MNI DAILY TECHNICAL ANALYSIS - GBPUSD Outlook Remains Bearish

Price Signal Summary – GBPUSD Outlook Remains Bearish

• EUROSTOXX 50 futures remain in a bear mode. The contract has this week cleared former support at 3608.00, Apr 27 low to highlight a resumption of the current bear cycle. This sets the scene for an extension lower and opens 3458.90, a Fibonacci retracement. S&P E-Minis remain vulnerable following last week’s sharp reversal from 4303.00, May 4 high, and this week’s extension of the downtrend. Monday’s move lower resulted in a breach of support at 4056.00, May 2 low.
• EURUSD is rangebound. The pause in the downtrend still appears to be a bear flag formation. This is a bearish continuation pattern that also highlights a shallow correction and reinforces the current trend direction. GBPUSD is unchanged and is still trading closer to its recent lows. The outlook remains bearish. The recent breach of 1.2412, Apr 28 low, confirmed a bear flag breakout on the daily frequency and a resumption of the downtrend. The USDJPY outlook remains bullish. The pair probed resistance at 131.25 on Monday, the Apr 28 high. A clear break of this level would confirm a resumption of the uptrend and open the next objective at 131.96, a Fibonacci projection.
• Gold remains vulnerable and yesterday’s move lower confirms a resumption of the current downtrend. The sell-off has resulted in a break of $1848.8, 76.4% of the Jan 28 - Mar 8 rally. This paves the way for a move towards $1821.1 next, the Feb 11 low. WTI futures reversed course Monday. Last week’s break of triangle resistance, drawn from the Mar 15 low, highlighted a bullish development. However the sell-off this week suggests the bullish break was likely a false one.
• Trend signals in Bund futures are unchanged and the outlook is bearish. Fresh cycle lows Monday reinforce this condition and confirm, once again, a resumption of the primary downtrend and an extension of the bearish price sequence of lower lows and lower highs. The Gilt futures trend condition remains bearish and short-term gains are considered corrective. Moving average studies continue to point south and the dominant bearish price sequence of lower lows and lower highs remains intact.

FOREIGN EXCHANGE

EURUSD TECHS: Bear Flag Formation Reinforces Downtrend

• RES 4: 1.0936 High Apr 21 and a key resistance
• RES 3: 1.0852 High Apr 22
• RES 2: 1.0657/0758 20-day EMA / Low Apr 14 - recent breakout level
• RES 1: 1.0642 High May 5
• PRICE: 1.0543 @ 06:08 BST May 11
• SUP 1: 1.0472/54 Low Apr 28 and the bear trigger / Low Jan 1 2017
• SUP 2: 1.0390 Low Jan 4 2017
• SUP 3: 1.0341 Low Jan 3 2017 and a key support
• SUP 4: 1.0333 1.236 proj of the Feb 10 - Mar 7 - 31 price swing

EURUSD is rangebound. The pause in the downtrend still appears to be a bear flag formation. This is a bearish continuation pattern that also highlights a shallow correction and reinforces the current trend direction. Furthermore, moving average studies remain in a bear mode set-up. A resumption of weakness would open 1.0454, the Feb 22 2017 low. Watch resistance at 1.0657, the 20-day EMA.

GBPUSD TECHS: Trading Near Its Recent Lows

• RES 4: 1.2877 High Apr 25
• RES 3: 1.2772 High Apr 26
• RES 2: 1.2638 High May 4 and a key resistance
• RES 1: 1.2406 High May 9
• PRICE: 1.2336 @ 06:14 BST May 11
• SUP 1: 1.2252 Low Jun 29 2020
• SUP 2: 1.2200 Round number support
• SUP 3: 1.2162 Low May 22 2020
• SUP 4: 1.2081 76.4% retracement of the Mar ‘20 - Jun ‘21 uptrend

GBPUSD is unchanged and is still trading closer to its recent lows. The outlook remains bearish. The recent breach of 1.2412, Apr 28 low, confirmed a bear flag breakout on the daily frequency and a resumption of the downtrend. The break lower signals scope for weakness towards 1.2252 next, the Jun 29 2020 low. Key short-term resistance is unchanged at 1.2638, the May 4 high. A break would signal a possible base.

EURGBP TECHS: Holding On To Its Recent Gains

• RES 4: 0.8658 High Sep 29 2021
• RES 3: 0.8624/35 High Oct 1 2021 / 2.0% 10-dma envelope
• RES 3: 0.8600 High Dec 8 2021
• RES 1: 0.8591 High May 6
• PRICE: 0.8549 @ 07:35 BST May 11
• SUP 1: 0.8468 High Apr 27 and a recent breakout level
• SUP 2: 0.8399/67 50-day EMA / Low May 2
• SUP 3: 0.8313 Low Apr 22
• SUP 4: 0.8250 Low Apr 14 and a key support

EURGBP is holding on to its recent gains. The outlook remains bullish following last week’s climb to 0.8591. The recent rally reinforces a bullish theme and marks an extension of the bull cycle that started from 0.8250, the Apr 14 low. This signals scope for a climb towards the 0.8600 handle next. On the downside, key short-term support is unchanged at 0.8367, the May 2 low. Initial support is seen at 0.8468, Apr 27 high.

USDJPY TECHS: Trend Remains Up

• RES 4: 133.11 High Apr 4 2002
• RES 3: 132.39 High Apr 15 2002
• RES 2: 131.96 1.00 proj of the Feb 24 - Mar 28 - 31 price swing
• RES 1: 131.35 High May 9 and the bull trigger
• PRICE: 130.31 @ 06:39 BST May 11
• SUP 1: 128.44 20-day EMA
• SUP 2: 126.95 Low Apr 27 and a key support
• SUP 3: 125.09 Low Apr 14
• SUP 4: 124.01 Low Apr 11

The USDJPY outlook remains bullish. The pair probed resistance at 131.25 on Monday, the Apr 28 high. A clear break of this level would confirm a resumption of the uptrend and open the next objective at 131.96, a Fibonacci projection. A move higher would also maintain a bullish price sequence of higher highs and higher lows. Key support has been defined at 126.95, Apr 27 low. A break would signal a reversal. Initial firm support is at 128.22.

EURJPY TECHS: Key Support Levels Remain Intact

• RES 4: 141.06 High Jun 4 2015 and a key resistance
• RES 3: 140.98 3.0% 10-dma envelope
• RES 2: 140.87 0.50 proj of the Mar 7 - 28 - Apr 5 price swing
• RES 1: 138.32/140.00 High May 9 / High Apr 21 and the bull trigger
• PRICE: 137.25 @ 16:33 BST May 10
• SUP 1: 137.46 Low May 11
• SUP 2: 135.00/134.30 50-day EMA / Low Apr 5 and a key support
• SUP 3: 132.95 Low Mar 24
• SUP 4: 132.33 Low Mar 23

EURJPY is unchanged. The cross continues to consolidate and is holding on to its most recent gains. Short-term pullbacks are considered corrective and the current uptrend remains intact. The 50-day EMA, represents a key support. It intersects at 135.00, just above another key support at 134.30, Apr 5 low. While these levels hold, the trend outlook remains bullish. The bull trigger is 140.00, the Apr 21 high.

AUDUSD TECHS: Heading South

• RES 4: 0.7379 High Apr 22
• RES 3: 0.7266 High May 4/5 and key resistance
• RES 2: 0.7258 50-day EMA
• RES 1: 0.7030/7135 Low May 2 / High May 6
• PRICE: 0.6955 @ 06:54 BST May 11
• SUP 1: 0.6911 Low May 10
• SUP 2: 0.6876 0.618 proj of the Apr 5 - May 2 - 4 price swing
• SUP 3: 0.6833 Low Jun 30 2020
• SUP 4: 0.6805 Low Jun 22 2020

AUDUSD maintains a bearish tone and has this week resumed its downtrend. The failure at 0.7266 last week, high May 4/5, and the sharp reversal from this level reinforces a bearish theme. Moving average studies are in a bear mode too, highlighting current sentiment. Support at 0.6968, the Jan 28 low and a bear trigger, has been breached. This opens 0.6876 next, a Fibonacci projection. Short-term gains are considered corrective.

USDCAD TECHS: Bull Cycle Intact

• RES 4: 1.3173 High Nov 13 2020
• RES 3: 1.3126 2.0% 10-dma envelope
• RES 2: 1.3091 High Nov 24 2020
• RES 1: 1.3052 High May 10
• PRICE: 1.3009 @ 07:00 BST May 11
• SUP 1: 1.2914/2814 High May 2 / Low May 6
• SUP 2: 1.2714/2701 Low May 5 / 50-day EMA
• SUP 3: 1.2568 Low Apr 22
• SUP 4: 1.2459 Low Apr 21

USDCAD traded higher again Tuesday. This week’s gains have resulted in a breach of resistance at 1.2914, May 2 high, and key resistance at 1.2964, the Dec 20 2021 high. The break of the latter level marks an important medium-term bullish technical development and reinforces the broader bullish outlook. This has opened 1.3126 next, the upper band of a MA envelope. Initial support is seen at 1.2914. Key support lies at 1.2714, the Apr 29 low.

FIXED INCOME

BUND TECHS: (M2) Corrective Bounce

• RES 4: 157.87 High Apr 7
• RES 3: 157.32 50-day EMA
• RES 2: 156.00 High Apr 28 and a key short-term resistance
• RES 1: 153.17/154.15 High May 6 / 20-day EMA
• PRICE: 152.67 @ 05:11 BST May 11
• SUP 1: 150.49 Low May 9
• SUP 2: 150.15 0.764 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 3: 150.00 Psychological round number
• SUP 4: 149.49 Low Jul 13 2015 (cont)

Trend signals in Bund futures are unchanged and the outlook is bearish. Fresh cycle lows Monday reinforce this condition and confirm, once again, a resumption of the primary downtrend and an extension of the bearish price sequence of lower lows and lower highs. Moving average studies remain in a bear mode. Attention is on 150.15 next, a Fibonacci projection. Firm resistance is at 156.00, the Apr 28 high. Gains are considered corrective.

BOBL TECHS: (M2) Trend Conditions Remain Bearish

• RES 4: 129.350 High Apr 4 and a reversal point
• RES 3: 128.830 High Apr 7
• RES 2: 128.310 High Apr 14/28 and a key near-term resistance
• RES 1: 127.451 20-day EMA
• PRICE: 127.100 @ 05:16 BST May 11
• SUP 1: 126.010 Low May 6
• SUP 2: 126.00 Round number support
• SUP 3: 125.450 0.618 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 4: 125.260 Low Apr 24 20014 (cont)

Bobl futures are trading above recent lows. Gains are considered corrective. A fresh cycle low Monday reinforces the primary downtrend and maintains the broader bearish price sequence of lower lows and lower highs. Moving average studies continue to point south, highlighting current sentiment. Scope is seen for weakness towards 125.450 next, a Fibonacci projection. Key short-term trend resistance is at 128.310, the Apr 14/28 high.

SCHATZ TECHS: (M2) Trades Above Its 20-Day EMA

• RES 4: 110.855 High Apr 4
• RES 3: 110.731 50-day EMA
• RES 2: 110.540 High Apr 28 and a key resistance
• RES 1: 110.435 High May 10
• PRICE: 110.360 @ 05:23 BST May 11
• SUP 1: 109.980 Low May 6 and the bear trigger
• SUP 2: 109.777 0.618 proj of the Mar 7 - 30 - Apr 4 price swing
• SUP 3: 109.555 Low Oct 31 2011 (cont)
• SUP 4: 109.340 Low Oct 28 011 (cont)

The trend direction in Schatz futures remains down and short-term gains are considered corrective. The contract has traded above its 20-day EMA and an extension would open 110.540, the Apr 28 high and a key resistance. A resumption of weakness would refocus attention on the bear trigger at 109.980, May 6 low. A break would confirm a resumption of the primary downtrend and open 109.777 next, a Fibonacci projection.

GILT TECHS: (M2) Resistance Remains Intact

• RES 4: 122.35 High Apr 4
• RES 3: 120.96 High Apr 6
• RES 2: 120.21 50-day EMA
• RES 1: 119.79 High Apr 25 and key resistance
• PRICE: 119.14 @ Close May 10
• SUP 1: 116.87 Low May 9 and the bear trigger
• SUP 2: 116.35 Low Dec 30 2015 (cont)
• SUP 3: 115.40 1.00 proj of the Mar 1 - 28 - Apr 4 price swing
• SUP 4: 115.00 Round number support

The Gilt futures trend condition remains bearish and short-term gains are considered corrective. Moving average studies continue to point south and the dominant bearish price sequence of lower lows and lower highs remains intact. Resistance has been defined at 119.79, Apr 26 high where a break is required to signal a base. Monday’s print below 117.22, Apr 22 low, reinforced bearish conditions. The trigger for a continuation lower is 116.87, May 9 low.

BTP TECHS: (M2) Trend Needle Still Points South

• RES 4: 134.94/135.23 50-day EMA / High Apr 14
• RES 3: 133.53 High Apr 28
• RES 2: 130.80 20-day EMA
• RES 1: 130.03 High Jun 5
• PRICE: 127.74 @ Close May 10
• SUP 1: 125.54 Low May 9
• SUP 2: 125.02 1.236 proj of the Mar 1 - 29 - 31 price swing
• SUP 3: 124.02 Low Mar 18 2020 (cont) and a major support
• SUP 4: 123.41 1.382 proj of the of the Mar 1 - 29 - 31 price swing

The trend condition in BTP futures is unchanged and the outlook remains bearish - a fresh cycle low print Monday reinforces this theme. The move lower maintains the broader bearish price sequence of lower lows and lower highs that defines a downtrend. Moving average studies are in a bear mode too and the focus is on 125.02 next, a Fibonacci projection. Firm short-term resistance has been defined at 133.53, the Apr 28 high.

EQUITIES

EUROSTOXX50 TECHS: (M2) Outlook Remains Bearish

• RES 4: 3944.00 High Mar 29 and a key resistance
• RES 3: 3883.00 High Apr 21
• RES 2: 3775.00 High Jun 5
• RES 1: 3678.10 20-day EMA
• PRICE: 3550.00 @ 05:45 BST May 11
• SUP 1: 3466.00 Low May 10
• SUP 2: 3458.90 76.4% retracement of the Mar 7 - 29 rally
• SUP 3: 3400.00 Round number support
• SUP 4: 3309.00 Low Mar 7 and a major support

EUROSTOXX 50 futures remain in a bear mode. The contract has this week cleared former support at 3608.00, Apr 27 low to highlight a resumption of the current bear cycle. This sets the scene for an extension lower and opens 3458.90, a Fibonacci retracement. A break of this level would open 3309.00, the Mar 7 low and a major support. On the upside, firm resistance has been defined at 3775.00, Jun 5 high. A break of this level would alter the picture.

E-MINI S&P (M2): Remains Vulnerable

• RES 4: 4509.00 High Apr 21 and a key short-term resistance
• RES 3: 4393.25 High Apr 22
• RES 2: 4328.66 50-day EMA
• RES 1: 4099.00/4303.50 High May 9 / High Apr 26/28
• PRICE: 4010.25 @ 06:57 BST May 11
• SUP 1: 3953.00 Low May 10
• SUP 2: 3892.98 2.23 proj of the Mar 29 - Apr 18 - 21 price swing
• SUP 3: 3843.25 Low Mar 25 2021 (cont)
• SUP 4: 3820.25 2.50 proj of the Mar 29 - Apr 18 - 21 price swing

S&P E-Minis remain vulnerable following last week’s sharp reversal from 4303.00, May 4 high, and this week’s extension of the downtrend. Monday’s move lower resulted in a breach of support at 4056.00, May 2 low. A clear break of this support confirms a resumption of the underlying downtrend and opens 3892.98 next, a Fibonacci projection. On the upside, key resistance has been defined at 4303.50, the Apr 26/28 high.

COMMODITIES

BRENT TECHS: (N2) Support Remains Exposed

• RES 4: $123.44 - High Mar 8
• RES 3: $121.13 - 76.4% retracement of the Mar 7 - 15 downleg
• RES 2: $115.76 - High Mar 24 and a bull trigger
• RES 1: $106.58/114.00 - 20-day EMA / High May 5
• PRICE: $104.75 @ 07:01 BST May 11
• SUP 1: $101.30 - Intraday low
• SUP 2: $99.25 - Low Apr 25 and a key near-term support
• SUP 3: $97.18 - Low Apr 11
• SUP 4: $92.59 - Low Mar 15 and a bear trigger

Brent futures have failed to hold on to recent highs. Last week’s break of triangle resistance, drawn from the Mar 15 low, highlighted a bullish development. However the sell-off Monday and Tuesday, suggests the bullish break was a false one. This threatens the recent recovery and exposes support at $99.25, Apr 25 low. A break would strengthen a bearish case and confirm a bearish triangle breakout. Key resistance is at $114.00, May 5 high.

WTI TECHS: (M2) Bearish Risk Still Present

• RES 4: $119.95 - High Mar 8
• RES 3: $118.13 - High Mar 9
• RES 2: $113.51/113.90 - High Mar 24 / 76.4% of Mar 7 - 15 downleg
• RES 1: $103.56/111.37 - 20-day EMA / High May 5
• PRICE: $102.09 @ 07:14 BST May 11
• SUP 1: $98.20 - Intraday low
• SUP 2: $95.28 - Low Apr 25 and a key near-term support
• SUP 3: $92.60 - Low Apr 11 and a key support
• SUP 4: $90.37 - Low Mar 15 and a bear trigger

WTI futures reversed course Monday. Last week’s break of triangle resistance, drawn from the Mar 15 low, highlighted a bullish development. However the sell-off this week suggests the bullish break was likely a false one. This threatens the recent recovery and instead exposes support at $95.28, Apr 25 low. A break would strengthen a bearish case and confirm a bearish triangle breakout. Key resistance is at $111.37, the May 5 high.

GOLD TECHS: Resumes Its Downtrend

• RES 4: $1998.4 - High Apr 18 and a bull trigger
• RES 3: $1958.4 - High Apr 20
• RES 2: $1909.8/1919.9 - High May 5 / High Apr 29
• RES 1: $1865.4 - High May 10
• PRICE: $1840.4 @ 07:20 BST May 11
• SUP 1: $1832.1 - Intraday low
• SUP 2: $1821.1 - Low Feb 11
• SUP 3: $1780.4 - Low Jan 28 and a key support
• SUP 4: $1753.7 - Low Dec 15 2021

Gold remains vulnerable and yesterday’s move lower confirms a resumption of the current downtrend. The sell-off has resulted in a break of $1848.8, 76.4% of the Jan 28 - Mar 8 rally. This paves the way for a move towards $1821.1 next, the Feb 11 low. Sights are also set on $1780.4, the Jan 28 low. On the upside, $1909.8, the May 5 high, is seen as the initial firm resistance. A break would signal a possible short-term reversal.

SILVER TECHS: Clears Support

• RES 4: $26.943 - High Mar 8 and the bull trigger
• RES 3: $26.222 - High Apr 18 and a key short-term resistance
• RES 2: $25.293 - High Apr 20
• RES 1: $23.255/942.051.142 - 20-day EMA / 50-day EMA
• PRICE: $21.642@ 08:04 BST May 11
• SUP 1: $21.186 - Low May 10
• SUP 2: $20.983 - 1.764 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 3: $20.871 - 50.0% retracement of the Mar - Aug 2020 bull cycle
• SUP 4: $20.000 - Psychological round number

Silver remains bearish and the metal started the week on a softer note, trading lower Monday and again on Tuesday. Support at $22.008, the Feb 3 low and a bear trigger, has been breached. The move lower reinforces the bearish theme and has also resulted in a break of $21.427/423, the Dec 15 2021 low and Sep 29 2021 low. Sights are on $20.983, a Fibonacci projection. Firm short-term resistance is at $23.255, the 20-day EMA.