MNI DAILY TECHNICAL ANALYSIS - Gilt Futures Remain Vulnerable

Price Signal Summary – Gilt Futures Remain Vulnerable

• The trend direction in the S&P E-Minis remains down and price is trading closer to recent lows. The contract has recently broken below the 50-day EMA. This reinforces the bearish theme and signals scope for a continuation, with attention on 3902.01 next, a Fibonacci retracement. EUROSTOXX 50 futures remain bearish and traded to a fresh short-term trend low yesterday. The contract has cleared 3456.00, the 76.4% retracement of the Jul 5 - Aug 17 rally. The clear break strengthens bearish conditions and exposes the key support at 3343.00.
• EURUSD remains in a downtrend and the pair traded lower Monday and through support at 0.9901, the Aug 23 low. The break lower confirms a resumption of the downtrend and sets the scene for a bearish extension inside the bear channel, drawn from the Feb 10 high. The USDJPY trend needle still points north following strong gains last week and this week’s continuation higher. The climb reinforces current bullish conditions and has put prices well north of former resistance at 139.39, the Jul 14 high. A bearish theme in AUDUSD remains intact. The extension lower last week has strengthened bearish conditions and confirmed a resumption of the bear leg that started Aug 11. Price has breached 0.6789, 76.4% of the Jul 14 - Aug 11 upleg.
• Gold remains in a clear short-term downtrend and last week’s extension reinforced bearish conditions. Support at $1727.8, Aug 22 low has been breached to confirm a resumption of the bear cycle. A bearish threat in WTI futures remains present following last week’s sharp sell-off. A strong reversal pattern appeared on the daily chart - a bearish engulfing candle on Aug 30.
• Bund futures traded lower yesterday and remain in bear mode following last week's extension lower. Short-term gains are considered corrective. The contract continues to retrace the bull leg between Jun 16 - Aug 2. Gilt futures remain vulnerable and the bearish impulsive run that started early August, remains intact as price trades to fresh trend lows. The breach last week of support at 108.94, the Aug 24 low, confirmed a resumption of the downtrend.

FOREIGN EXCHANGE

EURUSD TECHS: Bear Cycle Still In Play

• RES 4: 1.0268 High Aug 15
• RES 3: 1.0184 High Aug 18 and Channel top from the Feb 10 high
• RES 2: 1.0090 High Aug 26 and key near-term resistance
• RES 1: 1.0045 20-day EMA
• PRICE: 0.9945 @ 06:05 BST Sep 6
• SUP 1: 0.9883/78 1.764 proj of Jun 9-15-27 swing / Low Sep 5
• SUP 2: 0.9800 Round number support
• SUP 3: 0.9785 2.00 projection of the Jun 9 - 15 - 27 price swing
• SUP 4: 0.9646 Channel base drawn from the Feb 10 high

EURUSD remains in a downtrend and the pair traded lower Monday and through support at 0.9901, the Aug 23 low. The break lower confirms a resumption of the downtrend and sets the scene for a bearish extension inside the bear channel, drawn from the Feb 10 high. The move lower also maintains the bearish price sequence of lower lows and lower highs. The focus is on the 0.9800 handle next.

GBPUSD TECHS: Bearish Price Sequence

• RES 4: 1.1981 50-day EMA
• RES 3: 1.1901 High Aug 26 and key resistance
• RES 2: 1.1788 20-day EMA
• RES 1: 1.1624/1760 High Sep 1 / Low Jul 14 and recent breakout lvl
• PRICE: 1.1563 @ 06:11 BST Sep 6
• SUP 1: 1.1444/1412 Low Sep 5 / Low Mar 20 2020 and major support
• SUP 2: 1.1324 1.50 proj of the Jun 16 - Jul 14 - Aug 1 price swing
• SUP 3: 1.1300 Round number support
• SUP 4: 1.1248 1.618 proj of the Jun 16 - Jul 14 - Aug 1 price swing

The current downtrend in GBPUSD remains intact and yesterday’s initial weakness reinforces current conditions. The pair has recovered however short-term gains are considered corrective. A bearish sequence of lower lows and lower highs remains intact. Note that trend is oversold however this does not appear to be a concern for bears. The focus is on 1.1412 next, Mar 20 2020 low and a major support. Firm resistance is at 1.1788, the 20-day EMA.

EURGBP TECHS: Corrective Pullback

• RES 4: 0.8840 High Feb 2
• RES 3: 0.8811 1.236 proj of the Apr 14 - Jun 15 - Aug 2 price swing
• RES 2: 0.8721 High Jun 15 and a medium-term bull trigger
• RES 1: 0.8679 High Jul 1
• PRICE: 0.8601 @ 07:22 BST Sep 6
• SUP 1: 0.8572 Low Aug 31
• SUP 2: 0.8524 20-day EMA
• SUP 3: 0.8496 50-day EMA
• SUP 4:0.8408 Low Aug 23

EURGBP remains in an uptrend following last week’s gains and the latest pullback is considered corrective. The cross has recently cleared a number of short-term resistance points and attention is on 0.8679, the Jul 1 high. Clearance of this level would expose the key resistance at 0.8721, the Jun 15 high and an important bull trigger. On the downside, initial support is seen at 0.8572, the Aug 31 low.

USDJPY TECHS: Continues To Climb

• RES 4: 144.00 Round number resistance
• RES 3: 143.30 2.23 proj of the Aug 2 - 8 - 11 price swing
• RES 2: 142.08 2.00 proj of the Aug 2 - 8 - 11 price swing
• RES 1: 140.97 Intraday high
• PRICE: 140.88 @ 06:48 BST Sep 6
• SUP 1: 138.86/05 Low Sep 1 / Low Aug 30
• SUP 2: 137.53 20-day EMA
• SUP 3: 135.79 50-day EMA
• SUP 4: 134.65 Low Aug 18

The USDJPY trend needle still points north following strong gains last week and this week’s continuation higher. The climb reinforces current bullish conditions and has put prices well north of former resistance at 139.39, the Jul 14 high. Last week’s break higher also confirmed a resumption of the primary uptrend. Sights are on 142.08 next, a Fibonacci projection. Initial firm support is at 137.53, the 20-day EMA.

EURJPY TECHS: Finds Support

• RES 4: 142.32 High Jul 21 and key resistance
• RES 3: 141.92 1.382 pro of the Aug 2 - 10 - 16 price swing
• RES 2: 141.19 1.236 pro of the Aug 2 - 10 - 16 price swing
• RES 1: 140.75 High Sep 2 and a bull trigger
• PRICE: 140.39 @ 06:53 BST Sep 6
• SUP 1: 138.69/14 Low Sep 5 / 50-day EMA
• SUP 2: 137.03 Low Aug 29
• SUP 3: 136.02 Low Aug 25
• SUP 4: 135.52 Low Aug 24

EURJPY traded lower Monday but has recovered from the session low. A bullish theme remains intact following last week’s price developments and the breach of a trendline resistance, drawn from the Jun 28 high. The break strengthens bullish conditions and highlights a stronger reversal from the Aug 2 low. This has opened 141.19 next, a Fibonacci projection and 142.32, the Jul 21 high. Initial firm support is at 138.14, the 50-day EMA.

AUDUSD TECHS: Key Support Remains Exposed

• RES 4: 0.7040 High Aug 16
• RES 3: 0.7009 High Aug 26 and a key short-term resistance
• RES 2: 0.6934 50-day EMA
• RES 1: 0.6855/6894 High Sep 2 / 20-day EMA
• PRICE: 0.6794 @ 07:06 BST Sep 6
• SUP 1: 0.6771 Low Sep 1
• SUP 2: 0.6719 Low Jul 15
• SUP 3: 0.6682 Low Jul 14 and the bear trigger
• SUP 4: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing

A bearish theme in AUDUSD remains intact. The extension lower last week has strengthened bearish conditions and confirmed a resumption of the bear leg that started Aug 11. Price has breached 0.6789, 76.4% of the Jul 14 - Aug 11 upleg. This opens 0.6682, the Jul 14 low and a key support plus an important bear trigger. On the upside, key short-term resistance is unchanged at 0.7009, Aug 26 high.

USDCAD TECHS: Key Resistance Still Exposed

• RES 4: 1.3315 2.0% 10-dma envelope
• RES 3: 1.3300 High Nov 4 2020
• RES 2: 1.3224 High Jul 14 and key resistance
• RES 1: 1.3208 High Sep 1
• PRICE: 1.3127 @ 07:18 BST Sep 6
• SUP 1: 1.3063/1.3011 High Aug 23 / 20-day EMA
• SUP 2: 1.2940 50-day EMA
• SUP 3: 1.2895 Low Aug 25 and key near-term support
• SUP 4: 1.2828 Low Aug 17

The USDCAD bull theme remains intact despite the latest corrective pullback. Attention is on 1.3224, a key resistance and the Jul 14 high. A break would be viewed as an important bullish development. Note that moving average studies are in a bull mode set-up, highlighting a broader uptrend. Initial firm support is at 1.2895 where a break would alter the picture. First support lies at 1.3063, the Aug 23 high and a recent breakout level.

FIXED INCOME

BUND TECHS: (Z2) Trend Direction Remains Down

• RES 4: 149.81 High Aug 23
• RES 3: 148.97 High Aug 25
• RES 2: 148.00 Round number resistance
• RES 1: 146.90 High Aug 30
• PRICE: 145.51 @ 05:11 BST Sep 6
• SUP 1: 144.39 Low Sep 1 and the bear trigger
• SUP 2: 143.64 2.382 proj of the Aug 2 - 12 - 15 price swing
• SUP 3: 143.12 2.50 proj of the Aug 2 - 12 - 15 price swing
• SUP 4: 142.60 2.61.8 proj of the Aug 2 - 12 - 15 price swing

Bund futures traded lower yesterday and remain in bear mode following last week's extension lower. Short-term gains are considered corrective. The contract continues to retrace the bull leg between Jun 16 - Aug 2 and a bearish price sequence of lower lows and lower highs remains intact. The bear trigger is 144.39, Sep 1 low, where a break would resume bearish activity. The focus is on 143.64. Resistance is at 146.90, the Aug 30 high.

BOBL TECHS: (Z2) Trend Needle Points South

• RES 4: 125.200 High Aug 25
• RES 3: 124.670 High Aug 25
• RES 2: 124.00 Round number resistance
• RES 1: 123.650 High Aug 30
• PRICE: 123.060 @ 05:11 BST Sep 6
• SUP 1: 122.230 Low Sep 1 and the bear trigger
• SUP 2: 122.022 76.4% retracement of the Jun 16 - Aug 2 rally (cont)
• SUP 3: 120.990 Low Jun 21 (cont)
• SUP 4: 119.940 Low Jun 16 and key support (cont)

Bobl futures remain bearish and the latest bounce is considered corrective. Attention is on 122.230, the Sep 1 low and near-term bear trigger. A break would confirm a resumption of the current bear cycle and continue the retracement of the mid-June to early August climb. Scope is seen for a move to 120.990 next, the Jun 21 low (cont). On the upside, initial resistance is at 123.650, the Aug 30 high.

SCHATZ TECHS: (Z2) Bear Threat Still Present

• RES 4: 109.280 High Aug 17
• RES 3: 109.000 Round number resistance
• RES 2: 108.845 High Aug 25
• RES 1: 108.445 High Aug 30
• PRICE: 108.255 @ 05:36 BST Sep 6
• SUP 1: 107.925 Low Sep 1 and the bear trigger
• SUP 2: 107.821 0.618 proj of the Aug 25 - Sep 1 - Sep 2 price swing
• SUP 3: 107.687 0.764 proj of the Aug 25 - Sep 1 - Sep 2 price swing
• SUP 4: 107.470 1.00 proj of the Aug 25 - Sep 1 - Sep 2 price swing

Schatz futures remain above last week’s 107.925 low (Sep 1). The trend direction remains down. A break of 107.925 would confirm a resumption of bearish activity and maintain the current bearish sequence of lower lows and lower highs. The focus is on 107.687, a Fibonacci projection. On the upside, initial resistance is seen at 108.445, the Aug 30 high. Short-term gains would be considered corrective.

GILT TECHS: (Z2) Bear Cycle Extends

• RES 4: 112.43 High Aug 22
• RES 3: 111.54 High Aug 23
• RES 2: 109.47/110.85 High Aug 31 / 26 and key near-term resistance
• RES 1: 107.93 High Sep 1
• PRICE: 106.79 @ Close Sep 5
• SUP 1: 106.03 1.382 projection of the Aug 22 - 24 - 26 price swing
• SUP 2: 105.62 1.50 projection of the Aug 22 - 24 - 26 price swing
• SUP 3: 105.00 round number support
• SUP 4: 104.69 1.764 projection of the Aug 22 - 24 - 26 price swing

Gilt futures remain vulnerable and the bearish impulsive run that started early August, remains intact as price trades to fresh trend lows. The breach last week of support at 108.94, the Aug 24 low, confirmed a resumption of the downtrend and this also resulted in a print below the 107.00 handle. Attention is on 106.03 next, a Fibonacci projection. Firm short-term resistance has been defined at 110.85, the Aug 26 high.

BTP TECHS: (Z2) Heading South

• RES 4: 122.59 High Aug 19
• RES 3: 121.32 High Aug 25
• RES 2: 120.00 Round number resistance
• RES 1: 119.47 High Aug 30
• PRICE: 117.19 @ Close Sep 5
• SUP 1: 116.37 Low Sep 1 and the bear trigger
• SUP 2: 115.00 Round number support
• SUP 3: 113.78 Low Jun 14 and key support
• SUP 4: 111.62 1.236 proj of the Aug 25 - Sep 1 - 5 price swing

Bearish conditions in BTP futures remain intact - last week's fresh lows reinforce the current bear cycle. Furthermore, a bearish price sequence of lower lows and lower highs remains intact as the contract continues its retracement of the mid-June - early August rally. The focus is on the 115.00 handle next ahead of the major support at 113.78, Jun 14 low (cont). On the upside, initial resistance is seen at 119.47, Aug 30 high.

US 10YR FUTURE TECHS: (Z2) Bear Threat Remains Present

• RES 4: 119-18 High Aug 17
• RES 3: 118-15 50-day EMA
• RES 2: 117-29/118-00 20-day EMA / High Aug 26
• RES 1: 117-07+ High Aug 31
• PRICE: 116-11 @ 15:56 BST Sep 5
• SUP 1: 115-23 Low Sep 1 and the bear trigger
• SUP 2: 114-26 Low Jun 16
• SUP 3: 114-06 Low Jun 14 and a key support
• SUP 4: 114-00 Round number support

Treasuries remain vulnerable despite the modest bounce on Friday, with the bearish theme still intact for now. The recent breach of 117-11+, Jul 21 low, reinforced bearish conditions and the subsequent follow through has resulted in the break of 116-01+, 61.8% of the Jun 14 - Aug 2 rally. The break supports the case for a move back to 114-06, Jun 14 low. Initial firm resistance has been defined at 118-00, Aug 26 high.

EQUITIES

EUROSTOXX50 TECHS: (U2) Bearish Outlook

• RES 4: 3822/40.00 High Aug 17 / High Jun 6 and key resistance zone
• RES 3: 3782.00 High Aug 18
• RES 2: 3705.00 High Aug 26 and key near-term resistance
• RES 1: 3459.00/3622.2 High Sep 2 / 50-day EMA
• PRICE: 3486.00@ 05:30 BST Sep 6
• SUP 1: 3429.00 Low Sep 5
• SUP 2: 3386.00 Low Jul 15
• SUP 3: 3362.00 Low Jul 14
• SUP 4: 3343.00 Low Jul 5 and the bear trigger

EUROSTOXX 50 futures remain bearish and traded to a fresh short-term trend low yesterday. The contract has cleared 3456.00, the 76.4% retracement of the Jul 5 - Aug 17 rally. The clear break strengthens bearish conditions and exposes the key support at 3343.00, Jul 5 low. Clearance of 3343.00 would confirm a resumption of the broader downtrend. Initial resistance is seen at 3549.00, Friday's high.

E-MINI S&P (U2): Southbound

• RES 4: 4327.50 High Aug 16 and the bull trigger
• RES 3: 4288.00 High Aug 19
• RES 2: 4217.25 High Aug 26 and key short-term resistance
• RES 1: 4067.49 50-day EMA
• PRICE: 3940.50 @ 06:48 BST Sep 6
• SUP 1: 3902.01 61.8% retracement of the Jun 17 - Aug 16 upleg
• SUP 2: 3834.00 Low Jul 19
• SUP 3: 3801.49 76.4% retracement of the Jun 17 - Aug 16 upleg
• SUP 4: 3723.75 Low Jul 14

The trend direction in the S&P E-Minis remains down and price is trading closer to recent lows. The contract has recently broken below the 50-day EMA. This reinforces the bearish theme and signals scope for a continuation, with attention on 3902.01 next, a Fibonacci retracement. Clearance of this level would strengthen bearish conditions. Initial firm resistance is at 4067.49, the 50-day EMA.

COMMODITIES

BRENT TECHS: (X2) Bear Threat Remains Present

• RES 4: $110.17 - High Jun 29
• RES 3: $107.30 - High Jul 5
• RES 2: $103.86 - High Jul 29 and key resistance
• RES 1: $98.01 - 50-day EMA
• PRICE: $95.04 @ 06:51 BST Sep 6
• SUP 1: $91.81 - Low Sep 1
• SUP 2: $90.95 - Low Aug 17
• SUP 3: $89.06 - Low Jul 14 and the key bear trigger
• SUP 4: $87.50 - Low Mar 15

Brent futures remain vulnerable following last week’s sharp reversal and despite yesterday’s gains. A continuation lower would expose the next important support at $90.95, the Aug 17 low, ahead of $89.06, the Jul 14 low and a key bear trigger. Moving average studies continue to highlight a broader bear cycle. Key resistance is at $103.48, the Jul 29 high, where a break is needed to reinstate a bull theme.

WTI TECHS: (V2) Key Support Still Exposed

• RES 4: $108.07 - High Jun 29
• RES 3: $105.00 - High Jul 5
• RES 2: $99.75 - High Jul 29 and key resistance
• RES 1: $93.48/97.66 - 50-day EMA / High Aug 30
• PRICE: $88.72 @ 06:58 BST Sep 6
• SUP 1: $85.98 - Low Sep 1
• SUP 2: $85.37 - Low Aug 16 and the bear trigger
• SUP 3: $84.10/00 - Low Mar 15 / Round number support
• SUP 4: $81.88 - Low Feb 25

A bearish threat in WTI futures remains present following last week’s sharp sell-off. A strong reversal pattern appeared on the daily chart - a bearish engulfing candle on Aug 30. This pattern suggests potential for a stronger sell-off near-term that initially exposes key support at $85.37, the Aug 16 low and a bear trigger. Firm resistance has been defined at $97.66, Aug 30 high, where a break is required to resume bullish activity.

GOLD TECHS: Bearish Trend Outlook

• RES 4: $1783.2 - High Aug 16
• RES 3: $1765.5 - High Aug 25 and a key resistance
• RES 2: $1739.0 - 20-day EMA
• RES 1: $1726.7 - Intraday high
• PRICE: $1716.9 @ 07:12 BST Sep 6
• SUP 1: $1681.0 - Low Jul 21 and the bear trigger
• SUP 2: $1676.9 - Low Mar 8 2021
• SUP 3: $1671.0 - Low Jun 5 2020
• SUP 4: $1657.1 - 0.764 proj of the Jun 13 - Jul 21 - Aug 10 swing

Gold remains in a clear short-term downtrend and last week’s extension reinforced bearish conditions. Support at $1727.8, Aug 22 low has been breached to confirm a resumption of the bear cycle. The break lower paves the way for weakness towards $1681.0, the Jul 21 low and a key bear trigger. A break would confirm a resumption of the broader downtrend that started early March. Initial firm resistance is seen at $1739.0, the 20-day EMA.

SILVER TECHS: Bear Trend Still In Play

• RES 4: $21.540 - High Jun 27
• RES 3: $20.876 - High Aug 15 and the bull trigger
• RES 2: $18.938/19.644- 20- and 50-day EMA values
• RES 1: $18.544 - High Aug 31
• PRICE: $18.347 @ 07:22 BST Sep 6
• SUP 1: $17.562 - Low Sep 1 and the bear trigger
• SUP 2: $16.955 - Low Jun 15 2020
• SUP 3: $16.473 - 1.00 proj of the Jun 6 - Jul 14 - Aug 10 price swing
• SUP 4: $15.998 - 76.4% retracement of the 2020 - 2021 bull leg

The Silver outlook remains bearish and short-term gains are considered corrective. Last week’s sell-off confirms a resumption of the bear leg that started Aug 15 - the metal has cleared support at $18.146, the Jul 14 low and bear trigger. The break lower also maintains the bearish price sequence of lower lows and lower highs. The focus is on $16.955 next, the Jun 15 2020 low. Initial firm resistance is seen at $18.544, the Aug 31 high.