MNI DAILY TECHNICAL ANALYSIS - Stock Gains Still Considered Corrective

Price Signal Summary – Stock Gains Still Considered Corrective

• S&P E-Minis remain firm following last week’s gains. The contract has traded above the 50-day EMA - the average intersects at 4190.56. A clear break of this average would strengthen current bullish conditions and signal potential for a climb towards a key resistance at 4303.50, the Apr 26/28 high. EUROSTOXX 50 futures maintain a firmer short-term tone following recent gains and the break above the 50-day EMA. Gains are still considered corrective, however, attention is on resistance at 3883.00, Apr 21 high and, the key resistance at 3944.00, the Mar 29 high.
• EURUSD is holding on to the bulk of its recent gains and trading near the top of its bear channel. The channel is drawn from the Feb 10 high and intersects at 1.0804. It marks a key short-term resistance where a break would strengthen bullish conditions and highlight a stronger short-term reversal. USDJPY has managed to recover from its recent lows and support at the 50-day EMA remains intact - the average intersects at 126.10. Recent weakness below support at 126.95, Apr 27 low, was bearish. AUDUSD extended recent strength into the Monday close and this reinforces the current bull theme. The resumption of gains put prices north of the 50-day EMA, at 0.7170 and has exposed resistance at 0.7266, the May 4/5 and a bull trigger.
• Gold maintains a firmer short-term tone and is trading closer to its recent highs. The yellow metal to test resistance at $1857.6, the 20-day EMA. WTI futures have started the week on a firm note and are trading higher this morning. The contract has breached resistance at $116.43, the Mar 7 high and the former contract high.
• Bund futures traded lower Monday, but the contract maintains a broadly sideways direction. The primary trend direction is down though. Gilt futures traded below initial support Monday. The primary trend direction remains down and the pullback from recent highs is a bearish development that suggests the correction between May 9 - 12 is over.

FOREIGN EXCHANGE

EURUSD TECHS: Approaching The Bear Channel Top

• RES 4: 1.0936 High Apr 21
• RES 3: 1.0807 Bear channel resistance drawn from the Feb 10 high
• RES 2: 1.0800 Round number resistance
• RES 1: 1.0787 High May 30
• PRICE: 1.0750 @ 06:13 BST May 31
• SUP 1: 1.0643/0533 Low May 25 / Low May 20
• SUP 2: 1.0461 Low May 18 and19
• SUP 3: 1.0350 Low May 13 and bear trigger
• SUP 4: 1.0341 Low Jan 3 2017 and a key support

EURUSD is holding on to the bulk of its recent gains and trading near the top of its bear channel. The channel is drawn from the Feb 10 high and intersects at 1.0804. It marks a key short-term resistance where a break would strengthen bullish conditions and highlight a stronger short-term reversal. The primary trend remains down though and a reversal lower would reinforce a bearish theme. This would open 1.0533 initially, the May 20 low.

EURGBP TECHS: Remains Above Support

• RES 4: 0.8658 High Sep 29 2021
• RES 3: 0.8643 High Sep 30 2021
• RES 2: 0.8619 High May 12 and bull trigger
• RES 1: 0.8587 High May 24
• PRICE: 0.8523 @ 06:37 BST May 31
• SUP 1: 0.8485/8433 20-day EMA / Low May 23
• SUP 2: 0.8393/ 0.8391 Low May 17 / 61.8% of Apr 14 - May 12 upleg
• SUP 3: 0.8367 Low May 2
• SUP 4: 0.8337 76.4% retracement of the Apr 14 - May 12 upleg

EURGBP maintains a positive theme and is holding above initial support. The break higher on May 24 reinstated a short-term bullish theme and has exposed 0.8619, May 12 high and the next hurdle for bulls. Clearance of this level would resume a 3.5 month uptrend. Initial support lies at 0.8485, the 20-day EMA ahead of a firmer short-term level at 0.8433, the May 23 low. Key short-term support lies at 0.8393, the May 17 low and is a bear trigger.

USDJPY TECHS: Holding Above Its Recent Lows

• RES 4: 132.39 High Apr 15 2002
• RES 3: 131.96 1.00 proj of the Feb 24 - Mar 28 - 31 price swing
• RES 2: 129.78/131.35 High May 17 / High May 9 and the bull trigger
• RES 1: 128.34 Intraday high
• PRICE: 127.85 @ 06:46 BST May 31
• SUP 1: 126.36 Low May 24
• SUP 2: 126.10 50-day EMA
• SUP 3: 125.09 Low Apr 14
• SUP 4: 124.01 Low Apr 11

USDJPY has managed to recover from its recent lows and support at the 50-day EMA remains intact - the average intersects at 126.10. Recent weakness below support at 126.95, Apr 27 low, was bearish. However, this has not resulted in an extension lower to reinforce a bearish threat. A break of the 50-day EMA would strengthen bearish conditions. For bulls, a recovery would open 129.78 next, May 17 high.

EURJPY TECHS: Approaching Key Resistance Zone

• RES 4: 141.06 High Jun 4 2015 and a key resistance
• RES 3: 140.87 0.50 proj of the Mar 7 - 28 - Apr 5 price swing
• RES 2: 138.32/140.00 High May 9 / High Apr 21 and the bull trigger
• RES 1: 137.98 Intraday high
• PRICE: 137.46 @ 06:54 BST May 31
• SUP 1: 135.33/133.93 50-day EMA / Low May 19
• SUP 2: 132.93/66 100-dma / Low May 12 and the bear trigger
• SUP 3: 132.20 50% retracement of the Mar 7 - Apr 21 bull phase
• SUP 4: 131.59 Low Mar 22

EURJPY traded higher Monday, narrowing the gap with first resistance at 138.32 / 140.00 - High May 9 / High Apr 21. The latter is the bull trigger. Key support has been defined at 132.66, the May 12 low. The recovery from this low threatened a recent bearish theme. If the cross clears the 138.83-140.00 zone, this would strengthen bullish conditions and represent an important bullish price event. Initial support is at 135.33, the 50-day EMA.

AUDUSD TECHS: Trading North Of The 50-Day EMA

• RES 4: 0.7343 61.8% retracement of the Apr 5 - May 12 bear leg
• RES 3: 0.7266 High May 4/5 and a bull trigger
• RES 2: 0.7245 50.0% retracement of the Apr 5 - May 12 bear leg
• RES 1: 0.7204 Intraday high
• PRICE: 0.7188 @ 07:00 BST May 31
• SUP 1: 0.7097/36 20-day EMA / Low May 25
• SUP 2: 0.6950/29 Low May 18 / Low May 12 and the bear trigger
• SUP 3: 0.6805 Low Jun 22 2020
• SUP 4: 0.6784 0.764 proj of the Apr 5 - May 2 - 4 price swing

AUDUSD extended recent strength into the Monday close and this reinforces the current bull theme. The resumption of gains put prices north of the 50-day EMA, at 0.7170 and has exposed resistance at 0.7266, the May 4/5 and a bull trigger. Gains are still considered corrective however and the primary trend direction is down. The bear trigger is 0.6829, May 12 low. A reversal lower would open firm support at 0.7036 initially, May 25 low.

USDCAD TECHS: Bear Cycle Still In Play

• RES 4: 1.3077 High May 16 and the bull trigger
• RES 3: 1.2982 High May 16
• RES 2: 1.2896 High May 18 and a key resistance
• RES 1: 1.2801 20-day EMA
• PRICE: 1.2667 @ 09:17 BST May 31
• SUP 1: 1.2651 Low May 30
• SUP 2: 1.2562 61.8% retracement of the Apr 5 - May 12 bull run
• SUP 3: 1.2536 2.0% 10-dma envelope
• SUP 4: 1.2459 Low Apr 21

USDCAD started the week on a softer note, trading lower Monday as it extends the current bear cycle. The cross has recently cleared both the 20- and 50-day EMAs and has also registered a print below 1.2660, the 61.8% retracement of the bull run from Apr 5 - May 12. A clear break of this level would open 1.2562, the 76.4% retracement. On the upside, a key short-term resistance has been defined at 1.2896, the May 18 high.

FIXED INCOME

BUND TECHS: (M2) Remains Below Its Recent Highs

• RES 4: 157.87 High Apr 7
• RES 3: 157.29 High Apr 8
• RES 2: 155.69/89/156.00 50-day EMA / High Apr 28
• RES 1: 155.33 High May 12
• PRICE: 152.35 @ Close of May 31
• SUP 1: 151.89/150.49 Low May 18 / Low May 9
• SUP 2: 150.15 0.764 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 3: 150.00 Psychological round number
• SUP 4: 149.49 Low Jul 13 2015 (cont)

Bund futures traded lower Monday, but the contract maintains a broadly sideways direction. The primary trend direction is down though. Fresh cycle lows in April and May have maintained the price sequence of lower lows and lower highs - the definition of a downtrend. Moving average studies are in a bear mode condition. A resumption of weakness would refocus attention on 150.49, the bear trigger. Firm trend resistance is unchanged at 156.00.

BOBL TECHS: (M2) Resistance Remains Intact

• RES 4: 129.770 High Mar 29
• RES 3: 129.350 High Apr 4 and a reversal point
• RES 2: 128.380 High May 12
• RES 1: 128.177 50-day EMA
• PRICE: 126.810 @ Close of May 31
• SUP 1: 126.610/126.010 Low May 18 / Low May 6 and a bear trigger
• SUP 2: 126.00 Round number support
• SUP 3: 125.450 0.618 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 4: 125.260 Low Apr 24 20014 (cont)

Bobl futures traded lower Monday but the contract remains in consolidation mode. Price, on May 12, challenged 128.310, Apr 14/28 high. A resumption of strength and a clear breach of 128.310 would highlight a break of the 50-day EMA, currently at 128.177. This would signal scope for a stronger corrective cycle. The primary trend remains down though, a resumption of weakness would refocus attention on the bear trigger at 126.010.

SCHATZ TECHS: (M2) Bearish Focus

• RES 4: 111.095 50.0% retracement of the Mar 7 - May 6 downleg
• RES 3: 111.000 Round number resistance
• RES 2: 110.855 High Apr 4
• RES 1: 110.569/110.690 50-day EMA / High May 12
• PRICE: 110.190 @ Close of May 31
• SUP 1: 110.110/109.980 Low May 18 / Low May 6 and bear trigger
• SUP 2: 109.777 0.618 proj of the Mar 7 - 30 - Apr 4 price swing
• SUP 3: 109.555 Low Oct 31 2011 (cont)
• SUP 4: 109.340 Low Oct 28 011 (cont)

Schatz futures remain inside its current range. The primary trend direction is down and a key short-term resistance at 110.690, May 13 high, remains intact. A recent bullish corrective cycle appears to be over and a resumption of weakness would refocus attention on the bear trigger at 109.980, May 6 low, where a break would resume the downtrend. The 50-day EMA, at 110.569, remains intact and this indicator represents an important resistance.

GILT TECHS: (U2) Trades Through Support

• RES 4: 120.00 Round number resistance
• RES 3: 119.25 High May 19
• RES 2: 118.63 High May 24 and key near-term resistance
• RES 1: 118.51 High May 26
• PRICE: 117.25 @ Close of May 30
• SUP 1: 117.04 Low May 30
• SUP 2: 116.53 1.00 proj of the May 19 - 24 - 26 price swing
• SUP 3: 115.70 Low May 9 and the bear trigger
• SUP 4: 115.50 1.00 proj of the May 19 - 24 - 26 price swing

Gilt futures traded below initial support Monday. The primary trend direction remains down and the pullback from recent highs is a bearish development that suggests the correction between May 9 - 12 is over. Attention is on the key support and bear trigger at 115.70 May 9 low. Key short-term resistance has been defined at 118.63, May 24 high, where a break is required to reinstate a short-term bullish bullish theme.

BTP TECHS: (M2) Key Support Still Intact

• RES 4: 135.23 High Apr 14
• RES 3: 133.53 High Apr 28
• RES 2: 132.37 50-day EMA
• RES 1: 131.24 High May 12
• PRICE: 128.40 @ Close May 30
• SUP 1: 127.24/125.54 Low May 11 and 24 / Low May 9
• SUP 2: 125.02 1.236 proj of the Mar 1 - 29 - 31 price swing
• SUP 3: 124.02 Low Mar 18 2020 (cont) and a major support
• SUP 4: 123.41 1.382 proj of the of the Mar 1 - 29 - 31 price swing

The primary trend condition in BTP futures is unchanged and remains bearish. A corrective (bullish) cycle that started May 9, remains in play though and the contract did on May 12, manage to trade above a trendline resistance drawn from the Mar 1 high. Price has since pulled back however a resumption of strength would open 133.53, Apr 28 high. Key support is at 125.54, May 9 low. A break of this level would resume the downtrend.

EQUITIES

EUROSTOXX50 TECHS: (M2) Maintains A Firm Short-Term Tone

• RES 4: 3944.00 High Mar 29 and a key resistance
• RES 3: 3888.00 High Apr 5
• RES 2: 3883.00 High Apr 21
• RES 1: 3850.00 High May 30
• PRICE: 3832.00 @ Close of May 30
• SUP 1: 3700.20 20-day EMA
• SUP 2: 3576.00/3466.00 Low May 19 / Low May 10 and bear trigger
• SUP 3: 3458.90 76.4% retracement of the Mar 7 - 29 rally
• SUP 4: 3400.00 Round number support

EUROSTOXX 50 futures maintain a firmer short-term tone following recent gains and the break above the 50-day EMA. Gains are still considered corrective, however, attention is on resistance at 3883.00, Apr 21 high and, the key resistance at 3944.00, the Mar 29 high. A break of the latter would strengthen current bullish conditions. On the downside, a firm short-term support has been defined at 3576.00, May 19 low.

E-MINI S&P (M2): Testing The 50-Day EMA

• RES 4: 4509.00 High Apr 21
• RES 3: 4393.25 High Apr 22
• RES 2: 4303.50 High Apr 26/28 and a key short-term resistance
• RES 1: 4190.56/4202.25 50-day EMA / Intraday high
• PRICE: 4164.25 @ 07:01 BST May 31
• SUP 1: 3960.50/3807.50 Low May 26 / Low May 20 and bear trigger
• SUP 2: 3801.97 38.2% of the Mar ‘20 - Jan ‘22 bull leg (cont)
• SUP 3: 3787.74 2.618 proj of the Mar 29 - Apr 18 - 21 price swing
• SUP 4: 3747.52 2.764 proj of the Mar 29 - Apr 18 - 21 price swing

S&P E-Minis remain firm following last week’s gains. The contract has traded above the 50-day EMA - the average intersects at 4190.56. A clear break of this average would strengthen current bullish conditions and signal potential for a climb towards a key resistance at 4303.50, the Apr 26/28 high. The recent climb is still considered corrective and the primary trend is down. A reversal lower would refocus attention on the bear trigger 3807.50.

COMMODITIES

BRENT TECHS: (N2) Clears Resistance And Exposes The Contract High

• RES 4: $129.97 - High Mar 7 and the bull trigger
• RES 3: $128.64 - 1.618 proj of the May 11 - 17 - 19 price swing
• RES 2: $126.97 - 1.50 proj of the May 11 - 17 - 19 price swing
• RES 1: $125.30 - 1.382 proj of the May 11 - 17 - 19 price swing
• PRICE: $123.92 @ 07:12 BST May 31
• SUP 1: $118.98 - Low May 30
• SUP 2: $112.69 - 20-day EMA
• SUP 3: $107.82 - 50-day EMA
• SUP 4: $105.70 - Low May 19 and a key support

Brent futures continue to climb. The contract has breached all key short term resistance levels. This strengthens the current bullish theme and signals scope for a climb towards the contract high of 129.94, the Mar 7 high. A break of this resistance would confirm a resumption of the primary uptrend. On the downside, the 20-day EMA, at $112.69, is seen as initial support. A break would instead threaten the current bull theme.

WTI TECHS: (N2) Clears The Contract High

• RES 4: $125.73 - 1.382 proj of the May 11 - 17 -19 price swing
• RES 3: $123.35 - 1.236 proj of the May 11 - 17 -19 price swing
• RES 2: $120.00 - Psychological Resistance
• RES 1: $119.42 - Intraday high
• PRICE: $118.99 @ 08:04 BST May 31
• SUP 1: $108.25 - 20-day EMA
• SUP 2: $103.24 - Low May 19 and a key support
• SUP 3: $100.00 - Round number support
• SUP 4: $96.93 - Low May 11

WTI futures have started the week on a firm note and are trading higher this morning. The contract has breached resistance at $116.43, the Mar 7 high and the former contract high. This confirms a resumption of the underlying uptrend and paves the way for a test of the $120.00 handle, and potentially beyond. Initial firm support is seen at $108.25, the 20-day EMA. A break of this average would highlight the start of a correction.

GOLD TECHS: Trading Closer To Its Recent Highs

• RES 4: $1919.9 - High Apr 29 and key resistance
• RES 3: $1909.8 - High May 5
• RES 2: $1879.9 - 50-day EMA
• RES 1: $1869.7 - High May 24
• PRICE: $1855.4 @ 08:20 BST May 31
• SUP 1: $1807.5/1787.0 - Low May 18 / Low May 16 and bear trigger
• SUP 2: $1780.4 - Low Jan 28 and a key support
• SUP 3: $1753.7 - Low Dec 15 2021
• SUP 4: $1749.3 - 1.236 proj of the Mar 8 - 29 - Apr 18 price swing

Gold maintains a firmer short-term tone and is trading closer to its recent highs. The yellow metal to test resistance at $1857.6, the 20-day EMA. This suggests potential for a test of the 50-day EMA at $1879.9. Gains are still considered corrective though and the primary trend direction is down. A resumption of bearish activity would refocus attention on the May 16 $1787.0 low.

SILVER TECHS: Monitoring The 20-Day EMA

• RES 4: $24.666 - High Apr 22
• RES 3: $23.974 - Low Mar 29
• RES 2: $22.998 - 50-day EMA
• RES 1: $22.168/446 - 20-day EMA / High May 27
• PRICE: $21.862 @ 08:44 BST May 31
• SUP 1: $21.283/20.464 - Low May 19 / Low May 13 and bear trigger
• SUP 2: $20.282 - 2.00 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 3: $20.000 - Psychological round number
• SUP 4: $19.581 - 2.236 proj of the Mar 8 - 29 - Apr 18 price swing

The Silver outlook remains bearish despite the recovery from $20.464, May 13 low. Recent weakness resulted in a break of $22.008, Feb 3 low and a bear trigger. The move lower reinforced the bearish theme and resulted in a breach of $21.427/423, Dec 15 2021 low and Sep 29 2021 low. Sights are on $20.000 next. Firm S/T resistance to watch is at $22.168 the 20-day EMA. It has been probed, a clear break would signal scope for a stronger recovery.