MNI DAILY TECHNICAL ANALYSIS - Gilts Clear Support, Reinforcing Bearish Theme

Price Signal Summary – Gilt futures clear support, reinforcing bearish theme

• The uptrend in S&P E-Minis remains intact and Friday’s gains confirmed a resumption of the trend. Resistance at 4841.50, the Dec 28 high has been cleared, marking an extension of the price sequence of higher highs and higher lows. Eurostoxx 50 futures last week breached support at the Jan 5 low of 4444.0, trading to a low of 4402.00, the Jan 17 low. The contract has since recovered and 4402.00 represents a key short-term support. A break of this level would resume bearish pressure and open 4370.00.
• EURUSD maintains a short-term bearish tone. Last week’s move lower resulted in the break of a trendline drawn from the Nov 1 low, signalling scope for a continuation of the corrective cycle. Note that price action since Jan 17 appears to be a flag formation - a bearish continuation signal. A bear threat in EURGBP remains present and the cross is trading closer to its recent lows. Moving average studies are in a bear-mode position highlighting a clear downtrend for now. AUDUSD maintains a softer tone following last week’s bearish price action and recent gains are considered corrective. The pair last week breached a trendline drawn from the late October low.
• Gold remains above the Jan 17 low of $2001.9. Last week’s print below the 50-day EMA and the break of support at $2013.4, the Jan 11 low, has strengthened a bearish threat and a resumption of weakness would open a key level at $1973.2. Trend signals in WTI futures remain bearish and recent short-term gains are considered corrective. Resistance to watch is $74.23, the 50-day EMA. It has been pierced, a clear break would strengthen a bullish theme and expose $76.31, the Dec 26 high.
• Bund futures traded lower last week and the contract remains in a bear-mode. The move down strengthens the current bear trend and reinforces the short-term importance of the recent break below the 20-day EMA. Gilt futures last week cleared support at 99.60, the Jan 5 low. This reinforced a bearish theme and confirmed a resumption of the downtrend that started Dec 27. The contract has also traded through support at 97.97, the Dec 6 high signalling scope for an extension towards 97.39.

EURUSD TECHS: Bear Flag

• RES 4: 1.1139 High Dec 28 and the bull trigger
• RES 3: 1.1077 76.4% retracement of the Dec 28 - Jan 5 sell-off
• RES 2: 1.1046 High Jan 2
• RES 1: 1.0932/98 20-day EMA / High Jan 5
• PRICE: 1.0901 @ 05:46 GMT Jan 22
• SUP 1: 1.0845 Low Jan 17
• SUP 2: 1.0793 50.0% retracement of the Oct - Dec bull leg
• SUP 3: 1.0724 Low Dec 8
• SUP 4: 1.0712 61.8% retracement of the Oct - Dec bull leg

EURUSD maintains a short-term bearish tone. Last week’s move lower resulted in the break of a trendline drawn from the Nov 1 low, signalling scope for a continuation of the corrective cycle. Note that price action since Jan 17 appears to be a flag formation - a bearish continuation signal. A resumption of weakness would open 1.0793, a Fibonacci retracement. Firm resistance is at 1.0998, Jan 5 high. A break would signal a reversal.

GBPUSD TECHS: Remains Above Last Week’s Low

• RES 4: 1.2996 High Jul 27
• RES 3: 1.2881 76.4% retracement of the Jul 14 - Oct 4 bear leg
• RES 2: 1.2827 High Dec 28 and the bull trigger
• RES 1: 1.2737 High Jan 16
• PRICE: 1.2724 @ 06:03 GMT Jan 22
• SUP 1: 1.2597 Low Jan 17 and key short-term support
• SUP 2: 1.2525 38.2% retracement of the Oct 4 - Dec 28 bull phase
• SUP 3: 1.2500 Low Dec 13
• SUP 4: 1.2432 50.0% retracement of the Oct 4 - Dec 28 bull phase

GBPUSD traded lower last week but has managed to recover from 1.2597, the Jan 17 low. The pair has recently pierced key short-term support at 1.2611, the Jan 2 low and traded through the 50-day EMA, at 1.2621. A clear breach of both support points would highlight a short-term top and signal scope for a deeper retracement, opening 1.2500, the Dec 13 low. Key resistance is 1.2827, the Dec 28 high. A break would resume the uptrend.

EURGBP TECHS: Support Remains Exposed

• RES 4: 0.8768 High Nov 20
• RES 3: 0.8715 High Dec 28 and the bull trigger
• RES 2: 0.8676 High Jan 3
• RES 1: 0.8630 50-day EMA
• PRICE: 0.8576 @ 06:35 GMT Jan 22
• SUP 1: 0.8549 Low Dec 11 and the bear trigger
• SUP 2: 0.8524 Low Sep 5
• SUP 3: 0.8493 Low Aug 23 2023 and a key medium-term support
• SUP 4: 0.8454 61.8% of the Mar 7 - Sep 26 ‘23 bull phase

A bear threat in EURGBP remains present and the cross is trading closer to its recent lows. Moving average studies are in a bear-mode position highlighting a clear downtrend for now. Sights are on key support at 0.8549, the Dec 11 low. Key resistance is unchanged at 0.8715, the Dec 28 high. The 50-day EMA, at 0.8630, is the initial firm resistance to watch. Clearance of the EMA would ease bearish pressure.

USDJPY TECHS: Bulls Remain In The Driver’s Seat

• RES 4: 150.78 High Nov 17
• RES 3: 149.75 High Nov 22
• RES 2: 149.16 76.4% retracement of the Nov 13 - Dec 28 bull leg
• RES 1: 148.80 High Jan 19
• PRICE: 148.07@ 06:46 GMT Jan 22
• SUP 1: 147.08 Low Jan 17
• SUP 2: 145.67/45.17 50- and 20-day EMA values
• SUP 3: 144.36 Low Jan 12 and key S/T support
• SUP 4: 143.42 Low Jan 9

USDJPY maintains a bullish tone and last week’s gains reinforce current conditions. Resistance at 146.41, the Jan 11 high, has recently been cleared, confirming a resumption of the bull cycle. The move higher opens 149.16 next, a Fibonacci retracement. On the downside, a key short-term support has been defined at 144.36, the Jan 12 low. Clearance of this level is required to signal a top. Initial support lies at 147.08, the Jan 17 low.

EURJPY TECHS: Holding On To Its Recent Gains

• RES 4: 164.30 High Nov 16 and key resistance
• RES 3: 163.72 High Nov 27
• RES 2: 162.25 High Nov 29
• RES 1: 161.86 High Jan 19
• PRICE: 161.51 @ 07:05 GMT Jan 22
• SUP 1: 159.98/158.55 Low Jan 17 / 12 and a key short-term support
• SUP 2: 157.21 Low Jan 9
• SUP 3: 155.08/153.23 Low Jan 02 / Dec 07 and bear trigger
• SUP 4: 152.24 3.764 proj of the Nov 16 - 21 - 27 price swing

Last week’s rally in EURJPY strengthened a short-term bullish condition and resulted in a breach of 160.18, the Jan 11 high. The break confirms a resumption of the uptrend and the cross is holding on to its recent gains. Note that 161.69, 76.4% of the Nov 16 - Dec 7 bear leg, has been pierced. A clear break would open 162.25, the Nov 29 high. Initial firm support lies at 158.55, the Jan 12 low.

AUDUSD TECHS: Watching Support

• RES 4: 0.6900 High Jun 16 and a key resistance
• RES 3: 0.6871 High Dec 28 and the bull trigger
• RES 2: 0.6729/71 High Jan 12 / 3
• RES 1: 0.6637 50-day EMA
• PRICE: 0.6589 @ 07:52 GMT Jan 22
• SUP 1: 0.6526/25 Low Dec 7 and key support / Low Jan 17
• SUP 2: 0.6500 61.8% Fibonacci retracement for Oct - Dec upleg
• SUP 3: 0.6453 Low Nov 17
• SUP 4: 0.6412 76.4% Fibonacci retracement for Oct - Dec upleg

AUDUSD maintains a softer tone following last week’s bearish price action and recent gains are considered corrective. The pair last week breached a trendline drawn from the late October low. The break strengthens a bearish theme and signals scope for a deeper correction. Attention is on 0.6526, the Dec 7 low and the next key support. A clear break would open 0.6500, a Fibonacci retracement. Initial resistance is at 0.6667, the 50-day EMA.

USDCAD TECHS: Bulls Remain In The Driver’s Seat

• RES 4: 1.3661 High Nov 27
• RES 3: 1.3623 61.8% retracement of the Nov 1 - Dec 27 bear leg
• RES 2: 1.3608 High Dec 13
• RES 1: 1.3542 High Jan 17
• PRICE: 1.3435 @ 08:04 GMT Jan 22
• SUP 1: 1.3409/3343 20-day EMA / Low Jan 12
• SUP 2: 1.3288/3177 Low Jan 5 / Low Dec 27
• SUP 3: 1.3093 Low Jul 14 and key support
• SUP 4: 1.3158 2.0% 10-dma envelope

USDCAD maintains a firmer tone and the latest pullback is considered corrective. Last week’s gains resulted in a move above the 50-day EMA, at 1.3458, confirming an extension of the corrective bull cycle that started Dec 27 and has exposed 1.3538, 50.0% of the Nov 1 - Dec 27 bear leg. This level has been pierced, a clear break would open 1.3608, the Dec 13 high. Support to watch is 1.3343, Jan 12 low. Initial support is 1.3409, the 20-day EMA.

FIXED INCOME

BUND TECHS: (H4) Remains In Bear-Mode

• RES 4: 139.39 3.764 proj of the Nov of the 13 - 17 - 24 price swing
• RES 3: 137.96/138.84 High Jan 4 / High Dec 27 and the bull trigger
• RES 2: 136.16 High Jan 5 / 8
• RES 1: 135.34 20-day EMA
• PRICE: 134.50 @ 05:23 GMT Jan 22
• SUP 1: 133.71 Low Jan 19
• SUP 2: 133.42 Low Dec 4
• SUP 3: 132.89 50.0% retracement of the Oct 4 - Dec 27 bull phase
• SUP 4: 132.29 Low Nov 30

Bund futures traded lower last week and the contract remains in a bear-mode. The move down strengthens the current bear trend and reinforces the short-term importance of the recent break below the 20-day EMA. Key support at the Dec 8 low of 134.37, has been breached and this opens 133.42, the Dec 4 low. Initial resistance is at 135.34, the 20-day EMA. A clear break of the average is required to ease bearish pressure.

BOBL TECHS: (H4) Bear Cycle Still In Play

• RES 4: 119.640 High Jan 4
• RES 3: 119.00 Round number resistance
• RES 2: 118.590 High Jan 12 and a key short-term resistance
• RES 1: 118.209 20-day EMA
• PRICE: 117.600 @ 05:39 GMT Jan 22
• SUP 1: 117.310 Low Jan 19
• SUP 2: 117.060 Low Dec 1
• SUP 3: 117.000 Round number support
• SUP 4: 116.830 Low Nov 29

A bearish corrective cycle in Bobl futures remains intact and last week’s move lower reinforces a bear theme. The break of support at 117.800, the Dec 8 low, highlights potential for a deeper pullback, exposing 117.060, the Dec 1 low, Note that the 50-day EMA has also been cleared, reinforcing a bearish condition. Key resistance and the bull trigger is 119.830, the Dec 27 high. Initial resistance to watch is 118.590, the Jan 12 high.

SCHATZ TECHS: (H4) Short-Term Trend Needle Points South

• RES 4: 106.640 High Dec 29 and the bull trigger
• RES 3: 106.360 Low Jan 3
• RES 2: 106.270 High Jan 5
• RES 1: 106.117 20-day EMA
• PRICE: 105.865 @ 06:26 GMT Jan 22
• SUP 1: 105.780 Low Dec 1 and Jan 19
• SUP 2: 105.730 Low Nov 30
• SUP 3: 105.660 High Nov 17
• SUP 4: 105.470 Low Nov 28

The downtrend in Schatz futures remains intact and key S/T support at 105.955, the Dec 13 low, has recently been cleared. This strengthens the current bearish theme and signals scope for a continuation lower. Sights are on 105.730 next, the Nov 30 low. On the upside, initial key resistance is at 106.270, the Jan 5 / 12 high. A clear breach of this hurdle would ease bearish pressure and signal a reversal. First resistance is 106.117, the 20-day EMA.

GILT TECHS: (H4) Bear Cycle Remains In Play

• RES 4: 101.98 High Jan 3
• RES 3: 100.81 High Jan 5
• RES 2: 100.0620-day EMA
• RES 1: 99.71 Low Jan 16 and gap high on the daily chart
• PRICE: 98.82 @ Close Jan 22
• SUP 1: 98.00 Low Jan 17
• SUP 2: 97.39 Low Dec 11 and a key support
• SUP 3: 96.67 Low Dec 5
• SUP 4: 96.10 Low Nov 30

Gilt futures last week cleared support at 99.60, the Jan 5 low. This reinforced a bearish theme and confirmed a resumption of the downtrend that started Dec 27. The contract has also traded through support at 97.97, the Dec 6 high signalling scope for an extension towards 97.39, the Dec 11 low. On the upside, firm resistance to watch is at 100.06, the 20-day EMA. A clear break of the average would ease bearish pressure.

BTP TECHS: (H4) Support At The 50-Day EMA Remains Exposed

• RES 4: 122.63 High Dec 7 2022 (cont)
• RES 3: 122.18 3.00 proj of the Nov 10 - 17 - 24 price swing
• RES 2: 121.43 2.764 proj of the Nov 10 - 17 - 24 price swing
• RES 1: 119.23/77 High Jan 12 / 4
• PRICE: 117.69 @ Close Jan 22
• SUP 1: 117.06 Low Jan 18
• SUP 2: 116.54 50-day EMA
• SUP 3: 115.18 Low Dec 4
• SUP 4: 114.10 50.0% retracement of the Oct 19 - Dec 27 bull cycle

BTP futures traded lower last week and a bearish corrective cycle remains in play. Price has recently traded below the 20-day EMA and last week’s move lower delivered a print below support at 117.24, the Jan 5 low. This opens the 50-day EMA at 116.54 - the next key support. Initial firm resistance has been defined at 119.23, the Jan 12 high. A reversal higher and a break of this level would highlight a base.

EQUITIES

EUROSTOXX50 TECHS: (H4) Watching Resistance

• RES 4: 4662.90 1.236 projection of the Nov 8 - 24 - 28 price swing
• RES 3: 4636.70 76.4% retracement of the 2000 - 2009 downleg (cont)
• RES 2: 4599.00/4634.00 High Jan 2 / High Dec 14 and the bull trigger
• RES 1: 4536.00 High Jan 11
• PRICE: 4496 00 @ 07:00 GMT Jan 22
• SUP 1: 4402.00 Low Jan 17 and key short-term support
• SUP 2: 4370.00 Low Nov 28
• SUP 3: 4334.00 50.0% retracement of the Oct 27 - Dec 14 bull leg
• SUP 4: 4220.00 Low Nov 10

Eurostoxx 50 futures last week breached support at the Jan 5 low of 4444.0, trading to a low of 4402.00, the Jan 17 low. The contract has since recovered and 4402.00 represents a key short-term support. A break of this level would resume bearish pressure and open 4370.00, the Nov 28 low. Initial resistance to watch is 4536.00, the Jan 11 high. Clearance of this level would highlight a potential reversal and a resumption of the primary uptrend.

E-MINI S&P TECHS: (H4) Bullish Price Sequence

• RES 4: 4952.45 1.382 proj of Nov 10 - Dec 1 - 7 price swing
• RES 3: 4915.11 1.236 proj of Nov 10 - Dec 1 - 7 price swing
• RES 2: 4900.00 Round number resistance
• RES 1: 4887.50 Intraday high
• PRICE: 4881.00 @ 06:11 GMT Jan 22
• SUP 1: 4785.75/46.25 20-day EMA / Low Jan 17
• SUP 2: 4699.31 50-day EMA
• SUP 3: 4594.00 Low Nov 30
• SUP 4: 4550.75 Low Nov 16

The uptrend in S&P E-Minis remains intact and Friday’s gains confirmed a resumption of the trend. Resistance at 4841.50, the Dec 28 high has been cleared, marking an extension of the price sequence of higher highs and higher lows. Moving average studies remain in a bull-mode condition, reinforcing the current bullish condition. Sights are on 4900.00 next. Key support lies at 4699.31, the 50-day EMA.

COMMODITIES

BRENT TECHS: (H4) Bear Threat Remains Present

• RES 4: $86.50 - High Nov 3
• RES 3: $85.00 - Round number resistance
• RES 2: $84.22 - High Nov 30
• RES 1: $80.75/81.45 - High Jan 12 / High Dec 26 and key resistance
• PRICE: $78.27 @ 07:00 GMT Jan 22
• SUP 1: $74.79 - Low Jan 03
• SUP 2: $72.67/71.21 - Low Dec 13 and the bear trigger / Low Jun 23
• SUP 3: $69.25 - Low Mar 20 and a key support
• SUP 4: $67.84 - 1.236 proj of the Oct 20 - Nov 16 - 30 price swing

The outlook in Brent futures remains bearish. The contract continues to trade below the Jan 12 high high and price remains below key short-term resistance at $81.45, the Dec 26 high. A resumption of bearish activity would open $74.79, the Jan 3 low, ahead of $72.67, the Dec 13 low and bear trigger. For bulls, clearance of $81.45 is required to signal a stronger reversal. This would open $84.22, the Nov 30 high.

WTI TECHS: (H4) Resistance At The 50-Day EMA Remains Intact

• RES 4: $85.71 - High Oct 20
• RES 3: $82.04 - High Nov 3
• RES 2: $79.56 - High Nov 30 and a key short-term resistance
• RES 1: $74.23/76.31 - 50-day EMA / High Dec 26 and the bull trigger
• PRICE: $72.94 @ 07:13 GMT Jan 22
• SUP 1: $69.56 - Low Jan 03
• SUP 2: $68.28 - Low Dec 13 and the bear trigger
• SUP 3: $65.63 - Low Jun 12
• SUP 4: $63.00 - Low May 4 and a key support

Trend signals in WTI futures remain bearish and recent short-term gains are considered corrective. Resistance to watch is $74.23, the 50-day EMA. It has been pierced, a clear break would strengthen a bullish theme and expose $76.31, the Dec 26 high. Moving average studies remain in a bear-mode position and continue to highlight a downtrend. The trigger for a resumption of the downtrend is $68.28, Dec 13 low.

GOLD TECHS: Bear Cycle Remains Intact

• RES 4: $2135.4 - High Dec 4 and all-time high
• RES 3: $2097.1 - 76.4% retracement of the Dec 4 - 13 bear leg
• RES 2: $2062.3/2088.5 - High Jan 12 / High Dec 28
• RES 1: $2039.4 - High Jan 19
• PRICE: $2023.0 @ 07:26 GMT Jan 22
• SUP 1: $2001.9 - Low Jan 17
• SUP 2: $1973.2 - Low Dec 13 and key support
• SUP 3: $1931.7 - Low Nov 13
• SUP 4: $1908.3 - Low Oct 16

Gold remains above the Jan 17 low of $2001.9. Last week’s print below the 50-day EMA and the break of support at $2013.4, the Jan 11 low, has strengthened a bearish threat and a resumption of weakness would open a key level at $1973.2, the Dec 13 low. For bulls, clearance of 2062.3, the Jan 12 high, is required to signal a reversal. This would expose $2088.5, the Dec 28 high.

SILVER TECHS: Clears Support

• RES 4: $26.135 - High May 5 and a key resistance
• RES 3: $25.761 - High Dec 4 and key resistance
• RES 2: $24.606/994 - High Dec 22 / 76.4% of Dec 4 - 13 bear leg
• RES 1: $23.534 - High Jan 12
• PRICE: $22.153 @ 08:16 GMT Jan 22
• SUP 1: $21.883 - Low Nov 13 and a key support
• SUP 2: $20.689 - Low Oct 3 and the bear trigger
• SUP 3: $19.904 - Low Mar 10 and a key support
• SUP 4: $19.904 - Low Mar 10 2023

A bearish theme in Silver remains intact and the metal has traded sharply lower today, resulting in a clear break of support at $22.510, the Dec 13 low. This signals scope for a move to $21.883, Nov 13 low. A break of this support would further strengthen the bearish theme. On the upside, key short-term resistance is at $24.606, the Dec 22 high. A move above this hurdle would reinstate a bullish theme. First resistance is $23.534, the Jan 12 high.