MNI DAILY TECHNICAL ANALYSIS - GBP Weakness Deemed Corrective in Nature

Price Signal Summary – GBP Weakness Deemed Corrective in Nature

• A bullish theme in S&P e-minis remains intact and yesterday’s abrupt sell-off appears to be a correction - for now. This week’s fresh trend highs, confirm once again a resumption of the uptrend that started Oct 27. The contract has recently cleared resistance at 4738.50, the Jul 27 high. A bullish theme in Eurostoxx 50 futures remains intact and the latest pullback appears to be a correction. Recent gains confirmed, once again, a resumption of the uptrend and this has maintained the bullish price sequence of higher highs and higher lows.
• The trend outlook in GBPUSD remains bullish and recent weakness is considered corrective. Moving average studies are in a bull-mode set-up, highlighting a rising trend. Key resistance and the bull trigger is at 1.2733, the Nov 29 high. USDJPY remains below Tuesday’s high. The recovery from 140.97, the Dec 14 low, appears to be a correction - for now. Recent weakness reinforces current bearish conditions. On Dec 14, the pair breached support at 141.71, the Dec 7 low, to confirm a resumption of the downtrend. Bullish trend conditions in the AUDUSD remain intact. This week’s gains mark an extension of last week’s move higher and the break of resistance at 0.6691, the Dec 4 high and a bull trigger. Scope is seen for a climb for a climb towards the 0.6800 handle and 0.6821, the Jul 27 high.
• Gold is in consolidation mode. The Dec 13 reversal signals the end of the recent Dec 4 - 13 corrective pullback and highlights a bullish theme. MA studies are in a bull-mode position too, highlighting an uptrend. Bearish conditions in WTI futures remain intact and recent gains still appear to be a correction. Resistance to watch is $76.06, the 50-day EMA. A clear break of this hurdle would strengthen a bullish theme and highlight a stronger reversal.
• The uptrend in Bund futures remains intact and the contract traded higher Wednesday, confirming a resumption of the trend and an extension of the recent break of resistance at 135.81, Dec 7 high. The move higher maintains the bullish price sequence of higher highs and higher lows. The current uptrend in Gilt futures remains intact and the contract gapped higher Thursday. This confirms once again, a resumption of the underlying uptrend and maintains a bullish price sequence of higher highs and higher lows.

EURUSD TECHS: Bullish Pennant Formation

• RES 4: 1.1081 76.4% retracement of the Jul 18 - Oct 3 downleg
• RES 3: 1.1065 High Aug 10
• RES 2: 1.1017 High Nov 29 and the bull trigger
• RES 1: 1.1009 High Dec 14
• PRICE: 1.0953 @ 08:09 GMT Dec 21
• SUP 1: 1.0864/1.0804 20- and 50-day EMA values
• SUP 2: 1.0724 Low Dec 8 and the bear trigger
• SUP 3: 1.0693 Low Nov 14
• SUP 4: 1.0665 61.8% retracement of the Oct 3 - Nov 29 rally

The recovery in EURUSD that started on Dec 8 is a bullish development and the latest consolidation appears to be a pennant - a bullish continuation signal. The rally suggests scope for a test of key short-term resistance at 1.1017, the Nov 29 high and a bull trigger. Moving average studies remain in a bull-mode position, highlighting an uptrend. Key support has been defined at 1.0724, the Dec 8 low. Initial support is at 1.0872, the 20-day EMA.

GBPUSD TECHS: Pullback Considered Corrective

• RES 4: 1.2996 High Jul 27
• RES 3: 1.2881 76.4% retracement of the Jul 14 - Oct 4 bear leg
• RES 2: 1.2819 High Aug 10
• RES 1: 1.2800 High Aug 22
• PRICE: 1.2644 @ 06:08 GMT Dec 21
• SUP 1: 1.2603 20-day EMA
• SUP 2: 1.2500 Low Dec 13 and key support
• SUP 3: 1.2449 Low Nov 22
• SUP 4: 1.2374 Low Nov 17

The trend outlook in GBPUSD remains bullish and recent weakness is considered corrective. Moving average studies are in a bull-mode set-up, highlighting a rising trend. Key resistance and the bull trigger at 1.2733, the Nov 29 high, has recently been cleared, confirming a resumption of the uptrend. Sights are on 1.2800 next, the Aug 22 high. Initial firm support to watch is 1.2603, the 20-day EMA.

EURGBP TECHS: Has Cleared The 50-Day EMA

• RES 4: 0.8768 High Nov 20 and key resistance
• RES 3: 0.8716 76.4% retracement of the Nov 20 - Dec 11 sell-off
• RES 2: 0.8684 61.8% retracement of the Nov 20 - Dec 11 sell-off
• RES 1: 0.8669 High Dec 20
• PRICE: 0.8662 @ 06:21 GMT Dec 21
• SUP 1: 0.8571/8549 Low Dec 15 / 11 and the bear trigger
• SUP 2: 0.8524 Low Sep 5
• SUP 3: 0.8493 Low Aug 23 and a key support
• SUP 4: 0.8433 2.0% 10-dma envelope

EURGBP traded sharply higher Wednesday and in the process breached resistance at 0.8645, the 50-day EMA. A clear break of this average highlights a stronger short-term reversal and signals potential for a continuation higher - for now. Sights are on 0.8684 next, a Fibonacci retracement point. On the downside, key support is unchanged at 0.8549, the Dec 11 low.

USDJPY TECHS: Bear Threat Remains Present

• RES 4: 148.51 High Nov 30
• RES 3: 147.32 High Dec 7
• RES 2: 146.59 High Dec 11 and key short-term resistance
• RES 1: 144.96/145.26 High Dec 19 / 76.4% of the Dec 11 - 14 sell-off
• PRICE: 143.09@ 06:36 GMT Dec 21
• SUP 1: 142.25 Low Dec 19
• SUP 2: 140.97/71 Low Dec 14 / 76.4% of the Jul 14 - Nov 13 bull run
• SUP 3: 140.23 2.00 proj of the Nov 13 - 21 - 22 price swing
• SUP 4: 139.11 1.764 proj of the Nov 13 - 21 - 22 price swing

USDJPY remains below Tuesday’s high. The recovery from 140.97, the Dec 14 low, appears to be a correction - for now. Recent weakness reinforces current bearish conditions. On Dec 14, the pair breached support at 141.71, the Dec 7 low, to confirm a resumption of the downtrend that started on Nov 13. Sights are on 140.71, a Fibonacci retracement point. Key short-term resistance has been defined at 146.59, the Dec 11 high.

EURJPY TECHS: Trend Needle Points South

• RES 4: 161.78 High Dec 1
• RES 3: 159.93 High Dec 4
• RES 2: 159.01 50-day EMA
• RES 1: 158.67 High Dec 12
• PRICE: 156.64 @ 06:56 GMT Dec 21
• SUP 1: 155.39/153.23 Low Dec 19 / 7 and the bear trigger
• SUP 2: 152.24 3.764 proj of the Nov 16 - 21 - 27 price swing
• SUP 3: 151.42 Low Jul 28 and a key support
• SUP 4: 150.92 Low Jun 14

EURJPY traded sharply higher Tuesday breaching resistance at 157.68, the Dec 11 high. The next key hurdle to watch is 158.67, the Dec 12 high, which remains intact for now. Clearance of this level would signal a short-term reversal. Below 158.67, the latest recovery appears to be a correction and trend signals remain bearish. A resumption of weakness and a break of 153.23, the Dec 7 low and bear trigger, would resume the downtrend.

AUDUSD TECHS: Bullish Trend Conditions

• RES 4: 0.6900 High Jun 16 and a key resistance
• RES 3: 0.6847 High Jul 20
• RES 2: 0.6821 High Jul 27
• RES 1: 0.6779 High Dec 20
• PRICE: 0.6744 @ 07:30 GMT Dec 21
• SUP 1: 0.6655 Low Dec 14
• SUP 2: 0.6628/6526 20-day EMA / Low Dec 07 and key support
• SUP 3: 0.6494 Low Nov 20
• SUP 4: 0.6453 Low Nov 17

Bullish trend conditions in the AUDUSD remain intact. This week’s gains mark an extension of last week’s move higher and the break of resistance at 0.6691, the Dec 4 high and a bull trigger. Scope is seen for a climb for a climb towards the 0.6800 handle and 0.6821, the Jul 27 high. On the downside, key short-term support is unchanged at 0.6526, the Dec 7 low. Initial firm support is at 0.6628, the 20-day EMA.

USDCAD TECHS: Southbound

• RES 4: 1.3777 High Nov 16
• RES 3: 1.3712 High Nov 24
• RES 2: 1.3619 High Dec 7 and 12 and key short-term resistance
• RES 1: 1.3415/3518 High Dec 15 / 20-day EMA
• PRICE: 1.3355 @ 07:53 GMT Dec 21
• SUP 1: 1.3312 Low Dec 20
• SUP 2: 1.3283 76.4% retracement of the Jul 14 - Nov 1 bull phase
• SUP 3: 1.3206 2.0% 10-dma envelope
• SUP 4: 1.3184 Low Aug 1

The USDCAD trend outlook remains bearish and the continuation lower this week reinforces this condition. The pair has recently cleared the bear trigger at 1.3480, the Dec 4 low. That break confirmed a resumption of the downtrend and maintains the price sequence of lower lows and lower highs. Sights are on 1.3283, a Fibonacci retracement. On the upside, key short-term resistance has been defined at 1.3619, the Dec 7 / 12 high.

FIXED INCOME

BUND TECHS: (H4) Bull Trend Extends

• RES 4: 139.04 3.618 proj of the Nov of the 13 - 17 - 24 price swing
• RES 3: 138.76 3.50 proj of the Nov of the 13 - 17 - 24 price swing
• RES 2: 138.49 3.382 proj of the Nov of the 13 - 17 - 24 price swing
• RES 1: 138.12 High Dec 20
• PRICE: 137.97 @ 05:28 GMT Dec 21
• SUP 1: 136.59 Low Dec 18
• SUP 2: 135.81/134.89 Low Dec 15 / 20-day EMA
• SUP 3: 134.37 Low Dec 8 and a key support
• SUP 4: 133.42 Low Dec 4

The uptrend in Bund futures remains intact and the contract traded higher Wednesday, confirming a resumption of the trend and an extension of the recent break of resistance at 135.81, Dec 7 high. The move higher maintains the bullish price sequence of higher highs and higher lows. Sights are on 138.49, a Fibonacci projection. Key short-term support has been defined at 134.37, the Dec 8 low. A short-term pullback would be considered corrective.

BOBL TECHS: (H4) Uptrend Extends

• RES 4: 120.130 High Mar 24 (cont)
• RES 3: 120.00 Psychological round number
• RES 2: 119.832 0.764 proj of the Nov 24 - Dec 7 - 8 price swing
• RES 1: 119.460 High Dec 21
• PRICE: 119.360 @ 05:44 GMT Dec 21
• SUP 1: 118.330 Low Dec 15
• SUP 2: 117.989 20-day EMA
• SUP 3: 117.800 Low Dec 8 and a key support
• SUP 4: 117.510 Low Dec 4

A bull cycle in Bobl futures remains in play and the contract traded higher yesterday. The continuation higher confirms, once again, confirms a resumption of the uptrend and maintains the bullish price sequence of higher highs and higher lows. The focus is on 119.832, a Fibonacci projection point. On the downside, key short-term support has been defined at 117.800, the Dec 8 low. A pullback would be considered corrective.

SCHATZ TECHS: (H4) Fresh Trend High

• RES 4: 106.774 1.618 proj of the Nov 24 - 30 minor price swing
• RES 3: 106.698 1.50 proj of the Nov 24 - 30 minor price swing
• RES 2: 106.621 1.382 proj of the Nov 24 - 30 minor price swing
• RES 1: 106.527 1.236 proj of the Nov 24 - 30 minor price swing
• PRICE: 106.475 @ 05:57 GMT Dec 21
• SUP 1: 106.160/060 Low Dec 15 / 20-day EMA
• SUP 2: 105.955 Low Dec 13 and key short-term support
• SUP 3: 105.780 Low Dec 1
• SUP 4: 105.640 Low Nov 29

Trend conditions in Schatz futures remain bullish and this week’s gains reinforce current conditions. The contract has cleared 106.495, the Dec 14 high. This confirms a resumption of the uptrend and maintains the positive price sequence of higher highs and higher lows. Sights are on 106.527, a Fibonacci projection. Key short-term support has been defined at 105.955, Dec 13 low. A pullback would be considered corrective.

GILT TECHS: (H4) Impulsive Bull Run Extends

• RES 4: 104.00 Psychological round number
• RES 3: 103.81 2.236 proj of the Nov 30 - Dec 6 - Dec 11 price swing
• RES 2: 103.44 76.4% of the Mar 20 - Oct 23 downleg (cont)
• RES 1: 103.13 2.00 proj of the Nov 30 - Dec 6 - Dec 11 price swing
• PRICE: 102.78 @ Close Dec 20
• SUP 1: 100.93 Low Dec 18
• SUP 2: 100.20 High Dec 13 and gap high
• SUP 3: 99.10 20-day EMA
• SUP 4: 98.97 High Dec 6 and a recent breakout level

The current uptrend in Gilt futures remains intact and the contract gapped higher Thursday. This confirms once again, a resumption of the underlying uptrend and maintains a bullish price sequence of higher highs and higher lows. The focus is on 103.13 next, a Fibonacci projection. Initial firm support lies at 100.20, the Dec 13 high. Short-term weakness would be considered corrective.

BTP TECHS: (H4) Bulls Remain In The Driver's Seat

• RES 4: 122.18 3.00 proj of the Nov 10 - 17 - 24 price swing
• RES 3: 121.43 2.764 proj of the Nov 10 - 17 - 24 price swing
• RES 2: 120.97 2.618 proj of the Nov 10 - 17 - 24 price swing
• RES 1: 120.60 2.50 proj of the Nov 10 - 17 - 24 price swing
• PRICE: 120.05 @ Close Dec 20
• SUP 1: 118.54/117.18 Low Dec 18 / High Dec 13 and gap high
• SUP 2: 115.70 Low Dec 8 and key short-term support
• SUP 3: 114.13 Low Nov 30
• SUP 4: 112.70 Low Nov 24

A bull cycle in BTP futures remains in play and the contract traded higher yesterday. This reinforces bullish conditions and confirms a resumption of the uptrend. The contract has recently cleared resistance at 117.22, Dec 7 high and a bull trigger. The breach maintains the positive price sequence of higher highs and higher lows. Sights are on the 120.60, a Fibonacci projection. On the downside, key S/T support has been defined at 115.70, the Dec 8 low.

EQUITIES

EUROSTOXX50 TECHS: (H4) Corrective Cycle Remains In Play

• RES 4: 4697.50 1.382 projection of the Nov 8 - 24 - 28 price swing
• RES 3: 4662.90 1.236 projection of the Nov 8 - 24 - 28 price swing
• RES 2: 4636.70 76.4% retracement of the 2000 - 2009 downleg (cont)
• RES 1: 4634.00 High Dec 14
• PRICE: 4550.00 @ 05:55 GMT Dec 21
• SUP 1: 4530.00 Low Dec 20
• SUP 2: 4503.90 20-day EMA
• SUP 3: 4447.00 Low Dec 5
• SUP 4: 4370.00 Low Nov 28

A bullish theme in Eurostoxx 50 futures remains intact and the latest pullback appears to be a correction. Recent gains confirmed, once again, a resumption of the uptrend and this has maintained the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull-mode position too, signalling a rising cycle. The focus is on 4636.70, a long-term Fibonacci retracement. Support to watch is at 4503.90, the 20-day EMA.

E-MINI S&P TECHS: (H4) Corrective Pullback

• RES 4: 4915.11 1.236 proj of Nov 10 - Dec 1 - 7 price swing
• RES 3: 4900.00 Round number resistance
• RES 2: 4854.75 1.00 proj of Nov 10 - Dec 1 - 7 price swing
• RES 1: 4830.75 High Dec 20
• PRICE: 4769.75 @ 07:14 GMT Dec 21
• SUP 1: 4743.25 Low Dec 20
• SUP 2: 4681.74 20-day EMA
• SUP 3: 4594.00 Low Nov 30
• SUP 4: 4583.18 50-day EMA

A bullish theme in S&P e-minis remains intact and yesterday’s abrupt sell-off appears to be a correction - for now. This week’s fresh trend highs, confirm once again a resumption of the uptrend that started Oct 27. The contract has recently cleared resistance at 4738.50, the Jul 27 high, reinforcing current positive trend conditions. Sights are on 4854.75 next, a Fibonacci projection. On the downside, initial firm support lies at 4681.74, the 20-day EMA.

COMMODITIES

BRENT TECHS: (G4) Watching Resistance

• RES 4: $87.12 - High Nov 3
• RES 3: $87.00 - Round number resistance
• RES 2: $84.61 - High Nov 30 and key short-term resistance
• RES 1: $80.56 - 50-day EMA
• PRICE: $79.69 @ 06:56 GMT Dec 21
• SUP 1: $75.76 - Low Dec 18
• SUP 2: $72.29/71.45 - Low Dec 13 and the bear trigger / Low Jun 23
• SUP 3: $69.86 - Low May 4 and a key support
• SUP 4: $66.90 - 1.236 proj of the Oct 20 - Nov 16 - 30 price swing

Brent futures traded high again Wednesday, extending the current corrective cycle. Resistance to watch is $80.56, the 50-day EMA. A clear break of this EMA is required to signal a stronger reversal. On the downside, a reversal lower would signal the end of the correction and refocus attention of the key support and bear trigger at $72.29, the Dec 13 low. A break of this level would open $71.45 nex, the Jun 23 low.

WTI TECHS: (G4) Gains Considered Corrective

• RES 4: $82.64 - High Nov 3
• RES 3: $79.67 - High Nov 30 and a key short-term resistance
• RES 2: $76.06 - 50-day EMA
• RES 1: $75.37 - High Dec 20
• PRICE: $74.21 @ 07:08 GMT Dec 21
• SUP 1: $70.99 - Low Dec 18
• SUP 2: $67.98/07 - Low Dec 13 and the bear trigger / Low Jun 23
• SUP 3: $65.24 - Low May 4 and a key support
• SUP 4: $63.79 - 2.236 proj of the Sep 28 - Oct 6 - Oct 20 price swing

Bearish conditions in WTI futures remain intact and recent gains still appear to be a correction. Resistance to watch is $76.06, the 50-day EMA. A clear break of this hurdle would strengthen a bullish theme and highlight a stronger reversal. For bears, moving average studies are in a bear-mode position, highlighting a downtrend. The bear trigger lies at $67.98, the Dec 13 low. A break of this level would open $65.24, the May 4 low and a key support.

GOLD TECHS: Bullish Outlook

• RES 4: $2177.6 - 1.236 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 3: $2135.4 - High Dec 4 and all-time high
• RES 2: $2073.4 - 61.8% retracement of the Dec 4 - 13 bear leg
• RES 1: $2054.30- 50.0% retracement of the Dec 4 - 13 bear leg
• PRICE: $2035.7 @ 07:11 GMT Dec 21
• SUP 1: $1973.2 - Low Dec 13
• SUP 2: $1931.7 - Low Nov 13 and key support
• SUP 3: $1908.3 - Low Oct 16
• SUP 4: $1868.8 - Low Oct 13

Gold is in consolidation mode. The Dec 13 reversal signals the end of the recent Dec 4 - 13 corrective pullback and highlights a bullish theme. MA studies are in a bull-mode position too, highlighting an uptrend. A continuation higher would signal scope for a climb towards key resistance and the Dec 4 all-time high of $2135.4. A break of this level would resume the primary bull trend. Initial firm support lies at $1973.2, the Dec 13 low.

SILVER TECHS: Bullish Engulfing Candle Remains In Play

• RES 4: $26.397 - 1.50 proj of the Oct 3 - 20 - Nov 13 price swing
• RES 3: $26.222 - High Apr 18 2022
• RES 2: $26.135 - High May 5 and a key resistance
• RES 1: $24.519/25.761 - 61.8% of Dec 4 - 13 bear leg / High Dec 4
• PRICE: $24.267 @ 07:58 GMT Dec 21
• SUP 1: $22.510 - Low Dec 13 and key short-term support
• SUP 2: $21.883 - Low Nov 13 and a key support
• SUP 3: $20.689 - Low Oct 3 and the bear trigger
• SUP 4: $19.904 - Low Mar 10 and a key support

Silver rallied on Dec 13, highlighting a reversal and yesterday’s push higher reinforces a developing bullish theme. The Dec 13 price pattern appears to be a bullish engulfing candle. If correct, this signals potential for a continuation of the upleg. Sights are on $24.519, a Fibonacci retracement. Key resistance is at $25.761, the Dec 4 high. Key support lies at $22.510, the Dec 13 low.