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MNI DAILY TECHNICAL ANALYSIS - Stocks Confirm Primary Downtrend

Price Signal Summary – Clear Break of Support Confirms Primary Downtrend for Stocks

  • S&P E-Minis maintain a bearish tone. Monday’s sell-off resulted in a break of 3810.00, the May 20 low and bear trigger. The clear break of this support confirmed a resumption of the primary downtrend. EUROSTOXX 50 futures gains are considered corrective and the primary trend direction remains down. The move lower this week has resulted in a breach of key support at 3466.00, the May 10 low.
  • EURUSD traded higher Thursday after a volatile session. A bearish threat remains present. Recent weakness, following a recent reversal at the top of the bear channel drawn from the Feb 10 high, highlights a bearish threat. EURGBP has pulled back from recent highs. The move lower is considered corrective. Recent gains and Tuesday’s breach of resistance at 0.8619, May 12 high, confirmed a resumption of the current uptrend. The USDJPY uptrend remains intact and the recent sell-off is likely a correction. A print above 135.00 this week reinforces the bull trend and maintains the positive price sequence of higher highs and higher lows.
  • Gold remains vulnerable short-term, despite the latest recovery. The yellow metal has recently failed to remain above the 50-day EMA and this highlights a bearish threat and signals the potential end of the recent correction between May 16 - Jun 13. The WTI futures outlook is unchanged and the uptrend remains firmly intact. For now though, the contract is in a corrective cycle and price has traded below support at the 20-day EMA, although the contract has recovered from yesterday’s low of $112.31.
  • Bund futures traded in a volatile manner on Thursday. The trend remains down. Price has recently cleared 150.97, May 9 low, and the 150.00 handle. Gilt futures outlook remains bearish and yesterday’s sharp sell-off has once again confirmed a resumption of the primary downtrend. Price did recover from session lows but gains are considered corrective.

FOREIGN EXCHANGE

EURUSD TECHS: Bearish Threat Remains Present

  • RES 4: 1.0852 High Apr 22
  • RES 3: 1.0787 High May 30
  • RES 2: 1.0689/0774 Bear channel top from Feb 10 high / High Jun 9
  • RES 1: 1.0601 High Jun 16
  • PRICE: 1.0525 @ 06:10 BST Jun 17
  • SUP 1: 1.0359 Low Jun 15
  • SUP 2: 1.0350 Low May 13 and bear trigger
  • SUP 3: 1.0341 Low Jan 3 2017 and a key support
  • SUP 4: 1.0168 Bear channel base, drawn from the Feb 10 high

EURUSD traded higher Thursday after a volatile session. A bearish threat remains present. Recent weakness, following a recent reversal at the top of the bear channel drawn from the Feb 10 high, highlights a bearish threat. The channel top intersects at 1.0689 today. The reversal lower also signals a resumption of the primary downtrend and attention is on 1.0350, May 13 low. Initial firm resistance is at 1.0601, Thursday’s high.

GBPUSD TECHS: Corrective Bounce

  • RES 4: 1.2667 High May 27 and a reversal trigger
  • RES 3: 1.2586 50-day EMA
  • RES 2: 1.2518 High Jun 10
  • RES 1: 1.2405/06 20-day EMA / High Jun 16
  • PRICE: 1.2309 @ 06:18 BST Jun 17
  • SUP 1: 1.2042 Low Jun 16
  • SUP 2: 1.1934 Low Jun 14 and High Mar 20 2020
  • SUP 3: 1.1795 0.764 proj of the Mar 23 - May 13 - 27 price swing
  • SUP 4: 1.1777 Low Mar 26 2020

GBPUSD rallied sharply higher yesterday and remains above this week’s lows. Gains are considered corrective and the primary trend direction remains down. A resumption of weakness would refocus attention on Tuesday’s low of 1.1934 that also marks the short-term bear trigger. A break would confirm a resumption of the downtrend. Initial firm resistance is seen at 1.2405, the 20-day EMA. Yesterday’s high was 1.2406.

EURGBP TECHS: Pullback Considered Corrective

  • RES 4: 0.8852 50.0% retracement of the Mar ‘20 - Mar ‘22 bear leg
  • RES 3: 0.8762 1.00 proj of the Apr 14 - May 12 - 17 price swing
  • RES 2: 0.8721 High May 26 2021 and Wednesday’s high
  • RES 1: 0.8634 High Jun 16
  • PRICE: 0.8554 @ 06:32 BST Jun 17
  • SUP 1: 0.8512 Low Jun 16
  • SUP 2: 0.8488 50-day EMA
  • SUP 3: 0.8433 Low May 23
  • SUP 4: 0.8393 Low May 17 and a key support

EURGBP has pulled back from recent highs. The move lower is considered corrective. Recent gains and Tuesday’s breach of resistance at 0.8619, May 12 high, confirmed a resumption of the current uptrend. The break reinforces bullish conditions and moving average studies continue to point north. The focus is on a climb to 0.8721 next, Apr 26 and Wednesday’s high. A break would resume the uptrend. Firm support is seen at 0.8488, the 50-day EMA.

USDJPY TECHS: Trend Conditions Remains Bullish

  • RES 4: 138.56 1.618 proj of the Feb 24 - Mar 28 - 31 price swing
  • RES 3: 137.30 1.50 proj of the Feb 24 - Mar 28 - 31 price swing
  • RES 2: 136.04 1.382 proj of the Feb 24 - Mar 28 - 31 price swing
  • RES 1: 135.59 High Jun 15
  • PRICE: 133.91 @ 06:40 BST Jun 17
  • SUP 1: 131.68/50 20-day EMA / Low Jun 16
  • SUP 2: 130.43 Low Jun Low Jun 6
  • SUP 3: 130.00 Round number support
  • SUP 4: 128.81 50-day EMA

The USDJPY uptrend remains intact and the recent sell-off is likely a correction. A print above 135.00 this week reinforces the bull trend and maintains the positive price sequence of higher highs and higher lows. Moving average studies also point north, reinforcing bullish conditions. The focus is on the 136.04, a Fibonacci projection. Initial firm support is seen at 131.68, the 20-day EMA and Thursday’s low of 131.50.

EURJPY TECHS: Finds Support

  • RES 4: 145.58 High Dec 31 2014
  • RES 3: 145.00 Round number resistance
  • RES 2: 144.25/58 High Jun 8 / 0.764 proj of Mar 7 - 28 - Apr 5 swing
  • RES 1: 142.79 High Jun 10
  • PRICE: 141.08 @ 06:49 BST Jun 17
  • SUP 1: 137.85/38.31 Low Jun 16 / 2.0% 10-dma envelope
  • SUP 2: 137.48 50-day EMA
  • SUP 3: 136.25 Low May 30
  • SUP 4: 134.99 Low May 25

EURJPY outlook deteriorated Thursday, however the cross has recovered from the session low. The recent pullback is considered corrective and the primary trend remains up. The climb above 140.00 confirmed a resumption of the uptrend that began Mar 7. MA studies still point north, reinforcing current conditions and signals scope for a continuation higher towards 144.58 next, a Fibonacci projection. Firm S/T support is seen at 137.48, the 50-day EMA.

AUDUSD TECHS: Key Support Remains Exposed

  • RES 4: 0.7400 Round number resistance
  • RES 3: 0.7343 61.8% retracement of the Apr 5 - May 12 bear leg
  • RES 2: 0.7140/7283 50-day EMA / High Jun 3 and the bull trigger
  • RES 1: 0.7082 20-day EMA
  • PRICE: 0.7014 @ 06:58 BST Jun 17
  • SUP 1: 0.6851 Low Jun 14
  • SUP 2: 0.6829 Low May 12 and the bear trigger
  • SUP 3: 0.6805 Low Jun 22 2020
  • SUP 4: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing

AUDUSD remains above 0.6851, the Jun 14 low. Short-term gains are considered corrective though and a bearish threat remains present. A resumption of weakness would signal scope for a test of key support and the bear trigger at 0.6829, the May 12 low. Clearance of this support would confirm a resumption of the downtrend and open 0.6805, the Jun 22 2020 low. On the upside, 0.7063, Jun 13 high is seen as an initial firm resistance.

USDCAD TECHS: Holding Onto Its Recent Gains

  • RES 4: 1.3192 1.00 proj of the Apr 5 - May 12 - Jun 8 price swing
  • RES 3: 1.3113 High Nov 23 2020
  • RES 2: 1.3077 High May 16 and the bull trigger
  • RES 1: 1.2995 High June 15
  • PRICE: 1.2965 @ 07:04 BST Jun 17
  • SUP 1: 1.2861/2774 Low Jun 16 / 20-day EMA
  • SUP 2: 1.2518 Low Jun 8 and key support
  • SUP 3: 1.2459 Low Apr 21
  • SUP 4: 1.2403 Low Apr 5 and key support

USDCAD is trading closer to its recent highs and the outlook remains bullish. A fresh short-term trend high on Wednesday reinforces bullish conditions. This week’s gains have also resulted in a break of 1.2945, 76.4% of the bear leg between May 12 - Jun 8. The breach is a positive development and signals potential for a climb towards key resistance at 1.3077, the May 16 high. Initial firm support is at 1.2774, the 20-day EMA.

FIXED INCOME

BUND TECHS: (U2) Fresh Cycle Low

  • RES 4: 150.97 Low May 9
  • RES 3: 148.92 20-day EMA
  • RES 2: 147.19/148.51 High Jun 13 / High Jun 10
  • RES 1: 145.58 High Jun 14
  • PRICE: 143.84 @ 05:05 BST Jun 17
  • SUP 1: 140.67 Low Jun 16
  • SUP 2: 140.00 Psychological round number
  • SUP 3: 138.68 Low Jan 2 2014 (cont)
  • SUP 4: 138.33 3.00 proj of the Apr 28 - May 9 - 12 price swing

Bund futures traded in a volatile manner on Thursday. The trend remains down. Price has recently cleared 150.97, May 9 low, and the 150.00 handle. This marked a resumption of the downtrend and maintains a bearish price sequence of lower lows and lower highs. Bears haven’t looked back and fresh lows yesterday reinforce current conditions. The focus is on the 140.00 psychological level. Firm resistance is at 148.92, the 20-day EMA.

BOBL TECHS: (U2) Fresh Cycle Low

  • RES 4: 123.675 20-day EMA
  • RES 3: 123.280 High Jun 10
  • RES 2: 122.660 High Jun 13
  • RES 1: 122.390 High Jun 15
  • PRICE: 121.160 @ 05:14 BST Jun 17
  • SUP 1: 119.940 Low Jun 16
  • SUP 2: 119.590 4.00 proj of the May 12 - 18 - 26 price swing
  • SUP 3: 119050 Low Jul 29 2011 (cont)
  • SUP 4: 118.420 Low Jul 27 2011

Bobl futures remain soft and the primary downtrend remains intact. A fresh cycle low Thursday reinforces bearish conditions. The recent breach of 124.840, May 6 low confirmed a resumption of the bear cycle and maintains the broader bearish price sequence of lower lows and lower highs. The focus is on 119.590 next, a Fibonacci projection. Initial firm resistance is still seen at 123.675, the 20-day EMA.

SCHATZ TECHS: (U2) Trend Needle Still Points South

  • RES 4: 109.300 High Jun 2
  • RES 3: 109.180 High Jun 3 and 9
  • RES 2: 108.871 20-day EMA
  • RES 1: 108.495/108.715 High Jun 13 / High Jun 9
  • PRICE: 107.990 @ 05:25 BST Jun 17
  • SUP 1: 107.705 Low Jun 16
  • SUP 2: 107.662 3.50 proj of the May 12 - 18 - 26 price swing
  • SUP 3: 107.589 3.618 proj of the May 12 - 18 - 26 price swing
  • SUP 4: 107.430 Low Jul 4 2011 (cont)

Schatz futures remain in a downtrend and short-term gains are considered corrective. Fresh cycle lows this week reinforce the downtrend and confirm an extension of the bearish price sequence of lower lows and lower highs. This also suggests scope for a continuation of the trend. The focus is on 107.662 next, a Fibonacci projection. On the upside, initial firm resistance is seen at 108.871, the 20-day EMA.

GILT TECHS: (U2) Bear Trend Acceleration

  • RES 4: 115.55 High Jun 6
  • RES 3: 114.83 20-day EMA
  • RES 2: 114.28 High Jun 10
  • RES 1: 113.25 High Jun 15
  • PRICE: 111.19 @ Close Jun 16
  • SUP 1: 109.89/60 Low Jun 16 / 4.5 proj of May 19 - 24 - 26 swing
  • SUP 2: 109.33 Low Jul 8 2014 (cont)
  • SUP 3: 108.98 Low Jul 7 2014 (cont)
  • SUP 4: 108.73 Low Jul 3 2014 (cont)

Gilt futures outlook remains bearish and yesterday’s sharp sell-off has once again confirmed a resumption of the primary downtrend. Price did recover from session lows but gains are considered corrective. The move lower this week has confirmed an acceleration of the downtrend and indications are that the trend is set to extend. The focus is on 109.60 next, a Fibonacci projection. Initial firm resistance is seen at 113.25, Wednesday’s low.

BTP TECHS: (U2) Bearish Outlook

  • RES 4: 123.88 Low May 9 and a recent breakout level
  • RES 3: 121.55 20-day EMA
  • RES 2: 119.99 High Jun 10
  • RES 1: 119.20 High Jun 16
  • PRICE: 118.28 @ Close Jun 17
  • SUP 1: 113.78 Low Jun 14
  • SUP 2: 113.22 3.764 proj of the May 12 - 24 - 26 price swing
  • SUP 3: 112.31 4.00 proj of the May 12 - 24 - 26 price swing
  • SUP 4: 110.83 4.382 proj of the May 12 - 24 - 26 price swing

The primary trend condition in BTP futures remains bearish and the recovery from recent lows is likely a correction. A bearish theme was reinforced Tuesday as price traded lower, confirming an extension of the downtrend. The move lower also maintains the bearish price sequence of lower lows and lower highs. 120.00 has been cleared, the focus is on 113.22 next, a Fibonacci projection. Initial firm resistance is at 121.55, the 20-day EMA.

EQUITIES

EUROSTOXX50 TECHS: (M2) Key Support Remains Exposed

  • RES 4: 3888.00 High Apr 5
  • RES 3: 3883.00 High Apr 21
  • RES 2: 3857.00 High Jun 6 and key short-term resistance
  • RES 1: 35830.00/3701.50 High Jun 16 / 50-day EMA
  • PRICE: 3461.00 @ 05:47 BST Jun 17
  • SUP 1: 3401.00 Low Jun 16
  • SUP 2: 3400.00 Round number support
  • SUP 3: 3379.00 1.00 proj of the Mar 29 - May 10 - Jun 6 price swing
  • SUP 4: 3309.00 Low Mar 7 and major support

EUROSTOXX 50 futures gains are considered corrective and the primary trend direction remains down. The move lower this week has resulted in a breach of key support at 3466.00, the May 10 low. This reinforces bearish conditions and signals potential for weakness towards the next key support at 3309.00, the Mar 7 low and a bear trigger. On the upside, initial firm resistance is seen at 3701.50, the 50-day EMA.

E-MINI S&P (U2): Resumes Its Downtrend

  • RES 4: 4396.75 High Apr 22
  • RES 3: 4308.50 High Apr 28
  • RES 2: 4098.76/4204.75 50-day EMA / High May 31
  • RES 1: 3843.00/3961.01 High Jun 15 / 20-day EMA
  • PRICE: 36951.50 @ 07:02 BST June 17
  • SUP 1: 3642.00 Low Jun 16
  • SUP 2: 3578.27 0.618 proj of the Mar 29 - May 20 - 31 price swing
  • SUP 3: 3500.00 Round number support
  • SUP 4: 3384.75 0.764 proj of the Mar 29 - May 20 - 31 price swing

S&P E-Minis maintain a bearish tone. Monday’s sell-off resulted in a break of 3810.00, the May 20 low and bear trigger. The clear break of this support confirmed a resumption of the primary downtrend. Thursday’s weakness has also highlighted an extension of the bear cycle and price has cleared 3697.99 next, the 0.618 projection of the Mar 29 - May 20 - 31 price swing. The focus is on 3600.00. Firm resistance is seen at 3961.01, the 20-day EMA.

COMMODITIES

BRENT TECHS: (Q2) Trend Outlook Remains Bullish

  • RES 4: $130.00 - Psychological round number
  • RES 3: $126.95 - 1.764 proj of the May 11 - 17 - 19 price swing
  • RES 2: $125.04 - 1.618 proj of the May 11 - 17 - 19 price swing
  • RES 1: $124.42/25.19 - High Mar 7 and the bull trigger / High Jun 14
  • PRICE: $119.40 @ 07:11 BST Jun 17
  • SUP 1: $115.56 - Low Jun 16
  • SUP 2: $112.45 - Low Jun 2
  • SUP 3: $111.64 - 50-day EMA
  • SUP 4: $103.84 - Low May 19 and a key support

Brent futures have pulled back from recent highs. The move lower this week is considered corrective - for now. The trend is up and a positive price sequence of higher highs and higher lows is intact. Scope is seen for a retest and clear break of 124.42, Mar 7 high. This would confirm a resumption of the primary uptrend. On the downside, the 20-day EMA was breached yesterday but price has recovered from the session low. Support to watch is at $115.56.

WTI TECHS: (N2) Remains Above Yesterday’s Low

  • RES 4: $127.65 - 1.382 proj of the May 11 - 17 -19 price swing
  • RES 3: $125.73 - 1.382 proj of the May 11 - 17 -19 price swing
  • RES 2: $124.00 - Round number resistance
  • RES 1: $123.68 - High Jun 14 and fresh cycle high
  • PRICE: $117.16 @ 07:52 BST Jun 17
  • SUP 1: $112.31 - Low Jun 16
  • SUP 2: $109.50 - 50-day EMA
  • SUP 3: $103.24 - Low May 19 and a key support
  • SUP 4: $100.00 - Round number support

The WTI futures outlook is unchanged and the uptrend remains firmly intact. For now though, the contract is in a corrective cycle and price has traded below support at the 20-day EMA, although the contract has recovered from yesterday’s low of $112.31. This is seen as a key short-term support and a resumption of gains would refocus attention on 123.68, Jun 14 high and the near-term bull trigger. A break would confirm a resumption of the uptrend.

GOLD TECHS: Bearish Threat Still Present

  • RES 4: $1909.8 - High May 5
  • RES 3: $1889.1 - Trendline resistance drawn from the Mar 8 high
  • RES 2: $1878.4 - High Jun 13
  • RES 1: $1865.6 - 50-day EMA
  • PRICE: $1846.7 @ 07:24 BST Jun 17
  • SUP 1: $1805.2 - Low Jun 14
  • SUP 2: $1787.0 - Low May 16 and bear trigger
  • SUP 3: $1780.4 - Low Jan 28 and a key support
  • SUP 4: $1753.7 - Low Dec 15 2021

Gold remains vulnerable short-term, despite the latest recovery. The yellow metal has recently failed to remain above the 50-day EMA and this highlights a bearish threat and signals the potential end of the recent correction between May 16 - Jun 13. An extension lower would open the key support and bear trigger at $1787.0, May 16 low. A break would resume the downtrend. Key trendline resistance is at $1889.1.

SILVER TECHS: Bearish Outlook

  • RES 4: $24.666 - High Apr 22
  • RES 3: $23.974 - Low Mar 29
  • RES 2: $22.502 - 50-day EMA
  • RES 1: $22.517 - High Jun 6
  • PRICE: $21.814 @ 08:05 BST Jun 17
  • SUP 1: $20.896/20.464 - Low Jun 13 / 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

Silver remains below its recent highs and Monday’s sell-off reinforced a bearish theme. The metal recently tested levels above resistance at $22.446, May 27 high. A clear break of this level is still required to suggest scope for an extension higher that would open the 50-day EMA at $22.502. For bears, a resumption of weakness would signal potential for a move towards key support and the bear trigger at $20.464, May 13 low.

MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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