MNI DAILY TECHNICAL ANALYSIS - Stocks Show Above 50-day EMA

Price Signal Summary - Stocks Show Above 50-day EMA

• In the equity space, S&P E-minis traded higher yesterday and futures are holding onto recent gains. The break of the 50-day EMA strengthened the case for bulls and this week's positive price action has resulted in a move above 4472.00, Oct 7 high and 4500.00. EUROSTOXX 50 futures are consolidating and in pattern terms, recent price action appears to be a bull flag. The clear breach of the 50-day EMA and the recent break of a number of resistance points has exposed 4200.50, the Sep 24 high.
• In FX, EURUSD is holding onto the bulk of recent gains. Price action this week has resulted in a break of the 20-day EMA and this signals scope for a stronger short-term corrective bounce with attention on the 50-day EMA at 1.1699. GBPUSD is trading near recent highs and the rally that started late September remains intact. The pair has recently traded through the 50-day EMA and Tuesday's technical break was a breach of 1.3795, 76.4% of the Sep 14 -29 downleg.
• On the commodity front, Gold is firmer this week. Attention though is on Friday's sharp sell-off that continues to highlight a potential bearish threat. Key short-term resistance has been defined at $1800.6, the Oct 14 high. WTI trend conditions remain bullish and the contract has traded to a fresh trend high today. The continued move higher maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend.
• In the FI space, the path of least resistance remains down. Bund futures remain in a downtrend. The contract traded lower yesterday and through support at 168.21, Oct 12 low. The break lower resumes the downtrend and paves the way for weakness towards 167.98 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low on the continuation chart. Gilt futures remain above recent lows. Recent gains are considered corrective and the bounce has allowed the recent oversold condition to unwind somewhat.

FOREIGN EXCHANGE

EURUSD TECHS: Eyeing The 50-Day EMA

• RES 4: 1.1821 High Sep 16
• RES 3: 1.1737/55 Bear channel from Jun 1 high / High Sep 22
• RES 2: 1.1699 50-day EMA
• RES 1: 1.1669 High Oct 19
• PRICE: 1.1652 @ 06:08 BST Oct 21
• SUP 1: 1.1572/24 Low Oct 18 / Low Oct 12 and the bear trigger
• SUP 2: 1.1493 50.0% retracement of the Mar '20 - Jan '21 bull phase
• SUP 3: 1.1469 1.236 proj of the Jan 6 - Mar 31 - May 25 price swing
• SUP 4: 1.1396 Bear channel base drawn from the Jun 1 high

EURUSD is holding onto the bulk of recent gains. Price action this week has resulted in a break of the 20-day EMA and this signals scope for a stronger short-term corrective bounce with attention on the 50-day EMA at 1.1699. Note there is a key resistance at 1.1737, the top of a bear channel drawn from the Jun 1 high. Broader trend conditions remain bearish and current gains are considered corrective. Key support and the bear trigger is 1.1524.

GBPUSD TECHS: Trading Near Recent Highs

• RES 4: 1.3983 High Jul 30
• RES 3: 1.3958 High Aug 4
• RES 2: 1.3913 High Sep 14 and a key resistance
• RES 1: 1.3854 High Sep 15
• PRICE: 1.3817 @ 06:17 BST Oct 21
• SUP 1: 1.3685 20-day EMA
• SUP 2: 1.3544 Low Oct 6
• SUP 3: 1.3411/12 2.0% 10-dma env / Low Sep 29 and the bear trigger
• SUP 4: 1.3354 Low Dec 23, 2020

GBPUSD is trading near recent highs and the rally that started late September remains intact. The pair has recently traded through the 50-day EMA and Tuesday's technical break was a breach of 1.3795, 76.4% of the Sep 14 -29 downleg. The break higher opens 1.3913, Sep 14 high and the next key resistance. On the downside, a firm short-term support is seen at 1.3685, the 20-day EMA.

EURGBP TECHS: Trend Needle Still Points South

• RES 4: 0.8624/58 High Oct 1 / High Sep 29
• RES 3: 0.8529 50-day EMA
• RES 2: 0.8518 High Oct 12 and a firm resistance
• RES 1: 0.8487 High Oct 15
• PRICE: 0.8434 @ 06:24 BST Oct 21
• SUP 1: 0.8423 Low Oct 19 / 20
• SUP 2: 0.8384 1.0% 10-dma envelope
• SUP 3: 0.8356 Low Feb 26, 2020
• SUP 4: 0.8339 Low Feb 25, 2020

EURGBP is consolidating near recent lows. The outlook remains bearish following the recent break of 0.8450, Oct 10 low and a key support. This paves the way for an extension lower, opening 0.8384 next, a vol based support. Further out, there is scope too for an extension below 0.8400 to open 0.8356, the Feb 26, 2020 low. Moving average conditions remain bearish, reinforcing current trend conditions. Initial firm resistance is 0.8518.

USDJPY TECHS: Dips Considered Corrective

• RES 4: 116.08 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 3: 115.51 High Mar 10, 2017
• RES 2: 114.99 1.50 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 1: 114.70/73 High Oct 20 / High Nov 6, 2017
• PRICE: 114.07 @ 06:32 BST Oct 21
• SUP 1: 113.65/00 Low Oct 15 / Low Oct 12
• SUP 2: 112.08 High Sep 30 and a recent breakout level
• SUP 3: 111.51 Low Oct 8
• SUP 4: 110.82/80 Low Oct 4 / High Aug 11

USDJPY dips are considered corrective. The outlook remains bullish and Wednesday's fresh trend high reinforces the current condition. A strong bullish theme follows the recent break of a long-term trendline (at 113.41) drawn off the Dec 1975 high. Bulls have not looked back and momentum remains firm. Attention is on 115.51, the Mar 10 2017 high. On the downside, initial firm support is seen at 112.08, Sep 30 high and a recent breakout level.

EURJPY TECHS: Uptrend Remains Intact

• RES 4: 134.40 2.382 proj of the Sep 22 - 29 - Oct 6 price swing
• RES 3: 134.13 High Jun 1 and a key resistance
• RES 2: 133.76 High Jun 10
• RES 1: 133.48 High Oct 20
• PRICE: 132.83 @ 06:41 BST Oct 21
• SUP 1: 132.15/131.27 Low Oct 18 / Low Oct 14
• SUP 2: 130.75 Sep 3 high
• SUP 3: 130.28 50-day EMA
• SUP 4: 129.28 Low Oct 11

EURJPY maintains a bullish tone and today's pullback is considered corrective. This week's gains confirm an extension of the upleg that started Oct 6. The cross has recently cleared 130.75, the Sep 3 high bull trigger and the rally has maintained an impulsive bullish drive since. The focus is on 133.76 next, Jun 10 high and 134.13, the Jun 1 high. Initial support is at 132.15, Oct 18 low.

AUDUSD TECHS: Northbound

• RES 4: 0.7716 High Jun 16
• RES 3: 0.7630 1.236 proj of the Aug 20 - Sep 3 - Sep 29 price swing
• RES 2: 0.7599 High Jul 6
• RES 1: 0.7546/57 Intraday high / 50.0% of the Feb - Aug sell-off
• PRICE: 0.7500 @ 06:54 BST Oct 21
• SUP 1: 0.7465/7379 Low Oct 20 / Low Oct 18
• SUP 2: 0.7351 50-day EMA
• SUP 3: 0.7288 Low Oct 8
• SUP 4: 0.7226/7170 Low Oct 6 / Low Sep 29

AUDUSD maintains a firmer short-term tone and has traded to a fresh high once again today. This week's gains have resulted in a break of 0.7478, the Sep 3 high and a bull trigger. The breach of this hurdle strengthens a bullish case and confirms a positive price sequence of higher highs and higher lows - the current bull phase started August 20. Potential is for a rally towards 0.7599, the Jul 6 high. Support has been defined at 0.7465/7379.

USDCAD TECHS: Bear Leg Extends

• RES 4: 1.2648 High Oct 6
• RES 3: 1.2551 50-day EMA
• RES 2: 1.2494 Low Sep 3 and a recent breakout level
• RES 1: 1.2410 High Oct 18
• PRICE: 1.2331 @ 07:00 BST Oct 21
• SUP 1: 1.2288 Intraday low
• SUP 2: 1.2253 Low Jun 23
• SUP 3: 1.2229 76.4% retracement of the Jun - Aug rally
• SUP 4: 1.2157 Low Jun 16

USDCAD remains in a bear cycle and continues to trade lower. A bearish theme follows the recent break of the Jul 30 low of 1.2422. This signals scope for an extension of the downleg and has opened 1.2253 next, the Jun 23 low. Note too that moving average conditions are in a bear mode and this reinforces current trend conditions. Initial firm resistance is seen at 1.2494, Sep 3 low. A break would ease bearish pressure.

FIXED INCOME

BUND TECHS: (Z1) Trend Conditions Remain Bearish

• RES 4: 171.72 High Sep 23
• RES 3: 170.76 50-day EMA
• RES 2: 170.55 High Oct 4
• RES 1: 169.48/92 High Oct 19 / High Oct 14 and key resistance
• PRICE: 168.52 @ 05:18 BST Oct 21
• SUP 1: 168.08 Low Oct 20
• SUP 2: 167.98 2.382 proj of the Sep 9 - 17 - 21 price swing
• SUP 3: 167.79 2.50 proj of the Sep 9 - 17 - 21 price swing
• SUP 4: 167.52 Low Mar 19 2020

Bund futures remain in a downtrend. The contract traded lower yesterday and through support at 168.21, Oct 12 low. The break lower resumes the downtrend and paves the way for weakness towards 167.98 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low on the continuation chart. Moving average signals continue to point south, reinforcing the current sentiment. Initial key resistance is seen at 169.92, the Oct 14 high.

BOBL TECHS: (Z1) Needle Still Points South

• RES 4: 135.200 Low Sep 17, high Oct 4 and recent breakout level
• RES 3: 135.060 High Oct 7
• RES 2: 134.860 High Oct 14 and key resistance
• RES 1: 134.580 High Oct 18
• PRICE: 134.320 @ 05:22 BST Oct 21
• SUP 1: 134.045 1.50 proj of the Sep 21 - 28 - Oct 4 price swing
• SUP 2: 134.070 Low Jul 6 (cont)
• SUP 3: 133.954 1.618 proj of the Sep 21 - 28 - Oct 4 price swing
• SUP 4: 133.842 1.764 proj of the Sep 21 - 28 - Oct 4 price swing

Bobl futures remain bearish and the contract traded to a fresh trend low once again yesterday. This confirms a resumption of the underlying downtrend and reinforces bearish conditions. Key resistance has been defined at 134.860, Oct 14 high and a breach of this level is required to signal scope for a short-term reversal. With momentum still pointing south, the focus is on 134.045, a Fibonacci projection.

SCHATZ TECHS: (Z1) Volatile But Remains Bearish

• RES 4: 112.290 High Sep 20
• RES 3: 112.255 High Sep 23 and Oct 5 and key near-term resistance
• RES 2: 112.220 High Oct 14
• RES 1: 112.183 20-day EMA
• PRICE: 112.130 @ 05:28 BST Oct 21
• SUP 1: 112.025 2.00 proj of the Sep 20 - 28 - Oct 5 price swing
• SUP 2: 112.00 Round number support
• SUP 3: 111.990 Low Aug 14 and 26, 2020 (cont)
• SUP 4: 111.967 2.50 proj of the Sep 20 - 28 - Oct 5 price swing

From a trend perspective, Schatz futures remain in a downtrend, although price action has been volatile this week. Fresh lows reinforce the downtrend and the break lower this week confirms a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. The focus is on 112.025 next, a Fibonacci projection. On the upside, initial resistance is at 112.183, the 20-day EMA.

GILT TECHS: (Z1) Bearish Focus

• RES 4: 126.84 Low Sep 17
• RES 3: 126.44 High Sep 24
• RES 2: 125.72 High Oct 1
• RES 1: 125.27 High Oct 14 and key near-term resistance
• PRICE: 124.09 @ Close Oct 20
• SUP 1: 123.83/123.44 Low Oct 20 / Low Oct 11 and the bear trigger
• SUP 2: 123.16 Low Feb 27, 2019 (cont)
• SUP 3: 122.75 2.236 proj of the Aug 31 - Sep 17 - 21 price swing
• SUP 4: 122.15 Low Jan 18, 2019 (cont)

Gilt futures remain above recent lows. Recent gains are considered corrective and the bounce has allowed the recent oversold condition to unwind somewhat. Key near-term resistance has been defined at 125.27, the Oct 14 high where a break is required to signal scope for a stronger recovery. The path of least resistance remains down and a resumption of weakness would refocus attention on last week's low of 123.44, the bear trigger.

BTP TECHS: (Z1) Fresh Trend Low

• RES 4: 155.14 High Aug 31
• RES 3: 154.64 High Sep 22 / 23
• RES 2: 153.59 High Sep 24
• RES 1: 152.54/87 High Oct 14 and key resistance / High Oct 1
• PRICE: 151.33 @ Close Oct 20
• SUP 1: 150.79 Low Oct 19
• SUP 2: 150.56 Low Jun 30 (cont)
• SUP 3: 150.00/149.97 Round number support / Low Jun 25
• SUP 4: 148.77 61.8% retracement of the May - Aug rally (cont)

BTP futures traded to a fresh trend low again yesterday and the outlook remains bearish. A key short-term resistance has been defined at 152.54, Oct 14 high where a break is required to signal a potential short-term base. The trend remains bearish and a resumption of weakness would open 150.56 next, the Jun 30 low on the continuation chart. Moving average conditions remain in a bear mode condition, reinforcing the current trend direction.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Bull Flag

• RES 4: 4234.50 0.764 projection of the Jul 19 - Sep 6 - 20 price swing
• RES 3: 4223.00 High Sep 6 and the bull trigger
• RES 2: 4200.50 High Sep 24
• RES 1: 4175.00 High Oct 15
• PRICE: 4151.00 @ 05:56 BST Oct 21
• SUP 1: 4099.10 50-day EMA
• SUP 2: 4004.00 / 3949.50 Low Oct 12 / Low Oct 6 and bear trigger
• SUP 3: 3902.50 Low Jul 20
• SUP 4: 3882.00 Low Jul 19 and a key support

EUROSTOXX 50 futures are consolidating and in pattern terms, recent price action appears to be a bull flag. Price action has recently cleared the 50-day EMA. The clear breach of this average and the recent break of a number of resistance points has exposed 4200.50, the Sep 24 high. Above this level is the major resistance and bull trigger at 4223.00, Sep 6 high. On the downside, the 50-day EMA, at 4101.50 today, marks initial support.

E-MINI S&P (Z1): Approaching The All-Time High

• RES 4: 4600.00 Round number resistance
• RES 1: 4591.25 1.00 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 3: 4539.50 High Sep 3 and the bull trigger
• RES 1: 4519.75 High Sep 9
• PRICE: 4517.00 @ 07:04 BST Oct 21
• SUP 1: 4398.57 50-day EMA
• SUP 2: 4317.25/4260.00 Low Oct 12 / Low Oct 1 and the bear trigger
• SUP 3: 4243.50 Low Jul 20
• SUP 4: 4214.50 Low Jul 19 and a key support

S&P E-minis traded higher yesterday and futures are holding onto recent gains. Price action on Oct 14 resulted in a move above the 50-day EMA. The break has strengthened the case for bulls and this week's positive price action has resulted in a move above 4472.00, Oct 7 high and 4500.00. This opens 4539.50, Sep 3 high and a bull trigger. A key support is at 4317.25, Oct 12 low. The 50-day EMA at 4403.64 is first support.

COMMODITIES

BRENT TECHS: (Z1) Fresh Trend High

• RES 4: $90.00 - Psychological round number
• RES 3: $88.74 - 2.00 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 2: $86.55 - 1.764 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 1: $86.10 - Intraday high
• PRICE: $85.468 @ 07:00 BST Oct 21
• SUP 1: $83.61 - Low Oct 20
• SUP 2: $82.20/81.10 - Low Oct 13 / 20-day EMA
• SUP 3: $79.08/78.75 - Low Oct 7 and key support / Low Oct 4
• SUP 4: $76.51/75.42 - Low Sep 30 and key support / High Sep 15

The bull trend in Brent futures remains intact with a fresh trend high print registered overnight. The continued move higher resumes the uptrend and maintains the bullish price sequence of higher highs and higher lows. Note too that the futures have recently cleared the $80.00 handle, an important psychological hurdle. The focus is on $86.55 next, a Fibonacci projection. Initial firm short-term support is seen at $83.61, Oct 20 low.

WTI TECHS: (Z1) Still Climbing

• RES 4: $87.45 - 1.236 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 3: $86.00 - Round number resistance
• RES 2: $85.01 - 1.00 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 1: $83.96 - Intraday high
• PRICE: $83.22 @ 07:08 BST Oct 21
• SUP 1: $80.78 - Low Oct 20
• SUP 2: $78.78 - Low Oct 13
• SUP 3: $77.76 - 20-day EMA
• SUP 4: $74.67 - Low Oct 7 and key near-term support

WTI trend conditions remain bullish and the contract has traded to a fresh trend high today. The continued move higher maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend. Note that the $80.00 psychological hurdle has also recently been cleared, an important break. The focus is on $85.01 next, a Fibonacci projection. On the downside, key short-term support has been defined at $80.78, Oct 20 low.

GOLD TECHS: Resistance Remains Intact

• RES 4: $1844.9 - Low Jun 14
• RES 3: $1834.1 - High Jul 15 and the bull trigger
• RES 2: $1808.7 - High Sep 14
• RES 1: $1800.6 - High Oct 14 and key short-term resistance
• PRICE: $1786.8 @ 07:22 BST Oct 21
• SUP 1: $1758.3 - Low Oct 13
• SUP 2: $1746.0 - Low Oct 6 and key near-term support
• SUP 3: $1721.7 - Low Sep 29 and the bear trigger
• SUP 4: $1717.8 - Low Aug 10

Gold is firmer this week. Attention though is on Friday's sharp sell-off that continues to highlight a potential bearish threat. Key short-term resistance has been defined at $1800.6, the Oct 14 high. A resumption of weakness would expose support at $1746.0, Oct 6 low and clearance of this level would reinforce a bearish threat and attention would turn to $1721.7, Sep 29 low. For bulls, a break of $1800.6 would reinstate the recent bullish theme.

SILVER TECHS: Bulls In Charge

• RES 4: $26.002 - High Aug 4
• RES 3: $25.206 - High Jun 8
• RES 2: $24.867 - High Sep 3 and the reversal trigger
• RES 1: $24.481 - Intraday high
• PRICE: $24.305 @ 07:30 BST Oct 21
• SUP 1: $23.015 - Low Oct 18
• SUP 2: $22.213 - Low Oct 6
• SUP 3: $21.423 - Low Sep 29
• SUP 4: $20.871 - 50.0% retracement of the Mar '20 - Feb '21 rally

Silver maintains a short-term bullish tone. Last week the metal cleared the 20-day EMA and price has this week cleared the 50-day EMA. A continuation would pave the way for a stronger short-term recovery and open $24.867, the Sep 3 high. Clearance of this level would strengthen the case for bulls and open the $26.00 handle. Initial firm support to watch is at $23.015, Oct 18 low.