MNI DAILY TECHNICAL ANALYSIS - Stocks Nearing Key Support

Price Signal Summary – Stocks Nearing Key Support

• In the equity space, S&P E-minis remain vulnerable and price action is volatile. The contract sold off sharply Monday but recovered from the day low. Price has reversed sharply lower from yesterday’s high and attention is on the key short-term support and bear trigger at 4212.75. EUROSTOXX 50 futures remain vulnerable and volatile. Monday’s sharp accelerated sell-off reinforced the bearish threat. Former support at 4216.50, Jan 10 low has been cleared and this resulted in the break of a number of short-term support levels.
• In FX, EURUSD weakness has accelerated, and the pair has traded below support at 1.1222, Dec 15 low. This reinforces the current bearish threat and attention turns to the key support handle of 1.1186/85, the Nov 24 and Jul 1 2020 lows. GBPUSD remains vulnerable following recent weakness and is trading lower today. The pair has breached both the 20- and 50-day EMAs, reinforcing a short-term bearish threat and the potential for a deeper pullback. USDJPY recovered well through the Wednesday session thanks to a rallying greenback, boosting the pair well ahead of support at 113.47/49. The print below 113.49 earlier in the week negates a recent bullish candle pattern - a doji on Jan 14 and a return lower would open 113.43.
• On the commodity front, the uptrend in WTI futures has resumed following yesterday’s break of resistance at $87.10, Jan 20 high. This maintains the bullish price sequence of higher or higher highs and higher lows and moving average conditions remain in a bull mode. The rally in gold has stalled. Yesterday’s sharp sell-off exposes support at $1805.9, Jan 18 low and the base of the bull channel at $1794.1 - the channel is drawn off the Aug 9 low.
• In the FI space, Bund futures traded lower yesterday and remain below Monday’s high of 171.07. Key short-term resistance at 171.00 was only briefly probed Monday, the Jan 13 high. Recent price action in Gilt futures have defined 121.93, Jan 19 low, as a key support and bear trigger. Bearish trend conditions remain intact and short-term gains are considered corrective.

FOREIGN EXCHANGE

EURUSD TECHS: Bearish Threat Exposes Key Support

• RES 4: 1.1608 High Nov 9
• RES 3: 1.1483/1514 High Jan 14 and key resistance / Low Nov 5
• RES 2: 1.1421 High Jan 18
• RES 1: 1.1333 20-day EMA
• PRICE: 1.1217 @ 06:08 GMT Jan 27
• SUP 1: 1.1186/85 Low Nov 24 / Low Jul 1, 2020 and the bear trigger
• SUP 2: 1.1128 1.764 proj of the Jan - Mar - May 2021 price swing
• SUP 3: 1.1070 Low May 29, 2020
• SUP 4: 1.0976 2.00 proj of the Jan - Mar - May 2021 price swing

EURUSD weakness has accelerated and the pair has traded below support at 1.1222, Dec 15 low. This reinforces the current bearish threat and attention turns to the key support handle of 1.1186/85, the Nov 24 and Jul 1 2020 lows. A breach of this support would confirm a resumption of the broader downtrend. On the upside, initial resistance is seen at the 20-day EMA that intersects at 1.1333 today.

GBPUSD TECHS: Bearish Extension

• RES 4: 1.3913 High Sep 14, 2021
• RES 3: 1.3835 High Oct 20 and key resistance
• RES 2: 1.3728/49 200-dma / High Jan 13
• RES 1: 1.3566/ 3662 High Jan 24 High Jan 20
• PRICE: 1.3431 @ 06:14 GMT Jan 27
• SUP 1: 1.3409 Low Dec 29
• SUP 2: 1.3387 61.8% retracement of the Dec 8 - Jan 13 bull phase
• SUP 3: 1.3343 Low Dec 23
• SUP 4: 1.3301 76.4% retracement of the Dec 8 - Jan 13 bull phase

GBPUSD remains vulnerable following recent weakness and is trading lower today. The pair has breached both the 20- and 50-day EMAs, reinforcing a short-term bearish threat and the potential for a deeper pullback. The focus is on 1.3409, the Dec 29 low and 1.3387, a Fibonacci retracement. Initial firm resistance has been defined at 1.3662, Dec 20 high. Initial resistance is seen at 1.3566, the Jan 24 high.

EURGBP TECHS: Trend Needle Still Points South

• RES 4: 0.8553 High Dec 10 and 14
• RES 3: 0.8498 High Dec 23
• RES 2: 0.8465 High Dec 24
• RES 1: 0.8416/23 50-day EMA / High Jan 24
• PRICE: 0.8354 @ 06:18 GMT Jan 27
• SUP 1: 0.8342/8305 Low Jan 26 / Low Jan 20, lowest since 2020
• SUP 3: 0.8300 Base of the multi-year broad range
• SUP 4: 0.8282/77 Low Feb’20 / Dec’19 and key bear trigger
• SUP 4: 0.8242 50% Fibonacci Retracement 2015-2020 Upleg

The EURGBP outlook remains bearish despite the recent recovery from its multiyear low of 0.8305, Jan 20 low. Monday’s rally stalled at the 50-day EMA, currently at 0.8416. Short-term gains are considered corrective. The focus is on the major support and bear triggers at 0.8282/77, the Feb’20 and Dec’19 lows plus the base of a broad multi-year range at 0.8300. For bulls, clearance of the 50-day EMA would allow for a stronger correction.

USDJPY TECHS: Bounces, Leaving Support Intact

• RES 4: 118.07 2.236 proj of Apr 23 - Jul 2 - Aug 4 2021 price swing
• RES 3: 117.08 2.00 proj of Apr 23 - Jul 2 - Aug 4 2021 price swing
• RES 2: 115.85/116.35 High Jan 10 / Jan 4 high and the bull trigger
• RES 1: 115.06 High Jan 18
• PRICE: 114.69 @ 06:25 GMT Jan 27
• SUP 1: 113.47/49 Low Jan 24/14 and key short-term support
• SUP 2: 113.43 76.4% of the Nov 30 - Jan 4 rally
• SUP 3: 113.14 Low Dec 17
• SUP 4: 112.53/111.94 Low Nov 30 / 2.0% 10-dma envelope

USDJPY recovered well through the Wednesday session thanks to a rallying greenback, boosting the pair well ahead of support at 113.47/49. The print below 113.49 earlier in the week negates a recent bullish candle pattern - a doji on Jan 14 and a return lower would open 113.43, a Fibonacci retracement and 113.14, the Dec 17 low. Attention is on key near-term resistance at 115.06, Jan 18 high. A break would reinstate a bullish theme.

EURJPY TECHS: Remains Vulnerable

• RES 4: 132.04 76.4% retracement of the Oct 20 - Dec 3 downleg
• RES 3: 131.60 High Jan 5 and the bull trigger
• RES 2: 131.18 High Jan 18
• RES 1: 129.73/78 20- and 50-day EMA values
• PRICE: 128.67 @ 06:30 GMT Jan 27
• SUP 1: 128.25 Low Jan 25
• SUP 2: 128.05 Low Dec 21
• SUP 3: 127.39 Low Dec 6 and a major support
• SUP 4: 127.04 Low Feb 15, 2021

EURJPY is consolidating but remains vulnerable following the recent move lower and break below its 50-day EMA. Price Tuesday probed 128.38, a Fibonacci retracement. A clear break of this level would expose 127.39, the Dec 6 low and a key near-term support. Key short-term resistance has been defined at 131.60, Jan 5 high. Initial resistance though is at 129.73/78, the 20- and 50-day EMAs.

AUDUSD TECHS: Clears Support

• RES 4: 0.7371 High Nov 15
• RES 3: 0.7277/7314 High Jan 20 / High Jan 13
• RES 2: 0.7215 50-day EMA
• RES 1: 0.7130/7191 Low Jan 7 / 20-day EMA
• PRICE: 0.7072 @ 06:38 GMT Jan 27
• SUP 1: 0.7069/68 76.4% of the Dec 3 - Jan 13 upleg / Intraday low
• SUP 2: 0.7040 Low Dec 7
• SUP 3: 0.6993/91 Low Dec 3 / Low Nov 2, 2020 and key support
• SUP 4: 0.6963 Low Jul 16, 2020

AUDUSD is trading lower today and has cleared near-term support at 0.7082, Dec 20 low. 0.7069, 76.4% of the Dec 3 - Jan 13 upleg is under pressure too and a clear breach of this support would reinforce bearish conditions and clear the way for an extension towards the key support at 0.6993/91, the Dec 3 and Nov 2, 2020 lows. Moving average conditions remain in a bear mode, highlighting the current sentiment. Initial resistance is at 0.7191.

USDCAD TECHS: Resumes This Week’s Rally

• RES 4: 1.2843 76.4% retracement of the Dec 20 - Jan 19 sell-off
• RES 3: 1.2814 High Jan 6 and a key resistance
• RES 2: 1.2768 61.8% retracement of the Dec 20 - Jan 19 sell-off
• RES 1: 1.2732 High Jan 7
• PRICE: 1.2724 @ 06:46 GMT Jan 27
• SUP 1: 1.2625/2560 20-day EMA / Low Jan 264
• SUP 2: 1.2451/48 Low Jan 19 / 76.4% of the Oct - Dec rally
• SUP 3: 1.2387 Low Nov 10
• SUP 4: 1.2328 Low Oct 29

USDCAD has resumed this week’s climb and is extending its recovery from 1.2451, Jan 19 low. Price has traded above the 50-day EMA and the clear break of this average, at 1.2650, has exposed 1.2768, a Fibonacci retracement level. On the downside, initial support lies at Wednesday’s intraday low of 1.2560. Key support has been defined at 1.2451, Jan 19 low and marks the bear trigger.

FIXED INCOME

BUND TECHS: (H2) Remains Below Recent Highs

• RES 4: 171.99 50.0% retracement of the Aug 12 - Jan 19 downleg
• RES 3: 171.77 Low Nov 24 and recent breakout level
• RES 2: 171.55 50-day EMA
• RES 1: 171.07 High Jan 24
• PRICE: 169.83 @ 05:01 GMT Jan 27
• SUP 1: 169.66 Low Jan 26
• SUP 2: 168.95 Low Jan 19
• SUP 3: 168.84 3.764 proj of the Dec 8 - Dec 20 price swing
• SUP 4: 168.46 4.00 proj of the Dec 8 - Dec 20 price swing

Bund futures traded lower yesterday and remain below Monday’s high of 171.07. Key short-term resistance at 171.00 was only briefly probed Monday, the Jan 13 high. A clear break of this hurdle would signal potential for a stronger short-term recovery and open the 50-day EMA at 171.55. Broader trend conditions remain bearish however. The focus is on the bear trigger at 168.95, the Jan 19 low.

BOBL TECHS: (H2) Corrective Cycle Still In Play

• RES 4: 133.928 76.4% retracement of the Dec 20 - Jan 19 sell-off
• RES 3: 133.636 61.8% retracement of the Dec 20 - Jan 19 sell-off
• RES 2: 133.420 50-day EMA
• RES 1: 133.250 High Jan 24
• PRICE: 132.730 @ 05:07 GMT Jan 27
• SUP 1: 132.676 Intraday low
• SUP 2: 132.400 Low Jan 19 and the bear trigger
• SUP 3: 132.350 2.50 proj of the Nov 30 - Dec 8 - 20 price swing
• SUP 4: 132.253 2.618 proj of the Nov 30 - Dec 8 - 20 price swing

Despite the recent bounce, trend conditions in Bobl futures remain bearish. The breach of 133.110 Monday, the Jan 6 and 13 highs, however still suggests potential for a stronger short-term recovery ahead of resistance at the 50-day EMA at 133.420. For bears, last week’s break of 132.620, Jan 11 low maintains the bearish price sequence of lower lows and lower highs. The trigger for a resumption of the downtrend is 132.400, Jan 19 low.

SCHATZ TECHS: (H2) Off Recent Highs

• RES 4: 112.176 112.265 High Dec 20 and a key resistance
• RES 3: 112.250 High Dec 21
• RES 2: 112.176 76.4% retracement of the Dec 20 - Jan 19 downleg
• RES 1: 112.145 High Jan 24
• PRICE: 112.035 @ 05:04 GMT Jan 27
• SUP 1: 112.025 Intraday low
• SUP 2: 111.980/890 Low Jan 21 / Low Jan 19
• SUP 3: 112.861 1.618 proj of the Nov 26 - Dec 16 - 20 price swing
• SUP 4: 111.824 1.764 proj of the Nov 26 - Dec 16 - 20 price swing

Schatz futures have pulled back from recent highs. The recovery in price resulted in a move through both the 20- and 50-day EMAs. This still signals potential for a climb towards 112.176, a Fibonacci retracement. Clearance of this retracement would strengthen bullish conditions and open 112.265 further out, Dec 20 high. The broader trend condition is bearish though and a deeper pullback would refocus attention on key support at 111.890.

GILT TECHS: (H2) Key Short-Term Resistance Remains Intact

• RES 4: 124.80 50.0% retracement of the Dec 8 - Jan 19 downleg
• RES 3: 124.44 50-day EMA
• RES 2: 124.17 Low Nov 24
• RES 1: 123.79 High Jan 13 and a key near-term resistance
• PRICE: 122.89 @ Close Jan 26
• SUP 1: 121.93 Low Jan 19 and the bear trigger
• SUP 2: 121.61 Low Nov 13 2018 (cont)
• SUP 3: 121.12 Low Nov 8 2018 (cont)
• SUP 4: 120.98 3.0% Lower Bollinger Band

Recent price action in Gilt futures have defined 121.93, Jan 19 low, as a key support and bear trigger. Bearish trend conditions remain intact and short-term gains are considered corrective. Firm resistance is seen at 123.79, Jan 13 high. A break of this level would signal a short-term base and allow for a stronger corrective bounce towards 124.44, the 50-day EMA. A return lower would refocus attention on 121.93 again.

BTP TECHS: (H2) Bearish Outlook

• RES 4: 148.02 High Dec 29
• RES 3: 147.55 50-day EMA
• RES 2: 146.80 High Jan 14 and key short-term resistance
• RES 1: 146.49 High Jan 24
• PRICE: 145.22 @ Close Jan 26
• SUP 1: 144.55 Low Jan 19 and the bear trigger
• SUP 2: 144.08 3.00 proj of the Dec 6 - 18 - 14 price swing
• SUP 3: 143.57 3.236 proj of the Dec 6 - 18 - 14 price swing
• SUP 4: 143.26 3.382 proj of the Dec 6 - 18 - 14 price swing

Trend conditions in BTP futures remain bearish. This theme was reinforced by last week’s break of support at 145.12, Jan 10 low that confirmed a resumption of the primary downtrend and maintains a price sequence of lower lows and lower highs. This opens 144.08, a Fibonacci projection. Short-term gains are considered corrective and key resistance has been defined at 146.80, Jan 14 high. A break would highlight a short-term base.

EQUITIES

EUROSTOXX 50 TECHS: (H2) Volatile But Outlook Remains Bearish

• RES 4: 4392.50 High Nov 18 and key resistance
• RES 3: 4381.50 High Jan 5 and the bull trigger
• RES 2: 4324.50.50 High Jan 13
• RES 1: 4215.50/4220.80 High Jan 24 / 50-day EMA
• PRICE: 4049.00 @ 05:36 GMT Jan 27
• SUP 1: 3990.50 Low Jan 24
• SUP 2: 3980.00 Low Nov 30 2021
• SUP 2: 3935.00 Low Oct 6 2021
• SUP 4: 3895.00 Low Jul 19 2021 (cont)

EUROSTOXX 50 futures remain vulnerable and volatile. Monday’s sharp accelerated sell-off reinforced the bearish threat. Former support at 4216.50, Jan 10 low has been cleared and this resulted in the break of a number of short-term support levels. The focus is on 3980.00, Nov 30 low and 3935.00, Oct 6 low. Both are important supports and a break would threaten a deeper sell-off. Initial resistance is at Monday’s high of 4215.50.

E-MINI S&P (H2): Eyeing Monday’s Low

• RES 4: 4739.50 High Jan 12
• RES 3: 4471.75 High Jan 18
• RES 2: 4598.65 50-day EMA
• RES 1: 4446.25/4485.75 High Jan 26 / Low Dec 3
• PRICE: 4275.50 @ 06:52 GMT Jan 27
• SUP 1: 4212.75 Low Jan 24 and the bear trigger
• SUP 2: 4200.00 Round number support
• SUP 3: 4186.57 23.6% of the Mar ‘20 - Jan ‘22 major rally
• SUP 4: 4126.75 Low Jun 21, 2021 (cont)

S&P E-minis remain vulnerable and price action is volatile. The contract sold off sharply Monday but recovered from the day low. Price has reversed sharply lower from yesterday’s high and attention is on the key short-term support and bear trigger at 4212.75. The outlook is bearish and a break of this support would resume the trend. Resistance to watch is 4446.25, yesterday’s high.

COMMODITIES

BRENT TECHS: (H2) Uptrend Resumes

• RES 4: $95.00 Round number resistance
• RES 3: $93.89 - 2.236 proj of the Dec 2 - 9 - 20 price swing
• RES 2: $91.29 - 2.00 proj of the Dec 2 - 9 - 20 price swing
• RES 1: $90.47 - High Jan 26
• PRICE: $89.34 @ 06:59 GMT Jan 27
• SUP 1: $85.04 - Low Jan 24 and key near-term support
• SUP 2: $84.64 - 20-day EMA
• SUP 3: $80.98/50 - 50-day EMA / Low Jan 10
• SUP 4: $77.04 - Low Jan 3 and key support

Brent futures have resumed their uptrend following yesterday’s climb above former resistance at $89.50, the Jan 19 high. This maintains the bullish price sequence of higher or higher highs and higher lows and moving average conditions remain in a bull mode. $90.00 has been probed and the focus is on $91.29, a Fibonacci projection. On the downside, key short-term support has been defined at $85.04, the Jan 24 low.

WTI TECHS: (H2) Clears Resistance

• RES 4: $92.85 - 2.50 proj of the Dec 2 - 9 - 20 price swing
• RES 3: $91.58 - 2.382 proj of the Dec 2 - 9 - 20 price swing
• RES 2: $90.00 - Psychological round number
• RES 1: $87.95 - High Jan 26
• PRICE: $86.85@ 07:13 GMT Jan 27
• SUP 1: $81.90 - Low Jan 24
• SUP 2: $81.45 - 20-day EMA
• SUP 3: $77.69/77.34 - 50-day EMA / Low Jan 10
• SUP 4: $74.01 - Low Jan 3

The uptrend in WTI futures has resumed following yesterday’s break of resistance at $87.10, Jan 20 high. This maintains the bullish price sequence of higher or higher highs and higher lows and moving average conditions remain in a bull mode. Attention is the psychological $90.00 handle next as price continues to climb. On the downside, key short-term support has been defined at $81.90, the Jan 24 low.

GOLD TECHS: Recovery Stalls

• RES 4: $1903.1 - High Jun 11, 2021
• RES 3: $1877.2 - High Nov 16 and key resistance
• RES 2: $1871.0 - High Nov 18
• RES 1: $1853.9 - High Jan 25 and the bull trigger
• PRICE: $1814.5 @ 07:17 GMT Jan 27
• SUP 1: $805.9 - Low Jan 18
• SUP 2: $1794.1/82.8 - Channel base from Aug 9 low / Low Jan 7
• SUP 3: $1753.7 - Low Dec 15 and a key support
• SUP 4: $1746.0 - Low Oct 6

The rally in gold has stalled. Yesterday’s sharp sell-off exposes support at $1805.9, Jan 18 low and the base of the bull channel at $1794.1 - the channel is drawn off the Aug 9 low. For now, the move lower is considered corrective, however a break of the channel base will likely alter the picture and highlight a more significant reversal. For bulls, a break of $1853.9, Jan 25 high is required to reinstate the recent bull theme.

SILVER TECHS: Corrective Pullback Extends

• RES 4: $26.002 - High Aug 4 2021
• RES 3: $25.406 - High Nov 16
• RES 2: $24.886 - High Nov 22
• RES 1: $23.994/24.700 - High Jan 25 / High Jan 20
• PRICE: $23.282 @ 09:30 GMT Jan 27
• SUP 1: $23.093 - Intraday low
• SUP 2: $22.809/21.949 - Low Jan 17 / Low Jan 7
• SUP 3: $21.427/423 - Low Dec 15 / Low Sep 29 and key support
• SUP 4: $20.871 - 50.0% retracement of the Mar ‘20 - Feb ‘21 rally

Silver is off its recent highs and is lower again today. Technical conditions remain bullish however and the recent pullback is considered corrective. The recent breach of $23.436, Dec 28 high, reinforced bullish conditions following the bounce from $21.949, Jan 7 low. The move higher also highlights a bullish price sequence of higher highs and higher lows. A resumption of strength would open $24.700, Jan 20 high. Firm support is seen at $22.809.