA / Low May 11
• SUP 3: 145.67 High Mar 31
• SUP 4: 145.49 2.0% 10-dma envelope

EURJPY maintains a short-term bullish tone and traded higher yesterday. The focus is on 150.32 next, a Fibonacci retracement, ahead of 151.61, the May 2 high and a bull trigger. The 50-day EMA, which intersects at 146.79, remains intact and marks a key support. A clear break of this average is required to signal a resumption of bearish activity. Initial support lies at 148.36, the 20-day EMA.

AUDUSD TECHS: Approaching Key Support

• RES 4: 0.6921 High Feb 20
• RES 3: 0.6861 50.0% retracement of the Feb 2 - Mar 10 bear leg
• RES 2: 0.6824 High Feb 24
• RES 1: 0.6697/6818 50-day EMA / High May 10 and key resistance
• PRICE: 0.6584 @ 07:58 BST May 24
• SUP 1: 0.6574 Low Apr 28
• SUP 2: 0.6565 Low May 10 and the bear trigger
• SUP 3: 0.6547 61.8% of the Oct - Feb bull cycle
• SUP 4: 0.6403 76.4% of the Oct - Feb bull cycle

AUDUSD is weaker today as the pair extends the bear cycle and the reversal on May 10. Attention is on key support at 0.6565, the Mar 10 low. Clearance of this level would confirm a resumption of the bear cycle that started Feb 2 and highlight a range breakout. This would open 0.6547, a Fibonacci retracement. On the upside, a breach of 0.6818 is required to reinstate a bullish theme. Initial firm resistance is seen at 0.6697, the 50-day EMA.

USDCAD TECHS: Bullish Theme

• RES 4: 1.3695 High Mar 28
• RES 3: 1.3668 High Apr 28 and key resistance
• RES 2: 1.3640 High May 3
• RES 1: 1.3568 High May 15
• PRICE: 1.3534 @ 08:02 BST May 24
• SUP 1: 1.3404 Low May 16
• SUP 2: 1.3363/15 Low May 11 / 8
• SUP 3: 1.3302 Low Apr 14 and a key near-term support
• SUP 4: 1.3275 Low Feb 14

USDCAD is in consolidation mode but is holding on to the bulk of its recent gains. The recovery from the May 8 low has eased a recent bearish threat and the pair has traded through the 50-day EMA, currently at 1.3512. A clear breach of this average would strengthen the case for bulls and signal scope for a climb towards resistance at 1.3668, the Apr 28 high. Key support lies at 1.3302, the Apr 14 low. A break would reinstate a bearish theme.

FIXED INCOME

BUND TECHS: (M3) Bearish Threat Still Present

• RES 4: 138.09 High Apr 6
• RES 3: 137.55 61.8% retracement of the Mar 20 - Apr 19 bear leg
• RES 2: 137.29 High May 11
• RES 1: 135.07/136.38 20-day EMA / High May 16
• PRICE: 134.16 @ 05:04 BST May 24
• SUP 1: 133.50 Low May 19
• SUP 2: 133.10 Low Apr 19 and the bear trigger
• SUP 3: 132.71 76.4% retracement of the Mar 2 - 20 rally
• SUP 4: 132.37 Low Mar 10

Bund futures are trading closer to recent lows and remain in bearish mode following last week’s move lower. Support at 134.99, the May 10 low, has been breached and this strengthens the bearish theme. The focus is on key support at 133.10, the Apr 19 low. On the upside, key short-term resistance has been defined at 137.29, the May 11 high. Initial resistance is 135.07, the 20-day EMA.

BOBL TECHS: (M3) Bear Cycle Still In Play

• RES 4: 119.120 High May 4 and key short-term resistance
• RES 3: 118.610/119.020 High May 16 / 11
• RES 2: 118.240 High May 17
• RES 1: 117.795 20-day EMA
• PRICE: 117.320 @ 05:05 BST May 24
• SUP 1: 116.960 Low May 23
• SUP 2: 116.890 Low Apr 28
• SUP 3: 116.720 Low Apr 25
• SUP 4: 116.420 Low Apr19 and the bear trigger

The short-term outlook in Bobl futures remains bearish and the contract traded to a fresh short-term trend low yesterday. Price last week breached support at 117.930, May 10 low. This signals scope for an extension lower and opens 116.890, Apr 28 low. Key short-term resistance has been defined at 119.120, the May 4 high where a break is required to reinstate the recent bullish theme. Initial firm resistance is seen at 117.795, the 20-day EMA.

SCHATZ TECHS: (M3) Bearish Outlook

• RES 4: 106.190 High Apr 6
• RES 3: 106.020/106.120 High May 11 / 4
• RES 2: 105.910 High May 16
• RES 1: 105.641 20-day EMA
• PRICE: 105.485 @ 05:34 BST May 24
• SUP 1: 105.355 Low May 23
• SUP 2: 105.350 Low Apr 28
• SUP 3: 105.235 Low Apr 25
• SUP 4: 105.165 Low Apr 19 / 24 and bear trigger

A bearish cycle in Schatz futures remains in play and the contract traded to a fresh short-term cycle low yesterday. Price last week breached support at 105.705, May 10 low. This has strengthened current bearish conditions and signals scope for a retracement to 105.350 next, the Apr 28 low. On the upside, the bull trigger has been defined at 106.120, the May 4 high. Initial resistance is seen at 105.641, the 20-day EMA.

GILT TECHS: (M3) Impulsive Bear Wave Extends

• RES 4: 100.15 20-day EMA
• RES 3: 99.73/100.11 Low Apr 19 / High May 18
• RES 2: 99.21 High May 19
• RES 1: 96.93/97.98 Intraday high / High May 23
• PRICE: 95.51 @ 08:06 May 24
• SUP 1: 94.76 76.4% of the Oct 12 - Nov 24 2022 rally (cont)
• SUP 2: 94.51 3.00 projection of the May 3 - 10 - 11 price swing
• SUP 3: 93.92 3.236 projection of the May 3 - 10 - 11 price swing
• SUP 4: 93.27 3.382 projection of the May 3 - 10 - 11 price swing

Gilt futures remain in a bear mode position and are already trading sharply lower again today. The move highlights a continued acceleration of the downtrend as the current impulsive bear wave extends. Sights are set on 94.76 next, 76.4% of the Oct 12 - Nov 24 2022 rally (cont). Initial resistance is at today’s intraday high of 96.93. A firmer resistance is seen at 99.73, the Apr 19 low.

BTP TECHS: (M3) Bearish Threat

• RES 4: 116.97 High Apr 6
• RES 3: 116.17 76.4% retracement of the Mar 24 - Apr 24 downleg
• RES 2: 115.48/89 High May 16 / 11
• RES 1: 114.65 High May 22
• PRICE: 113.72 @ Close May 23
• SUP 1: 113.46 Low May 19
• SUP 2: 112.93/89 Low Apr 24 / 61.8% of the Mar 2 - 24 rally
• SUP 3: 111.88 76.4% retracement of the Mar 2 - 24 rally
• SUP 4: 111.05 Low Mar 8

A bearish threat in BTP futures remains present. The contract traded sharply lower last Thursday and price moved below both the 20- and 50-day EMAs. Support at 113.91, the May 10 low, has also been breached. This signals scope for an extension lower towards key support at 112.93, the Apr 24 low. A breach of this level would strengthen bearish conditions. Key short-term resistance is at 115.89, the May 11 high.

EQUITIES

EUROSTOXX50 TECHS: (M3) Corrective Pullback

• RES 4: 4510.50 0.618 proj of the Mar 20 - Apr 21 - May 4 price swing
• RES 3: 4457.50 0.5 proj of the Mar 20 - Apr 21 - May 4 price swing
• RES 2: 4448.00 High Jan 2008 (cont)
• RES 1: 4409.50 High Nov 18 2021 (cont) and a major resistance
• PRICE: 4329.00 @ 05:49 BST May 24
• SUP 1: 4322.00/4266.30 Low May 23 / 50-day EMA
• SUP 2: 4233.00 Low May 4
• SUP 3: 4175.00 Low Mar 30
• SUP 4: 4164.00 High Mar 22

Eurostoxx 50 futures traded lower Tuesday. For now, the pullback appears to be a correction and trend signals continue to point north - moving average studies remain in a bull mode position. The contract has tested support at the 20-day EMA, which intersects at 4323.50. A clear break would expose the 50-day EMA at 4266.30. On the upside, the bull trigger has been defined at 4409.00, the May 19 high. A break would resume the uptrend.

E-MINI S&P TECHS: (M3) Pullback Considered Corrective

• RES 4: 4288.00 High Aug 19 2022
• RES 3: 4244.00 High Feb 2 and a medium-term bull trigger
• RES 2: 4231.00 High Feb 3
• RES 1: 4227.25 High May 19
• PRICE: 4160.50 @ 06:59 BST May 24
• SUP 1: 4153.00 20-day EMA
• SUP 2: 4124.34/4062.25 50-day EMA / Low May 4 and key support
• SUP 3: 4052.50 Low Mar 30
• SUP 4: 4022.75 50.0% retracement of the Mar 13 - May 1 bull leg

The S&P E-minis outlook remains bullish and yesterday’s pullback is considered corrective - for now. Trend signals highlight an uptrend and the focus is on a climb towards 4244.00, the Feb 2 high and the next important resistance. On the downside, the 20-day EMA has been tested. A clear break of it would expose the 50-day EMA which intersects at 4124.34 and marks a key support.

COMMODITIES

BRENT TECHS: (N3) Corrective Cycle Extends

• RES 4: $85.08 - High Apr 18
• RES 3: $85.08 - High Apr 18
• RES 2: $82.88 - High Apr 25
• RES 1: $78.56 - 50-day EMA
• PRICE: $77.63 @ 07:04 BST May 24
• SUP 1: $73.49/71.28 - Low May 15 / 4
• SUP 2: $70.10 - Low Mar 20 and a key support
• SUP 3: $69.28 - Low Dec 20 2021 (cont)
• SUP 4: $65.72 - Low Dec 2 2021 (cont)

A bearish threat in Brent futures remains present despite yesterday’s gains and the recovery from $71.28, the May 4 low, appears to be a correction. Resistance at the 50-day EMA which intersects at $78.56, is intact. A clear break of the average is required to strengthen a bullish threat and signal scope for a stronger recovery. On the downside, a breach of $73.49, the May 15 low, would set the scene for an extension towards $71.28.

WTI TECHS: (N3) Watching Resistance At The 50-Day EMA

• RES 4: $80.93 - High Apr 19
• RES 3: $79.00 - High Apr 24
• RES 2: $76.74 - High Apr 28
• RES 1: $74.41 - 50-day EMA
• PRICE: $73.75 @ 07:14 BST May 24
• SUP 1: $69.39/63.90 - Low May 15 / 4
• SUP 2: $62.43 - Low Dec 2 2021 (cont)
• SUP 3: $60.00 - Psychological round number
• SUP 4: $57.63 - Low Apr 5 2021 (cont)

A short-term bearish theme in WTI futures remains present and the latest gains are still considered corrective. Trend signals point south - moving average studies continue to highlight a downtrend. A resumption of weakness and a break of $69.39, the May 15 low, would strengthen near-term bearish conditions. On the upside, resistance is seen at $74.41, the 50-day EMA. A clear break of this level would alter the picture.

GOLD TECHS: Approaching Trendline Support

• RES 4: $2075.5 - All-Time High Aug 7 2020
• RES 3: $2070.4 - High Mar 8 and a key resistance
• RES 2: $2022.6/2063.0 - High May 12 / 4 and key resistance
• RES 1: $1994.4 20-day EMA
• PRICE: $1976.3 07:17 BST May 24
• SUP 1: $1952.0 - Low May 18
• SUP 2: $1934.3 - Low Mar 22
• SUP 3: $1929.1 - Trendline support drawn from the Nov 3 2022
• SUP 4: $1900.0 - Round number support

Gold remains in a bearish cycle and is trading closer to its recent lows. The yellow metal last week cleared support at $1976.1, the 50-day EMA and $1969.3, the Apr 19 low. The clear break of this support zone highlights a stronger bearish threat and opens $1934.3, the Mar 22 low and $1929.1, trendline support drawn from Nov 3 2022. Key resistance and the bull trigger is at $2063.0, May 4 high. Initial firm resistance is $2022.6, the May 12 high.

SILVER TECHS: Bearish Outlook

• RES 4: $26.771 - High Mar 9 2022
• RES 3: $26.222 - High Apr 18 2022 and a key resistance
• RES 2: $26.135 - High May 5
• RES 1: $24.492 - Apr 25 low and double top mid-point
• PRICE: $23.348 @ 07:52 BST May 24
• SUP 1: $23.110 - Low May 18
• SUP 2: $23.020 - 50.0% retracement of the Mar 10 - May 5 rally
• SUP 3: $22.761 - Low Mar 23
• SUP 4: $22.284 - 61.8% retracement of the Mar 10 - May 5 rally

Silver bears remain in the driver’s seat. The May 11 sell-off confirmed a double top reversal pattern following the break of $24.492, the Apr 25 low. The metal has also breached the 20- and 50-day EMAs. This signals scope for a move towards $23.020, a Fibonacci retracement. Initial resistance is seen at $24.492, the double top mid-point. Key resistance has been defined at $26.135, the May 5 high.