MNI DAILY TECHNICAL ANALYSIS - Potentials S&P 500 Reversal

MNI (LONDON) - Price Signal Summary - Potential Reversal In S&P E-Minis     

• In the equity space, a volatile and bullish session in S&P E-Minis yesterday, highlights a possible reversal and the end of the corrective cycle between Sep 3 - 6. A continuation higher would signal scope for a climb towards 5669.75, the Sep 3 high. On the downside, a reversal lower and a breach of 5394.0.00, the Sep 6 low, would reinstate a bearish theme. First support lies at 5515.90, the 50-day EMA. Despite a short-term bounce, EUROSTOXX 50 futures continue to trade closer to their recent lows. The latest move down has resulted in a break of both the 20- and 50-day EMAs. A resumption of the bear leg would signal scope for weakness towards 4686.53, 61.8% of the Aug 5 - Sep 3 bull cycle. First resistance to watch is at 4867.99, the 50-day EMA.                                                                                                      
• In FX, EURUSD maintains a softer tone. The move lower this week, has resulted in a breach of the 20-day EMA and a move through support at 1.1026, the Sep 3 low. A clear break of this level would signal scope for a deeper correction towards the 50-day EMA, at 1.0980. Clearance of the 50-day EMA would undermine the bullish theme. Key short-term resistance has been defined at 1.1155, the Sep 6 high. A break of this hurdle would be bullish development. GBPUSD has traded lower this week, extending the bear cycle that started Aug 27. The move down is considered corrective and this is allowing a recent overbought condition to unwind. Support at the 20-day EMA, at 1.3072, has been breached. The break signals scope for a deeper retracement, potentially towards the 50-day EMA, at 1.2964. For bulls, a reversal higher would refocus attention on key short-term resistance at 1.3266, Aug 27 high. USDJPY bears remain in the driver’s seat and the pair traded to a fresh cycle low Wednesday, before recovering. S/T gains are - for now - considered corrective. The move down has resulted in a break of key support and the bear trigger at 141.70, the Aug 5 low. This confirms a resumption of the downtrend and sights are on 140.25, the Dec 28 ‘23 low. Resistance is at 145.24, 20-day EMA.        
• On the commodity front, Gold continues to trade inside a range but remains closer to its recent highs. The trend condition is unchanged and the primary direction remains up. Sights are on $2536.4 next, a 1.50 projection of the Jul 25 - Aug 2 - Aug 5 price swing. The 20-day EMA has recently been pierced. The next firm support to watch is $2453.4, the 50-day EMA. In the oil space, WTI futures remain in a bearish condition, despite the latest bounce. Tuesday’s strong sell-off reinforces current conditions and confirmed an extension of the bear cycle. A continuation lower would open $63.93 next, 1.618 projection of the Apr 12 - Jun 4 - Jul 5 price swing, ahead of the psychological $60.00 handle. Short-term gains are considered corrective. Firm resistance is at $71.56, the 20-day EMA.                                                                                                                                                                                                 
• In the FI space, Bund futures traded higher yesterday and this confirmed a resumption of the bull cycle that started Sep 2. The contract has breached 134.95, 76.4% of the Aug 5 - Sep 2 bear leg, exposing the key resistance and bull trigger at 135.66, the Aug 5 high. Initial firm support lies at 134.01, the 20-day EMA. Gilt futures traded higher again Wednesday and the contract remains firm with the bull cycle still in play. The latest round of gains have resulted in a break of 100.30, the Aug 14 high. This resumes the uptrend. 101.78 marks the next objective, a 1.00 projection of the Sep 2 - 6 - 9 price swing. On the downside, firm short-term support has been defined 99.29, the Sep 9 low.

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