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USDCAD TECHS

Stronger In a Range

AUDUSD TECHS

Weaker In A Range

US TSYS SUMMARY

Ending The Week On A Soft Note

EURJPY TECHS

Bearish Risk Growing

USDJPY TECHS

Stronger, But Still Vulnerable

US

SP500 PE Ratio vs. CPI Inflation


Tech Focus: Price Signal Summary - Silver Gaps Higher

In the FX space, USDJPY has cleared two important resistance levels:
  • The bear channel resistance drawn off the Mar 24 high and 104.40, Nov 11 high.
  • The break highlights a key reversal and also an important shift in sentiment. 105.00 is within reach, the focus is on 105.16 High Nov 13.
  • EURJPY was also bid into the close of the week. The focus is on key resistance at 127.49, Jan 7 high.
  • The key directional triggers in EURUSD are: support at 1.2054, Jan 18 low and 1.2190 resistance, Jan 22 high.
  • EURGBP outlook remains bearish with the focus on 0.8808, May 13 low. Resistance is at 0.8925, Jan 18 high

On the commodity front, Gold remains above near-term support. A deeper sell-off would expose $1804.7, Jan 18 low. Oil contracts remain above support.
Brent (J1) support to watch is $54.40, Jan 22 low and WTI (H1) support lies at $51.44, the low from Jan 22.
Silver gapped higher at the open today. This suggests scope for further gains, and this morning's activity has seen the metal test $30.00 and more importantly register a fresh trend high print of the upleg that started mid-March last year. Stronger gains above $30.00 appear likely.

In the FI space:
  • Bunds (H1) are lower. Support levels to watch are: 177.12, Jan 25 low and 176.63, Jan 22 low.
  • Gilts (H1) are pulling away from recent highs. Firm support is seen at 133.79, Jan 29 low.

In equities, E-mini S&P futures opened sharply lower Monday.

  • Support to watch remains the 3699.29 50-day EMA. Prices have shown below but a close through here would open 3652.50, Jan 4 low and reinforce a developing bearish theme.

FOREIGN EXCHANGE

EURUSD TECHS: Attention Is On Key Support

  • RES 4: 1.2353 High Apr 20, 2018
  • RES 3: 1.2349 High Jan 6
  • RES 2: 1.2230/85 High Jan 11 / 8
  • RES 1: 1.2190 High Jan 22
  • PRICE: 1.2132 @ 05:56 GMT Feb 1
  • SUP 1: 1.2054 Low Jan 18
  • SUP 2: 1.2011 High Sep 1 and a former breakout level
  • SUP 3: 1.1976 50.0% retracement of the Nov 4 - Jan 6 rally
  • SUP 4: 1.1889 2.0% 10-dma envelope

EURUSD continues to consolidate. A softer tone remains in place though with the focus on the Jan 18 low of 1.2054. A break would signal a resumption of the downleg that started off the Jan 6 high. This would pave the way for a move towards 1.2011, Sep 1 high and the psychological 1.2000 handle. A move below 1.2000 would open 1.1976, a Fibonacci retracement. Clearance of 1.2190, Jan 22 high is required to reinstate a bullish theme.

GBPUSD TECHS: Bulls Still In Charge

  • RES 4: 1.3935 High Apr 27, 2018
  • RES 3: 1.3804 High Apr 30, 2018
  • RES 2: 1.3773 High May 1, 2018
  • RES 1: 1.3759 High Jan 27 and the bull trigger
  • PRICE: 1.3745 @ 06:00 GMT Feb 1
  • SUP 1: 1.3610 Low Jan 26
  • SUP 2: 1.3520 Low Jan 18 and key near-term support
  • SUP 3: 1.3514/05 50-day EMA / Low Jan 12
  • SUP 4: 1.3452 Low Jan 11

GBPUSD traded to a fresh high of 1.3759 on Jan 27, reinforcing bullish conditions and the current uptrend the high maintains the bullish price sequence of higher highs and higher lows. Attention is on 1.3773 next, May 1 2018 high. Near-term firm support has been defined at 1.3520, Jan 18 low. A breach would signal scope for a deeper short-term sell-off and expose 1.3452, Jan 11 low. Initial support is at 1.3610, Jan 26.

EURGBP TECHS: Bearish Focus

  • RES 4: 0.9093 High Dec 29
  • RES 3: 0.9085 High Jan 6
  • RES 2: 0.8965/96 50-day EMA / High Jan 12
  • RES 1: 0.8908/25 20-day EMA / High Jan 18 and key resistance
  • PRICE: 0.8826 @ 06:08 GMT Feb 1
  • SUP 1: 0.8813 Low Jan 27
  • SUP 2: 0.8808 Low May 13, 2020
  • SUP 3: 0.8759 Low May 12, 2020
  • SUP 4: 0.8690 2.0% 10-dma envelope

EURGBP remains bearish. The cross traded lower on Jan 27, extending the current downtrend and further weakness is seen likely with the focus on the 0.8800 handle and 0.8759. The latter is the May 12, 2020 low. Moving average studies are also pointing south reinforcing current trend conditions. On the upside, a firm resistance has been defined at 0.8925, the Jan 18 high where a break is required to ease the bearish pressure.

USDJPY TECHS: Uptrend Remains Intact

  • RES 4: 106.05 1.50 proj of the Jan 6 - 11 rally from the Jan 21 low
  • RES 3: 105.68 High Nov 11 and a key resistance
  • RES 2: 105.16 High Nov 13
  • RES 1: 104.94 High Jan 29
  • PRICE: 104.68 @ 06:13 GMT Feb 1
  • SUP 1: 104.40 High Jan 11 and recent breakout level
  • SUP 2: 103.85 Former channel top drawn off the Mar 2020 high
  • SUP 3: 103.33 Low Jan 21
  • SUP 4: 103.28/02 61.8% and 76.4 % of the Jan 6 - 11 rally

USDJPY bullish conditions dominate following last week's price developments. The pair on Jan 27 confirmed a clear break of a bear channel resistance drawn off the Mar 2020 high. Resistance at 104.40 gave way on Jan 28, confirming a resumption of the uptrend that started Jan 6 and this also reinforces the significance of the channel breakout. The focus is on 105.68 next, Nov 11 high. Initial support is at 104.40.

EURJPY TECHS: Approaching The 2021 High

  • RES 4: 128.39 High Dec 20. 2018
  • RES 3: 127.88 0.618 projection of May - Jun rally from Oct 30 low
  • RES 2: 127.49/50 High Jan 7 / High Mar 1, 2019
  • RES 1: 127.34 High Jan 29
  • PRICE: 126.99 @ 06:27 GMT Feb 1
  • SUP 1: 126.23 20-day EMA
  • SUP 2: 125.60 Low Jan 27
  • SUP 3: 125.09 Low Jan 18
  • SUP 4: 124.83 100-DMA

EURJPY traded higher Friday, hitting new multi-week highs at 127.34. This maintains the current bullish theme and extends further the recovery from January 19th. Attention is on resistance at 127.49, Jan 7 high where a break would confirm a resumption of the broader uptrend that has been in place since early May 2020. This would open 127.88 initially, a Fibonacci projection. Initial support is at 126.23, the 20-day EMA.

AUDUSD TECHS: Maintains A Softer Tone

  • RES 4: 0.7917 High Mar 14, 2018 and a key resistance
  • RES 3: 0.7885 High Mar 15. 2018
  • RES 2: 0.7782/7820 High Jan 21 / High Jan 6 and the bull trigger
  • RES 1: 0.7704 High Jan 29
  • PRICE: 0.7660 @ 06:34 GMT Feb 1
  • SUP 1: 0.7592 Low Jan 28 and the 50-day EMA
  • SUP 2: 0.7557 Low Dec 28
  • SUP 3: 0.7517 Low Dec 22
  • SUP 4: 0.7462 Low Dec 21

AUDUSD maintains a bearish tone following last week's move lower. Recent weakness has seen the pair trade below support at 0.7659, Jan 18 low. Scope is seen for a deeper pullback as part of a corrective cycle with momentum studies unwinding a recent overbought reading. Attention is on 0.7592, the 50-day EMA and Jan 28 low, where a break would strengthen a bearish case. On the upside, 0.7782 marks a firm resistance.

USDCAD TECHS: Extension Higher Seen Likely

  • RES 4: 1.2988 2.0% 10-dma envelope
  • RES 3: 1.2957 High Dec 21 and key resistance
  • RES 2: 1.2915 High Dec 23
  • RES 1: 1.2881 High Jan 28
  • PRICE: 1.2764 @ 06:42 GMT Feb 1
  • SUP 1: 1.2738 Low Jan 29
  • SUP 2: 1.2686 Low Jan 27
  • SUP 3: 1.2635 Low Jan 22
  • SUP 4: 1.2590 Low Jan 21 and major support

Despite Friday's fade, USDCAD maintains a bullish stance and appears set to extend the current corrective recovery following a recent rebound off cycle lows at 1.2590. The break of resistance at 1.2799, Jan 18 high and a move through the 50-day EMA signals scope for an extension higher. Prices last week topped resistance at 1.2880, Dec 24 high exposing 1.2957, the Dec 21 high. On the downside, firm near-term support is seen at 1.2686, Jan 27 low.

FIXED INCOME

BUND TECHS: (H1) Holds above Short-Term Trend Support

  • RES 4: 178.37 High Jan 4 and a key resistance
  • RES 3: 178.27 High Jan 5
  • RES 2: 178.12 High Jan 27 and the bull trigger
  • RES 1: 177.66 High Jan 29
  • PRICE: 177.33 @ 05:50 GMT Feb 1
  • SUP 1: 176.89/85 Low Jan 29 / Trendline drawn off the Jan 12 low
  • SUP 2: 176.63 Low Jan 22
  • SUP 3: 176.34 Low Jan 12 and the bear trigger
  • SUP 4: 175.84 Low Nov 11 and a key support

Bund futures traded lower Friday but did find support at the session low of 176.89. A short-term trendline support lies just below at 176.85, drawn off the Jan 12 low. A break of 176.85 is required to strengthen a bearish case. This would signal scope for weakness towards 176.63, Jan 22 low and the more important support at 176.34, Jan 12 low. Key resistance and the bull trigger has been defined at 178.12, Jan 27 high.

BOBL TECHS: (H1) Bullish Focus

  • RES 4: 135.700 High Dec 11 and a key resistance
  • RES 3: 135.610 High Dec 15
  • RES 2: 135.497 76.4% retracement of the Dec 11 - Jan 12 downleg
  • RES 1: 135.480 High Jan 27
  • PRICE: 135.280 @ 05:03 GMT Feb 1
  • SUP 1: 135.160 Low Jan 29 and key intraday support
  • SUP 2: 135.120 Low Jan 25
  • SUP 3: 134.930 Low Jan 22
  • SUP 4: 134.840 Low Jan 12 and a bear trigger

BOBL futures rallied Jan 27 to confirm a clear breach of 135.350, Jan 15 high. The break reinforces a bullish theme and signals scope for a climb to 135.497 next, a Fibonacci retracement. Clearance of 135.497 would strengthen a bullish case for gains towards 135.700, the Dec 11 high. Initial support is seen at Friday's 135.160 low. A break would undermine the positive price structure and expose 134.970, Jan 22 low.

SCHATZ TECHS: (H1) Bullish Theme Following Triple Bottom Reversal

  • RES 4: 112.425 High Dec 14
  • RES 3: 112.399 76.4% retracement of the Dec 11 - 28 downleg
  • RES 2: 112.390 High JDec 16
  • RES 1: 112.368 61.8% retracement of the Dec 11 - 28 downleg
  • PRICE: 112.335 @ 05:09 GMT Feb 1
  • SUP 1: 112.305/290 Low Jan 26 / Low Jan 29
  • SUP 2: 112.270 Low Jan 25
  • SUP 3: 112.240 Low Jan 12, 21 and 22 low
  • SUP 4: 112.235 Low Dec 23 and the bear trigger

Schatz futures traded higher Jan 27 and confirmed a clear break of resistance at 112.330 in the process, the Jan 4, 5 and 15 highs. The break higher has also confirmed a triple bottom reversal pattern highlighting a short-term shift in sentiment. This signals scope for a stronger recovery with the focus on 112.368 next, a Fibonacci retracement and 112.390, the Dec 16 high. Initial support lies at 112.305, Friday's low.

GILT TECHS: (H1) Trades Through Its Short-Term Trendline

  • RES 4: 135.16 High Jan 6
  • RES 3: 135.04 61.8% retracement of the Jan 4 - 12 downleg
  • RES 2: 134.95 High Jan 27/28
  • RES 1: 134.47 High Jan 29
  • PRICE: 134.07 @ Close Jan 29
  • SUP 1: 133.80/79 Low Jan 29 and key intraday support / Low Jan 21
  • SUP 2: 133.55 Low Jan 11 and the bear trigger
  • SUP 3: 133.52 Low Dec 2
  • SUP 4: 133.22 1.382 projection of Dec 11 - 24 sell-off from Jan 4 high

Gilt futures traded sharply lower Friday erasing most of the gains achieved between Jan 21 - 28. A short-term trendline drawn off the Jan 12 low was also breached Friday - the line intersected at 134.00. A break of Friday's low of 133.80 would strengthen a bearish case and open 133.55, Jan 11 low and a key support. On the upside, initial resistance is at 134.47, Jan 29 high. Key resistance has been defined at 134.95, the Jan 27/28 high.

BTP TECHS: (H1) Remains Below Trendline Resistance

  • RES 4: 152.45 High Jan 11
  • RES 3: 152.14 High Jan 20
  • RES 2: 151.61 Trendline resistance drawn off the Jan 8 high
  • RES 1: 151.53 High Jan 28
  • PRICE: 151.00 @ Close Jan 29
  • SUP 1: 150.43 Low Jan 26
  • SUP 2: 149.57 Low Jan 22 and bear trigger
  • SUP 3: 149.09 Low Nov 11 (cont)
  • SUP 4: 148.82 50.0% retracement of the Sep - Jan rally (cont)

BTP futures outlook remains bearish despite a recovery last week from 149.57, Jan 22 low. The contract confirmed a top in the trend on Jan 8 at 152.67. The subsequent move lower also confirmed a bearish price sequence of lower lows and lower highs. The recent move through 150.00 signals scope for weakness towards 149.09, Nov 11 low (cont). Firm resistance is at 151.61, a trendline resistance drawn off the Jan 8 high.

EQUITIES:

EUROSTOXX 50 Techs: Vulnerable

  • RES 4: 3668.70 High Feb 25
  • RES 3: 3657.83 High Jan 8 and the bull trigger
  • RES 2: 3621.49 High Jan 25
  • RES 1: 3580.94 20-day EMA
  • PRICE: 3481.44 @ Close Jan 29
  • SUP 1: 3473.76 Low Jan 28
  • SUP 2: 3455.94 Low Dec 22
  • SUP 3: 3401.14 Low Dec 21 and a key support
  • SUP 4: 3396.02 High Sep 3, 2020

EUROSTOXX 50 remains vulnerable following last week's sell-off and extension of the pullback from 3657.83, Jan 8 high. The move lower on Jan 27 saw the index trade through 3524.63, Jan 5 low and the 50-day EMA. This reinforces a bearish case and opens 3455.94, the Dec 22 low. On the upside, key resistance and the bull trigger remains 3657.83. A break would resume the underlying uptrend.

COMMODITIES:

BRENT TECHS: (J1) Key Support Remains Intact

  • RES 4: $59.71 - 1.382 proj of the Apr - Aug - Nov 2020 price swing
  • RES 3: $58.59 - 76.4% of the Jan - Apr 2020 sell-off (cont)
  • RES 2: $57.31 - High Jan 13 and the bull trigger
  • RES 1: $56.50 - High Jan 20
  • PRICE: $55.41 @ 06:42 GMT Feb 1
  • SUP 1: $54.40 - Low Jan 22
  • SUP 2: $52.90 - Low Jan 6
  • SUP 3: $52.01 - 50-day EMA
  • SUP 4: $50.66 - Low Jan 4

Brent futures are still consolidating and remain below this year's high. Key ST support has been defined at $54.40, Jan 22 low. A breach of this level would pave the way for a deeper corrective decline and allow an overbought trend reading to unwind. Note a break of $54.40 would also see price trade through the 20-day EMA. On the upside, key resistance is at $57.31, Jan 13 high. Clearance of this resistance would confirm a resumption of the uptrend.

WTI TECHS: (H1) Bullish While Support Holds

  • RES 4: $56.52 - 1.236 proj of Apr - Aug rally from the Nov 2 low
  • RES 3: $55.00 - Round number resistance
  • RES 2: $54.50 - High Feb 20, 2020 and a key resistance (cont)
  • RES 1: $53.94 - High Jan 13 and the bull trigger
  • PRICE: $52.49 @ 06:46 GMT Feb 1
  • SUP 1: $51.44 Low Jan 22
  • SUP 2: $50.86 - Low Jan 8
  • SUP 3: $49.52 - High Dec 18 and a former breakout level
  • SUP 4: $48.85 - 50-day EMA

WTI futures maintain a consolidative tone but the outlook remains bullish. A positive price sequence of higher highs and higher lows remains intact. Price action however is trading below recent highs and attention is on support at $51.44, Jan 22 low. A clear break of this level would signal scope for a deeper corrective pullback. On the upside, a climb above $53.94, Jan 13 high would resume the uptrend.

GOLD TECHS: Holding Above Support

  • RES 4: $1900.3 - 61.8% retracement of the Jan 6 - 11 rally
  • RES 3: $1882.0 - 50.0% retracement of the Jan 6 - 11 rally
  • RES 2: $1875.2 - High Jan 21 and key resistance
  • RES 1: $1867.3 - Intraday high
  • PRICE: $1862.4 @ 07:14 GMT Feb 1
  • SUP 1: $1831.5 - Low Jan 27 and a bear trigger
  • SUP 2: $1804.7 - Low Jan 18 and key support
  • SUP 3: $1800.0 - Round number support
  • SUP 4: $1775.9 - Low Dec 1

Gold is firmer today but remains below Friday's high of $1875.7. Last week's pullback has resulted in a test of support at $1832.6, Jan 20 low. A clear break of this level would strengthen a bearish case and undermine recent bullish price development. Furthermore, this would suggest scope for a move towards the key support at $1804.7, Jan 18 low. On the upside, clearance of $1875.7 would instead be bullish and open $1882.0 initially.

SILVER TECHS: Tests The Psychological $30.00 Handle

  • RES 4: $32.394 - 1.382 proj of Nov 30 - Jan 6 rally from Jan 18 low
  • RES 3: $31.513 - 1.236 proj of Nov 30 - Jan 6 rally from Jan 18 low
  • RES 2: $30.723 - 50.0% retracement of the 2011 - 2020 downtrend
  • RES 1: $30.100 - Intraday high
  • PRICE: $29.889 @ 09:26 GMT Feb 1
  • SUP 1: $27.931 - High Jan 6
  • SUP 2: $27.654 - High Jan 29 and a gap low on the daily chart
  • SUP 3: $25.788 - 20-day EMA
  • SUP 4: $24.700 - Low Jan 27

Silver is sharply higher with the metal trading above the $27.931, Jan 6 high. Price gapped higher at the open today. This suggests scope for further gains, and this morning's activity has seen the metal test $30.00 and more importantly register a fresh trend high print of the upleg that started mid-March last year. Stronger gains above $30.00 appear likely. On the downside, initial firm support lies at $27.931, Friday's high.

MNI London Bureau | +44 203-586-3805 | taso.anastasiou.ext@marketnews.com