MNI DAILY TECHNICAL ANALYSIS - Gilt Rally Deemed Corrective
Price Signal Summary – Gilt Rally Deemed Corrective
- S&P E-Minis trend conditions are unchanged and the outlook remains bullish. 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 4944.00. A clear break of this average would undermine a recent bullish theme and highlight a stronger reversal.
- GBPUSD traded sharply lower Wednesday and remains soft. The break lower confirms a resumption of the current bear cycle. Note that an important support at 1.3002, the Sep 11 low, has been breached. USDJPY maintains a firmer tone and the pair is holding on to its recent gains. The recent break of the break of the 50-day EMA, marks a bullish development that undermines a bearish theme and highlights a stronger reversal.AUDUSD has traded lower this week and the pair maintains a softer tone. Price has recently traded through both the 20- and 50-day EMAs. The move down undermines a bullish theme and exposes 0.6622, the Sep 11 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 unchanged and remains bullish. Moving average studies are in a bull-mode set-up too, highlighting a clear uptrend. WTI futures gapped lower Tuesday and this resulted in a break of the Oct 9 low. A bearish extension 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.
- A bearish theme in Bund futures remains intact and gains are for now, considered corrective. However, the contract has breached the 20- and 50-day EMAs. A continuation higher would be a bullish development and highlight a possible reversal. A bear cycle in Gilt futures remains present and the latest recovery is considered corrective - for now. Note that short-term gains are allowing an oversold trend condition to unwind. The contract is approaching resistance at 98.11, the Sep 2 low.
FOREIGN EXCHANGE
EURUSD TECHS: Bear Cycle Extends
- RES 4: 1.1144 High Oct 1
- RES 3: 1.1083 High Oct 2
- RES 2: 1.0995 20-day EMA
- RES 1: 1.0917 High Oct 17
- PRICE: 1.0854 @ 05:58 BST Oct 17
- SUP 1: 1.0851 Intraday low
- 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 and the pair continues to trade lower this week. MA 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. 1.0881, the 76.4% retracement of the Aug 1 - Sep 25 bull leg has been breached and this opens 1.0778, the Aug 1 low and the next key support. Initial firm resistance is at 1.0995 the 20-day EMA.
GBPUSD TECHS: Bear Cycle Remains In Play
- RES 4: 1.3434 High Sep 26 and key resistance
- RES 3: 1.3389 High Oct 1
- RES 2: 1.3274 High Oct 3 and the bull trigger
- RES 1: 1.3077/3136 High Oct 16 / 20-day EMA
- PRICE: 1.2985 @ 06:12 BST Oct 17
- SUP 1: 1.2977 Low Oct 16
- 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 traded sharply lower Wednesday and remains soft. The break lower 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 1.3136, 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: 0.8358 @ 06:25 BST Oct 17
- 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 gains are seen corrective for now, with moving average studies in bear-mode position - highlighting a dominant downtrend. 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 highlights 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: Bullish Outlook
- 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: 149.50 @ 06:54 BST Oct 17
- SUP 1: 148.30/147.09 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 maintains a firmer tone and the pair is holding on to its recent gains. The recent break of the break of the 50-day EMA, marks a bullish development that undermines a 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 147.09, the 20-day EMA. Clearance of this level would signal a reversal.
EURJPY TECHS: Resistance Remains Intact For Now
- 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: 162.27 @ 07:03 BST Oct 17
- SUP 1: 161.71 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 is unchanged and continues to trade inside its recent range. A medium-term bearish trend condition remains intact and this suggests the recovery since early August is corrective. A reversal lower would open 158.11, the Sep 30 low, and the first important support. Key resistance is unchanged at 163.49, the Sep 27 high (pierced), and 163.89, the Aug 15 high. Clearance of both levels would highlight a potential reversal.
AUDUSD TECHS: Bearish Tone
- 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: 0.6763 20-day EMA
- PRICE: 0.6684 @ 07:28 BST Oct 17
- SUP 1: 0.6658 Low Oct 16
- 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 has traded lower this week and the pair maintains a softer tone. Price has recently traded through both the 20- and 50-day EMAs. The move down undermines a bullish theme and exposes 0.6622, the Sep 11 low and a key support. Clearance of this level would strengthen a bearish theme and open 0.6576, a Fibonacci retracement. Key resistance has been defined at 0.6942, the Sep 30 high. Initial resistance is 0.6763, the 20-day EMA.
USDCAD TECHS: Bull Cycle Remains Intact
- RES 4: 1.4000 Round number resistance
- RES 3: 1.3967 2.0% 10-dma envelope
- RES 2: 1.3946 High Aug 5 and a key resistance
- RES 1: 1.3839 High Oct 15
- PRICE: 1.3775 @ 07:54 BST Oct 17
- SUP 1: 1.3725/3648 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
The USDCAD trend outlook remains bullish. Recent short-term gains confirm an extension of the bull cycle that started Sep 25. The pair has pierced 1.3822, 76.4% 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 1.3648, the 20-day EMA. A pullback would be considered corrective and allow an overbought condition to unwind.
FIXED INCOME
BUND TECHS: (Z4) Trades Through Its Moving Averages
- RES 4: 135.24 High Oct 3
- RES 3: 134.88 61.8% retracement of the Oct 1 - 10 bear leg
- RES 2: 134.48 50.0% retracement of the Oct 1 - 10 bear leg
- RES 1: 134.25 High Oct 16
- PRICE: 133.99 @ 05:31 BST Oct 17
- SUP 1: 133.30/132.75 Low Oct 15 / 10 and the bear trigger
- 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 gains are for now, considered corrective. However, the contract has breached the 20- and 50-day EMAs. A continuation higher would be a bullish development and highlight a possible reversal, signalling scope for an extension. This would open 134.48, a Fibonacci retracement. 132.75, the Oct 10 low, marks key support and bear trigger. A break would resume the recent bearish theme.
BOBL TECHS: (Z4) Recovers From Its Recent Lows
- RES 4: 120.190 High Oct 3
- RES 3: 119.875 61.8% retracement of the Oct 1 - 10 bear leg
- RES 2: 119.635 50.0% retracement of the Oct 1 - 10 bear leg
- RES 1: 119.500 High Oct 16
- PRICE: 119.350 @ 05:50 BST Oct 17
- SUP 1: 119.010/118.620 Low Oct 15 / 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. Note that the cross has traded through its 20-day EMA. An extension would signal scope for a climb towards 119.635, a Fibonacci retracement point. For bears, a reversal lower would refocus attention on 118.620, the Oct 10 low and a bear trigger. A break of this level would resume the recent bear trend.
SCHATZ TECHS: (Z4) Testing Resistance At The 20-Day EMA
- RES 4: 107.110 High Oct 4
- RES 3: 107.047 61.8% retracement of the Oct 1 / 10 bear leg
- RES 2: 106.958 50.0% retracement of the Oct 1 / 10 bear leg
- RES 1: 106.905 High Oct 16
- PRICE: 106.855 @ 06:06 BST Oct 17
- SUP 1: 106.580/705 Low Oct 14 / 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. This suggests that the latest recovery is a correction. A resumption of bearish price action would refocus attention on 106.580, the Oct 10 low, where a break would expose 106.520, the Sep 3 low and a key support. The contract is testing resistance at 106.886, the 20-day EMA. A breach of this average would signal scope for a stronger recovery.
GILT TECHS: (Z4) Monitoring Resistance
- RES 4: 100.19 76.4% retracement of the Sep 17 - Oct 10 bear leg
- RES 3: 99.47 High Oct and key short-term resistance
- RES 2: 98.68 50.0% retracement of the Sep 17 - Oct 10 bear leg
- RES 1: 98.11 Low Sep 2 and a key near-term resistance
- PRICE: 97.99 @ Close Oct 16
- SUP 1: 96.97/95.83 High Oct 15 and gap low / 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 - for now. Note that short-term gains are allowing an oversold trend condition to unwind. The contract is approaching resistance at 98.11, the Sep 2 low. A continuation higher and a break of 98.11 would open 98.68, a Fibonacci retracement. For bears, a reversal would refocus attention on key support at 95.83, Oct 10 low. A break of it resumes a bearish theme.
BTP TECHS: (Z4) Rally Exposes Key Resistance
- 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: 121.90/122.62 High Oct 16 / 1 and the bull trigger
- PRICE: 121.87 @ Close Oct 16
- SUP 1: 120.24/119.97 20-day EMA / Low Oct 11 and key support
- 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. This week’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) Bearish Threat
- 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: 4927.00 @ 06:27 BST Oct 17
- SUP 1: 4914.00 Low Oct 16
- 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 4944.00. 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 of this level would resume the uptrend.
EQUITY TECHS: E-MINI S&P: (Z4) Trend Needle Points North
- 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: 5886.50 @ 07:12 BST Oct 17
- SUP 1: 5799.11/5724.00 20-day EMA / Low Oct 2
- SUP 2: 5715.30 50-day EMA
- SUP 3: 5675.25 Low Sep 18
- SUP 4: 5658.00 Low Sep 13
S&P E-Minis trend conditions are unchanged and the outlook remains bullish. 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 Remains Present
- 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: $74.34 @ 07:03 BST Oct 17
- 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 is trading closer to its latest lows. The move down resulted in a break of last week’s low. A bearish extension 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 resistance at $81.16, the Oct 7 high. Clearance of this level resumes 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: $70.53 @ 07:09 BST Oct 17
- SUP 1: $69.64 - Low Oct 16
- 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 Tuesday and this resulted in a break of the Oct 9 low. A bearish extension 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: Bulls Remain In The Driver’s Seat
- 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: $2682.1 @ 07:16 BST Oct 17
- SUP 1: $2631.1/2604.9 - 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 unchanged and remains bullish. Moving average studies are in a bull-mode set-up too, highlighting a clear uptrend. Sights are on $2690.2, a Fibonacci projection. Firm support lies at $2631.1, 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: $31.506 @ 08:04 BST Oct 17
- SUP 1: $30.394 - 50-day EMA
- SUP 2: $29.388 - 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. Support to watch is at the 50-day EMA, at $30.394. A clear break of this average 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.