MNI DAILY TECHNICAL ANALYSIS - Rebound in FI Futures Extends

Price Signal Summary - Corrective Cycle In The FI Space     

• In the equity space, a bear threat in the S&P E-Minis contract remains present. However, Wednesday’s gains resulted in a print above resistance at 5987.04, the 50-day EMA. A clear break of it would signal a possible reversal. This would open 6107.50, the Dec 26 high. Key short-term support has been defined at 5809.00, the Jan 13 low. A breach of this level would confirm a resumption of the downtrend. A bull cycle in the EUROSTOXX 50 futures contract remains intact. This week’s climb resulted in a breach of 5054.00, the Jan 8 high, to confirm a resumption of the uptrend. The contract is again trading higher, today. The focus is on a climb towards 5200.00, a round number resistance point. Key short-term support has been defined at 4931.00, the Jan 13 low. A break of this level would be bearish. First support lies at 5113.00, the Jan 17 low.               
• In FX, the trend condition in EURUSD is unchanged, it remains bearish and this week’s recovery appears corrective. Recent weakness resulted in a print below 1.0226, the Jan 2 low. The breach confirms a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. Sights are on 1.0138 next, a 1.764 projection of the Sep 25 - Oct 23 - Nov 5 price swing. Resistance to watch is 1.0437, the Jan 6 high. Initial resistance is at 1.0345, the 20-day EMA. The trend condition in GBPUSD remains down and short-term gains are considered corrective. Recent weakness has confirmed a resumption of the downtrend. Note too that moving average studies are in a bear-mode position, highlighting a dominant bear trend. Sights are on 1.2087 next, a 0.764 projection of the Sep 26 - Nov 22 - Dec 6 price swing. Initial firm resistance is at 1.2398, the 20-day EMA. The trend condition in USDJPY  is unchanged, it remains bullish and this week’s move lower appears corrective - for now. Support to watch is 154.90, the 50-day EMA. A return higher and a breach of 158.87, the Jan 10 high, would confirm a resumption of the uptrend and open 159.45, the Jul 12 ‘24 high.  
• On the commodity front, recent gains in Gold appear corrective - for now. However, the yellow metal continues to hold on to its latest gains and scope is seen for a continuation higher near-term. The stronger recovery exposes $2726.2, the Dec 12 high and an important resistance. Clearance of this level would be a bullish development. On the downside, a reversal lower would expose $2583.6, the Dec 19 low. Initial support is at $2649.0, the 50-day EMA. In the oil space, the trend structure in WTI futures remains bullish and Wednesday's rally reinforces current conditions. The recent strong impulsive climb has resulted in a breach of $76.41, the Oct 8 high. Note too that $80.14, the Apr 12 ‘24 high has been pierced, strengthening the bullish theme. Sights are on $81.69, a 3.236 projection of the Nov 18 - 22 - Dec 6 price swing. On the downside, a reversal lower would expose the 20-day EMA, at $73.81, a key short-term support.         
• In the FI space, the trend in Bund futures is unchanged, it remains bearish. However, Wednesday’s gains highlight a possible short-term reversal signal - a bullish engulfing candle. If correct, it suggests scope for a corrective bull cycle that would allow an oversold trend condition to unwind. A continuation higher would open 132.55, the 20-day EMA. The bear trigger has been defined at 130.28, the Jan 15 low, a break would resume the downtrend. The trend condition in Gilt futures is unchanged, the direction remains down. However, strong gains this week highlight the start of a corrective phase and if correct, signals scope for a continuation higher near-term. Attention is resistance at the 20-day EMA, at 91.54. This average has been breached, a clear break would suggest scope for a stronger retracement, towards 92.27 next, the Jan 6 high. On the downside, the bear trigger has been defined at 88.96, the Jan 13 low. First support lies at 90.68, the Jan 16 low.

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