MNI DAILY TECHNICAL ANALYSIS - S&P Breaches Key Support

Price Signal Summary - S&P E-minis Breach 50-dma Support

• In the equity space, the pullback is extending in S&P E-minis, with the index showing below the 50-dma support. A close below would be the first since early March and markets watch key support at 3994.14. A break below here opens a decline toward 3843.25, which would be well on the way to a technical correction.
• In FX, EURUSD has edged lower, but remains above 1.1986, May 5 low, but bulls are consistently finding trouble in solidly breaking above 1.2150, Apr 29 high. The focus is on 1.2184, Feb 26 high and 1.2243, Feb 25 high. GBPUSD is firm following Monday's strong rally and attention is on 1.4237, Feb 24 high and this year's high. USDJPY support has been defined at 108.34, May 7 low A bullish theme remains intact while it holds and attention is on 109.70, May 3 high. A break of support would highlight a trendline break drawn off the Jan 6 low and risk a deeper pullback.
• On the commodity front, Gold is holding onto gains and the outlook remains bullish. Last week's climb has opened $1851.5, 61.8% retracement of the Jan 6 - Mar 8 sell-off. Oil is off recent highs but the uptrend remains intact. The Brent (N1) focus is on the psychological $70.00 level and $71.75, Jan 8 2020 high (cont). Watch key support at $66.10, May 3 low. WTI bulls are eyeing the key resistance at $67.29, Mar 8 high. Support at $62.91, May 3 low is key.
• In the FI space, Bunds (M1) remain vulnerable and through 169.24, Feb 25 low, hitting the bear trigger in the process. This highlights a real risk of a revisit of the 2020 lows at 167.52. Near-term risk in Gilts is still skewed to the downside. The next support and intraday bear trigger is at 127.32, Apr 1 low.

FOREIGN EXCHANGE

EURUSD TECHS: Taking on Weight

• RES 4: 1.2285 High Jan 8
• RES 3: 1.2243 High Feb 25 and a key resistance
• RES 2: 1.2207 1.0% 10-dma envelope
• RES 1: 1.2182/84 High May 11 / High Feb 26
• PRICE: 1.2082 @ 16:05 BST May 12
• SUP 1: 1.2066 Low May 12
• SUP 2: 1.2052 20-day EMA
• SUP 3: 1.1986 Low May 5 and key short-term support
• SUP 4: 1.1943 Low Apr 19

EURUSD took on weight after considerably higher-than-expected US CPI, which opens a sizeable gap with Tuesday's 1.2182 high. This works against the bullish outlook, particularly as former resistance-turned-support at trendline resistance drawn off the Jan 6 high has given way. MA conditions support a bullish theme, but markets need to take 1.2184, Feb 26 high to cement.

GBPUSD TECHS: Key Resistance Exposed

• RES 4: 1.4315 High Apr 18, 218
• RES 3: 1.4237 High Feb 24 and a key resistance
• RES 2: 1.4233 2.0% 10-dma envelope
• RES 1: 1.4166 High May 11
• PRICE: 1.4104 @ 16:18 BST May 12
• SUP 1: 1.3972 Low May 10
• SUP 2: 1.3858 Low May 6
• SUP 3: 1.3801 Low May 3 and a key support
• SUP 4: 1.3752 Bull channel base drawn off the May 2020 low

GBPUSD outlook remains bullish despite the post-CPI weight in the pair. The rate has cleared a number of resistance levels reinforcing a positive theme with sights set on the key resistance at 1.4237, Feb 24 high. A break of 1.4237 would strengthen a bullish case and importantly confirm a resumption of the broader uptrend that started in March 2020. On the downside, initial support is at Monday's intraday low of 1.3972.

EURGBP TECHS: At Risk of Bearish Breakout

• RES 4: 0.8791/8835 High Feb 12 / 2.0% 10-dma envelope
• RES 3: 0.8731 High Feb 26
• RES 2: 0.8701/21 High May 7 / High Apr 26 and the bull Trigger
• RES 1: 0.8660 50-day EMA
• PRICE: 0.8563 @ 16:21 BST May 12
• SUP 1: 0.8561 Low May 12
• SUP 2: 0.8475 2.0% 10-dma envelope
• SUP 3: 0.8472 Low Apr 5 and the bear trigger
• SUP 4: 0.8430 Low Feb 27, 2020

EURGBP extended losses Wednesday, taking out key support at 0.8589, Apr 19 low, which sees the cross move out of its recent range and confirm a bearish breakout. This suggests scope for a deeper pullback, potentially towards the key support at 0.8472, Apr 5 low. On the upside, the key resistance and bull trigger is unchanged at 0.8721, Apr 26 high. Initial resistance is at 0.8660.

USDJPY TECHS: Fierce Bounce, But Needs to Stick

• RES 4: 110.97 High Mar 31 and the bull trigger
• RES 3: 110.55 High Apr 6
• RES 2: 109.70/96 High May 3 / High Apr 9
• RES 1: 109.51 High May 12
• PRICE: 109.48 @ 16:27 BST May 12
• SUP 1: 108.34/08 Low May 7 / Low Apr 27
• SUP 2: 107.48 Low Apr 23 and the bear trigger
• SUP 3: 106.97 Low Mar 4
• SUP 4: 106.78 50.0% retracement of the Jan - Mar rally

USDJPY rallied sharply on the back of higher-than-expected US CPI, pushing prices through near-term resistance to open the early May / early April highs of 109.70/96. This counters any downside signals evident in last week's trade through the trendline support at 108.44 (drawn off the Jan 6 low). A break of 109.70, May 3 high, would strengthen a bullish case and signal scope for a climb above 110.00.

EURJPY TECHS: Needle Still Points North

• RES 4: 133.68 Bull channel top drawn off the Oct 30, 2020 low
• RES 3: 133.28 1.50 proj of Jun-Sep-Oct 2020 swing
• RES 2: 133.13 High Sep 21, 2018 and a key resistance
• RES 1: 132.36/53 1.382 of Jun-Sep-Oct 2020 swing / High May 10
• PRICE: 132.22 @ 16:40 BST May 12
• SUP 1: 131.48 Low May 7
• SUP 2: 130.99 Low May 5 and a key support
• SUP 3: 130.57 Low Apr 27
• SUP 4: 130.17 Bull channel base drawn off the Oct 30, 2020 low

EURJPY is consolidating with the outlook remaining bullish. Price traded above 132.36 Monday, a Fibonacci projection. A clear break would reinforce bullish conditions and signal scope for further gains within the bull channel drawn off the Oct 30 2020 low. Moving average studies are still pointing north, reinforcing current conditions. Support is at 130.99, May 5 low. The focus is on 133.28 next, a Fibonacci projection.

AUDUSD TECHS: New Weekly Lows

• RES 4: 0.8044 High Feb 2, 2018
• RES 3: 0.8007 High Feb 25 and the bull trigger
• RES 2: 0.7934 2.0% 10-dma envelope
• RES 1: 0.7895 76.4% retracement of the Feb 25 - Apr 1 sell-off
• PRICE: 0.7738 @ 16:41 BST May 12
• SUP 1: 0.7734 Low May 12
• SUP 2: 0.7675 Low May 4 and key support
• SUP 3: 0.7635 Low Apr 14
• SUP 4: 0.7586 Low Apr 13

AUDUSD traded higher Monday but stalled at the session high and has since pulled back. The pair hit new weekly lows post-US CPI. A bullish outlook remains intact though. The pair has recently cleared the April highs and this opens the 76.4% retracement of the February - April downtick at 0.7895. A break here would strengthen bullish conditions and point the needle toward the year's best levels printed in late February at 0.8007.

USDCAD TECHS: Tests Major Support - The 2017 Low!

• RES 4: 1.2455 50-day EMA
• RES 3: 1.2419 High Apr 27
• RES 2: 1.2351 High May 4 and a key near-term resistance
• RES 1: 1.2194/2288 High May 7 / High May 6
• PRICE: 1.2105 @ 16:44 BST May 12
• SUP 1: 1.2046 Low May 12
• SUP 2: 1.2000 Psychological round number
• SUP 3: 1.1978 2.0% 10-dma envelope
• SUP 4: 1.1920 Low May 2015

USDCAD has traded lower again Wednesday as the bear cycle extends. This week's key technical development has been a test of the major support at 1.2062, Sep 2017 low. This represents an important pivot chart point that either represents the base of a broad range or the midpoint of a double top reversal pattern. A clear break lower would reinforce the current downtrend and open 1.2000 and below. Initial firm resistance is at 1.2194, May 7 high.

FIXED INCOME

BUND TECHS: (M1) Takes Out Key Support

• RES 4: 172.12 High Apr 8
• RES 3: 171.62 High Apr 14
• RES 2: 171.19/27 50-day EMA / High Apr 22
• RES 1: 170.55/98 20-day EMA / High Apr 7
• PRICE: 168.93 @ 16:51 BST May 12
• SUP 1: 168.91 Low May 12
• SUP 2: 168.52 Low Mar 20, 2020 (cont)
• SUP 3: 168.39 1.0% 10-dma envelope
• SUP 4: 168.09 0.764 proj of the Jan 27 - Feb 25 - Mar 25 price swing

Bund futures fell further post-US CPI data, hitting new 2021 lows and further cementing the resumption of bearish activity. This week's sell-off resulted in a breach of support at 169.47, May 3 low as well as 169.24, Feb 24 low, opening further losses below 169.00. Vol band support undercuts at 168.39 going forward, but the outlook is bleak. A key short-term resistance has been defined at 170.98, Apr 7 high.

BOBL TECHS: (M1) Bearish Breakout Cemented

• RES 4: 135.180 High Apr 14
• RES 3: 135.050 High Apr 22
• RES 2: 135.040 High May 6
• RES 1: 134.881 20-day EMA
• PRICE: 134.400 @ 16:56 BST May 12
• SUP 1: 134.390 Low May 12
• SUP 2: 134.140 Low Feb 26 and key support
• SUP 3: 134.000 Round number support
• SUP 4: 133.340 Low Mar 19, 2020 (cont)

Bobl futures extended recent weakness to hit new cycle lows of 134.390 Wednesday This further confirms a resumption of the bearish cycle that started Mar 25. The break lower and resumption of weakness signals scope for a move towards end-Feb lows next, with support layered between 134.00-134.14. Clearance of this level would open markets to further losses toward the 2020 lows. Key resistance is at 135.040, May 6 high.

SCHATZ TECHS: (M1) Clears Congestion Support

• RES 4: 112.165 High Mar 25 and the bull trigger
• RES 3: 112.150 High Apr 8
• RES 2: 112.110/120 High May 4, 5, and 6 / High Apr 22
• RES 1: 112.090 20-day EMA
• PRICE: 112.020 @ 17:00 BST May 12
• SUP 1: 112.015 Low May 12
• SUP 2: 112.026 61.8% retracement of the Feb 26 - Mar 25 rally
• SUP 3: 111.993 76.4% retracement of the Feb 26 - Mar 25 rally
• SUP 4: 111.940 Low Feb 26 ad key support

Schatz futures stalled last week at 112.110 and resistance at 112.120, Apr 22 high remains intact. The subsequent pullback has resulted in a break of 112.060, a level that provided support in March and April. The clear break strengthens a bearish case and paves the way for weakness below 112.00. On the upside, a breach of 112.110 is required to signal a reversal. Bearish!

GILT TECHS: (M1) Key Support Zone Exposed

• RES 4: 130.38 High Feb 17 / 18
• RES 3: 129.75 High Feb 19
• RES 2: 129.09/27 High Apr 23 and the reversal trigger / High Mar 2
• RES 1: 128.80 High May 7
• PRICE: 127.23 @ Close May 12
• SUP 1: 127.15 Low May 12
• SUP 2: 126.79 Low Mar 18 and the bear trigger
• SUP 3: 126.64 1.0% 10-dma Envelope
• SUP 4: 126.55 Low Apr 17, 2019 (cont)

The Gilt futures outlook remains bearish. The pullback from 128.80, last week's high on May 7, has extended, with markets taking out a firm area of support between 127.40 and 127.32, the Apr 29 and Apr 1 lows respectively. This strengthens the bearish case and exposes the major support at 126.79, Mar 18 low and the bear trigger. A break of 126.79 would confirm a resumption of the broader downtrend. Initial firm resistance is 128.80.

BTP TECHS: (M1) Downtrend Extends Further

• RES 4: 148.85 High Apr 15
• RES 3: 148.65 High Apr 22
• RES 2: 147.79 High May 4 and key near-term resistance
• RES 1: 147.33 High May 7
• PRICE: 145.87 @ Close May 12
• SUP 1: 145.83 Low May 12
• SUP 2: 145.35 1.00 proj of the Feb 12 - 26 - Mar 11 price swing
• SUP 3: 144.96 Low Sep 9, 2020 (cont)
• SUP 4: 144.16 1.236 proj of the Feb 12 - 26 - Mar 11 price swing

BTP futures remain weak and traded lower again Wednesday. A bearish theme follows last week's move lower and break of support at 146.84, Feb 26 low. This confirms a resumption of the downtrend that has been in place since Feb 12, with the theme strengthening on the move below 146.00. Moving average studies are in a bear mode reinforcing the current bear cycle. On the upside, key short-term resistance is at 147.79, May 4 high.

EQUITIES

EUROSTOXX 50 TECHS: (M1) Recovering Ahead of Key Support

• RES 4: 4175.00 Low Nov 26, 2007 (cont)
• RES 3: 4140.00 High Jan 18, 2008 (cont)
• RES 2: 4099.00 1.00 proj of of the Mar - Jul - Oct 2020 price swing
• RES 1: 4036.00 High May 10 and the bull trigger
• PRICE: 3919.00 @ 17:14 BST May 12
• SUP 1: 3882.00 Low May 4 and key support
• SUP 2: 3858.41 50-day EMA
• SUP 3: 3821.00 High Mar 18 and recent breakout level
• SUP 4: 3727.00 Low Mar 25

EUROSTOXX 50 futures started the week on a softer note. The contract remains under pressure however, broader trend conditions still highlight a bullish theme and pullbacks are likely corrective. The recent break of 4000 confirmed a resumption of the underlying uptrend opening 4099.00, a Fibonacci projection. Key support to watch is 3882.00, May 4 low. A break would be bearish and signal a top and the start of a deeper correction.

E-MINI S&P (M1): Pullback Extends

• RES 4: 4264.32 2.0% 10-dma envelope
• RES 3: 4239.26 1.764 proj of the Feb 1 - Feb 16 - Mar 4 price swing
• RES 2: 4238.25 High May 10 and the bull trigger
• RES 1: 4185.50 High May 12
• PRICE: 4044.00 @ 08:47 BST May 13
• SUP 1: 4042.75 Low May 13
• SUP 2: 4028.42 3.0% 10-dma Envelope
• SUP 3: 4021.00 Low Apr 5
• SUP 4: 3932.86 100-dma

The pullback in the S&P E-mini is extending early Thursday, taking out nearby support and edging below the 50-dma at 4052.82. A close below would be the first since early March. Today's weakness has extended the pullback from the alltime high to near 5%, so the index is far from entering correction territory just yet. The longevity of the recent sell-off will depend on the ability for the index to hold above key support at 3994.14. A break below here opens a decline toward 3843.25, which would be well on the way to a technical correction.

COMMODITIES

BRENT TECHS: (N1) Price Structure Remains Bullish

• RES 4: $71.95 - High Sep 16, 2019 (cont)
• RES 3: $71.75 - High Jan 8 2020 (cont)
• RES 2: $70.00 - Psychological round number
• RES 1: $69.95 - High May 5
• PRICE: $69.22 @ 19:42 BST May 12
• SUP 1: $67.13 - Low May 11
• SUP 2: $66.10 - Low May 3
• SUP 3: $64.75 - 50-day EMA
• SUP 4: $63.93 - Low Apr 26

The Brent crude price structure remains bullish. Price on May 5, probed key resistance at $69.73, Mar 8 high. A clear break of this level would confirm a resumption of the broader uptrend and extend the bullish price sequence of higher highs and higher lows. This would open $71.75, the Jan 8, 2020 high (cont). On the downside, initial firm support has been defined at $66.10. A break would be bearish.

WTI TECHS: (M1) Needle Still Points North

• RES 4: $70.00 - Psychological round number
• RES 3: $67.95 - High Oct 29, 2018
• RES 2: $67.29 - High Mar 8 and the bull trigger
• RES 1: $66.76 - High May 5
• PRICE: $65.02 @ 08:41 BST May 13
• SUP 1: $63.68 - Low May 11
• SUP 2: $62.91 - Low May 3 and key near-term support
• SUP 3: $60.61 - Low Apr 22 and key short-term support
• SUP 4: $58.77 - Low Apr 12

WTI futures maintain a bullish tone following last week's gains. The contract has probed resistance at $66.15, Mar 15 high where a clear break would pave the way for a test of the key hurdle for bulls at $67.29, Mar 8 high. Clearance of this resistance would confirm a resumption of the broader uptrend. On the downside, firm near-term support has been defined at $62.91, May 3 low. A break would be bearish.

GOLD TECHS: Bullish Price Sequence

• RES 4: $1875.7 - High Jan 29
• RES 3: $1855.5 - High Feb 10
• RES 2: $1851.5 - 61.8% retracement of the Jan 6 - Mar 8 sell-off
• RES 1: $1845.5 - High May 10
• PRICE: $1818.1 @ 08:42 BST May 13
• SUP 1: $1799.1 - High May 4 and a recent breakout level
• SUP 2: $1790.2 - 20-day EMA
• SUP 3: $1764.3 - Low Apr 30
• SUP 4: $1756.2 - Low Apr 29 and key near-term support

Gold is holding onto recent gains. The yellow metal recently cleared resistance at $1797.9, Apr 22 high. This confirmed a resumption of the uptrend that started early March where a reversal pattern in the shape of a double bottom began. This pattern was confirmed on Apr 8. The move higher paves has also confirmed a bullish price sequence of higher highs and higher lows and the focus is on $1851.5 next, a retracement. Support is at $1799.1.

SILVER TECHS: Bulls Still In Charge

• RES 4: $28.609 - 76.4% retracement of the Feb 1 - Mar 31 sell-off
• RES 3: $28.328 - High Feb 23 and a key resistance
• RES 2: $28.205 - High Feb 25
• RES 1: $27.883 - High May 10
• PRICE: $26.986 @ 08:43 BST May 13
• SUP 1: $26.506 - 20-day EMA
• SUP 2: $25.718 - Low Apr 29 and key near-term support
• SUP 3: $25.636 - Low Apr 19
• SUP 4: $25.199 - Low Apr 14

Silver remains bullish. The metal rallied last week, extending the current bull cycle that started Mar 3. The push higher strengthens a bullish case and confirms a resumption of the recovery from Mar 31. With moving average signals in a bull mode too, further gains are likely towards $28.328, Feb 23 high. This level represents the next key resistance handle. On the downside, key short-term support has been defined at $25.718, Apr 29 low.