MNI DAILY TECHNICAL ANALYSIS - Stocks Trade Through Key Support

Price Signal Summary – Stocks Trade Through Key Support

• In the equity space, S&P E-minis remain vulnerable following last week’s sharp sell-off. The move lower through the 50-day EMA has accelerated and key support at 4485.75 has been cleared, Dec 3 low. EUROSTOXX 50 futures remain vulnerable and price traded lower Friday. Former support at 4216.50, Jan 10 low has been cleared. The break of this level reinforces a bearish theme and confirms a resumption of the bear cycle that started Jan 5.
• In FX, EURUSD is consolidating and a short-term bearish threat remains present. This follows the recent break below both the 20- and 50-day EMAs. The move lower highlights the fact that the recent bullish technical developments - a range breakout and breach of a bear channel resistance - have failed to deliver a reversal. GBPUSD has started the week on a softer note. The pair has breached the 20-day EMA and is approaching its 50-day EMA at 1.3506. USDJPY has pulled back from its most recent high of 115.06 on Jan 18. The pair remains above the Jan 14 low and key support at 113.49. The recent recovery from this low is a bullish development and this is highlighted by a reversal signal on Jan 14 - a doji candle pattern.
• On the commodity front, Gold short-term conditions remain bullish following last Wednesday’s strong rally. The climb resulted in a break of resistance at $1831.9, Jan 3 high and a bull trigger. WTI futures remain in an uptrend, however for now the contract appears to have entered a short-term corrective phase following the pullback from last week’s high of $87.10.
• In the FI space, Bund futures remain above recent lows. The outlook is bearish though following last week’s resumption of the downtrend - key support at 169.34, Oct 29 low has been breached. Gilt futures traded sharply lower last week before rebounding. Bearish trend conditions remain intact and last week’s move lower resulted in a break of former support at 122.78, Jan 10 low.

FOREIGN EXCHANGE

EURUSD TECHS: Bearish Risk Still Present

• RES 4: 1.1692 High Oct 28, 2021
• RES 3: 1.1608 High Nov 9
• RES 2: 1.1483/1514 High Jan 14/ Low Nov 5
• RES 1: 1.1421 High Jan 18
• PRICE: 1.1322 @ 06:05 GMT Jan 24
• SUP 1: 1.1301 Low Jan 21
• SUP 2: 1.1272 Low Jan 04
• SUP 3: 1.1260/22 1.0% 10-dma envelope / Low Dec 15
• SUP 4: 1.1186/85 Low Nov 24 / Low Jul 1, 2020 and the bear trigger

EURUSD is consolidating and a short-term bearish threat remains present. This follows the recent break below both the 20- and 50-day EMAs. The move lower highlights the fact that the recent bullish technical developments - a range breakout and breach of a bear channel resistance - have failed to deliver a reversal. Further downside would expose 1.1272, Jan 4 low. Key resistance is at 1.1483, Jan 14 high.

GBPUSD TECHS: Support Creaking

• RES 4: 1.3913 High Sep 14, 2021
• RES 3: 1.3835 High Oct 20 and key resistance
• RES 2: 1.3733/49 200-dma / High Jan 13
• RES 1: 1.3662 High Jan 20
• PRICE: 1.3542 @ 06:17 GMT Jan 24
• SUP 1: 1.3506 50-day EMA
• SUP 2: 1.3456 50.0% retracement of the Dec 8 - Jan 13 bull phase
• SUP 3: 1.3409 Low Dec 29
• SUP 4: 1.3387 50.0% retracement of the Dec 8 - Jan 13 bull phase

GBPUSD has started the week on a softer note. The pair has breached the 20-day EMA and is approaching its 50-day EMA at 1.3506. For now, the recent pullback is still considered corrective with moving average conditions remaining in a bull mode. A decisive break of the 50-day EMA however would alter the picture and instead suggest scope for a deeper pullback. Initial resistance is at 1.3662, Jan 20 high.

EURGBP TECHS: Short-term Resistance Remains Intact

• RES 4: 0.8498 High Dec 23
• RES 3: 0.8465 High Dec 24
• RES 2: 0.8419/21 High Jan 3 / 50-day EMA
• RES 1: 0.8379 High Jan 18 and key near-term resistance
• PRICE: 0.8357 @ 06:24 GMT Jan 24
• SUP 1: 0.8305 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

EURGBP traded once again to a fresh multiyear low of 0.8305 last week. This reinforces the current bearish theme with attention on the major support and bear triggers at 0.8282/77, the Feb’20 and Dec’19 lows. The focus is also on the base of a broad multi-year range at 0.8300 - a key pivot chart point. Initial firm resistance is at 0.8379, Jan 18 high. A break would signal scope for a stronger short-term correction.

USDJPY TECHS: Support Intact For Now

• 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: 115.68/116.35 High Jan 11 / High Jan 4 and the bull trigger
• RES 1: 115.06 High Jan 18
• PRICE: 113.81 @ 06:30 GMT Jan 24
• SUP 1: 113.61 Low Jan 21
• SUP 2: 113.49/43 Low Jan 14 / 76.4% of the Nov 30 - Jan 4 rally
• SUP 3: 113.14 Low Dec 17
• SUP 4: 112.20 2.0% 10-dma envelope

USDJPY has pulled back from its most recent high of 115.06 on Jan 18. The pair remains above the Jan 14 low and key support at 113.49. The recent recovery from this low is a bullish development and this is highlighted by a reversal signal on Jan 14 - a doji candle pattern. A resumption of gains would open 115.68, Jan 11 high and the key resistance at 116.35. A break lower through through 113.49 would instead reinstate a bearish threat.

EURJPY TECHS: Remains Under Pressure

• RES 4: 132.45/56 3% Upper Bollinger Band / High Nov 4
• RES 3: 132.04 76.4% retracement of the Oct 20 - Dec 3 downleg
• RES 2: 131.60 High Jan 5 and the bull trigger
• RES 1: 130.03/131.18 20-day EMA / High Jan 18
• PRICE: 128.84 @ 06:36 GMT Jan 24
• SUP 1: 128.56 Low Jan 21
• SUP 2: 128.38 76.4% retracement of the Dec 3 - Jan 5 high
• SUP 3: 128.05 Low Dec 21
• SUP 4: 127.39 Low Dec 6 and a major support

EURJPY remains under pressure having failed to hold onto recent highs.The move lower continues to threaten the recent bullish theme and the cross is back below its 50-day EMA. Price is approaching 128.38, a Fibonacci retracement, where a break would expose 178.39, the Dec 6 low and a key support. Key short-term resistance has been defined at 131.60, Jan 5 high. Initial resistance though is at 130.03, the 20-day EMA.

AUDUSD TECHS: Bearish Extension

• RES 4: 0.7393 High Nov 10
• RES 3: 0.7371 High Nov 15
• RES 2: 0.7360 Former channel base drawn from the Aug 20 low
• RES 1: 0.7277/7314 High Jan 20 / High Jan 13
• PRICE: 0.7159 @ 06:49 GMT Jan 24
• SUP 1: 0.7149 Low Jan 10
• SUP 2: 0.7130 Low Jan 7
• SUP 3: 0.7082 Low Dec 20 and a key support
• SUP 4: 0.7069 76.4% retracement of the Dec 3 - Jan 13 upleg

AUDUSD failed to hold onto Thursday’s high and remains vulnerable. The recent sell-off represents a concern for bulls and today’s move lower exposes 0.7130, Jan 7 low. The 3-day price action between Dec 12 -14 is an evening star candle pattern and a strong short-term reversal signal. A turn higher and importantly a break of 0.7314, Jan 13 high, is needed to cancel the reversal pattern and resume the recent upleg.

USDCAD TECHS: Gains Considered Corrective

• RES 4: 1.2924 High Dec 22
• RES 3: 1.2814 High Jan 6 and a key resistance
• RES 2: 1.2732 High Jan 7
• RES 1: 1.2617/21 20-day EMA and Low Dec 31
• PRICE: 1.2577 @ 06:54 GMT Jan 24
• SUP 1: 1.2451/48 Low Jan 19 / 76.4% of the Oct - Dec rally
• SUP 2: 1.2387 Low Nov 10
• SUP 3: 1.2328 Low Oct 29
• SUP 4: 1.2288 Low Oct 21 and a key support

USDCAD remains above recent lows. The outlook is bearish and a recent head and shoulders reversal pattern continues to highlight this theme. The recent break of support at 1.2621, Dec 31 low strengthened the case for bears and this focus is on 1.2448, 76.4% of the Oct - Dec rally. A move through this chart point would open 1.2387, the Nov 10 low. Initial resistance is at 1.2617/21, the 20-day EMA and Dec 31 low.

FIXED INCOME

BUND TECHS: (H2) Remains Above Recent Lows

• RES 4: 171.77 Low Nov 24 and recent breakout level
• RES 3: 171.67 50-day EMA
• RES 2: 171.00 High Jan 13
• RES 1: 170.70 20-day EMA
• PRICE: 170.20 @ 04:58 GMT Jan 24
• SUP 1: 168.95 Low Jan 19
• SUP 2: 168.84 3.764 proj of the Dec 8 - Dec 20 price swing
• SUP 3: 168.46 4.00 proj of the Dec 8 - Dec 20 price swing
• SUP 4: 168.00 Round number support

Bund futures remain above recent lows. The outlook is bearish though following last week’s resumption of the downtrend - key support at 169.34, Oct 29 low has been breached. An extension lower and a clear break strengthens bearish conditions and opens 168.84 next, a Fibonacci projection. Key short-term resistance has been defined at 171.00, the Jan 13 high. Clearance of this level would signal a short-term reversal.

BOBL TECHS: (H2) Trend Outlook Remains Bearish

• RES 4: 133.530 High Dec 29
• RES 3: 133.260 High Jan 3 and 4
• RES 2: 133.110 High Jan 6 and 13 and key resistance
• RES 1: 133.017 20-day EMA
• PRICE: 132.840 @ 05:05 GMT Jan 24
• SUP 1: 132.400 Low Jan 19 and the bear trigger
• SUP 2: 132.350 2.50 proj of the Nov 30 - Dec 8 - 20 price swing
• SUP 3: 132.253 2.618 proj of the Nov 30 - Dec 8 - 20 price swing
• SUP 4: 132.230 Low Mar 19, 2019 (cont)

Despite the recent bounce, trend conditions in Bobl futures remain bearish. Price breached former support at 132.620 last week, Jan 11 low and a bear trigger. This confirmed a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. The move lower opens 132.350 next, a Fibonacci projection level. On the upside, key short-term resistance to watch is at 133.110, Jan 6 and 13 high.

SCHATZ TECHS: (H2) Gains Considered Corrective

• RES 4: 112.176 76.4% retracement of the Dec 20 - Jan 19 downleg
• RES 3: 112.122 61.8% retracement of the Dec 20 - Jan 19 downleg
• RES 2: 112.080/090 High Jan 5 / 50-day EMA
• RES 1: 112.060 High Jan 21 and intraday high
• PRICE: 112.035 @ 04:45 GMT Jan 22
• SUP 1: 111.980/890 Low Jan 21 / Low Jan 19
• SUP 2: 112.861 1.618 proj of the Nov 26 - Dec 16 - 20 price swing
• SUP 3: 111.824 1.764 proj of the Nov 26 - Dec 16 - 20 price swing
• SUP 4: 111.800 Round number support

Schatz futures have recovered from last Wednesday’s low. Despite the strong rebound, short-term gains are considered corrective. The moving average set-up remains in a bear mode and this highlights a downtrend. Furthermore, last week’s move lower resulted in a break of support at 111.935, Jan 11 low and a bear trigger. This reinforces current bearish conditions. Resistance is seen at 112.90, the 50-day EMA.

GILT TECHS: (H2) Key S/T Resistance Remains Intact

• RES 4: 124.46 High Jan 4
• RES 3: 124.17 Low Nov 24
• RES 2: 123.79 High Jan 13 and a key near-term resistance
• RES 1: 123.53 High Jan 21
• PRICE: 123.21 @ Close Jan 21
• SUP 1: 121.93 Low Jan 19
• 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

Gilt futures traded sharply lower last week before rebounding. Bearish trend conditions remain intact and last week’s move lower resulted in a break of former support at 122.78, Jan 10 low. This confirms a resumption of the downtrend and maintains a bearish price sequence of lower lows and lower highs. The focus is on 121.61 next, the Nov 13 2018 low (cont). Firm resistance is seen at 123.79 where a break would signal a short-term base.

BTP TECHS: (H2) Corrective Bounce

• RES 4: 148.02 High Dec 29
• RES 3: 147.39 High Jan 3
• RES 2: 146.80 High Jan 14 and key short-term resistance
• RES 1: 146.44 20-day EMA
• PRICE: 145.79 @ Close Jan 24
• SUP 1: 144.55 Low Jan 19
• 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

BTP futures bearish trend conditions remain intact and further weakness is likely near-term. Futures last week cleared support at 145.12, Jan 10 low to confirm a resumption of the primary downtrend and maintain a sequence of lower lows and lower highs. The focus is on 144.08 next, a Fibonacci projection. Key short-term resistance has been defined at 146.80, Jan 14 high. A break of this hurdle would highlight a short-term base.

EQUITIES

EUROSTOXX 50 TECHS: (H2) Bearish Theme

• RES 4: 4426.80 1.382 proj of the Nov 30 - Dec 8 - 20 price swing
• RES 3: 4392.50 High Nov 18 and key resistance
• RES 2: 4324.50/81.50 High Jan 13 / High Jan 5 and the bull trigger
• RES 1: 4236.60 50-day EMA
• PRICE: 4198.00 @ 05:41 GMT Jan 24
• SUP 1: 4204.00 Intraday low
• SUP 2: 4161.80 61.8% retracement of the Dec 20 - Jan 5 rally
• SUP 3: 4109.90 76.4% retracement of the Dec 20 - Jan 5 rally
• SUP 4: 4026.00 Low Dec 20

EUROSTOXX 50 futures remain vulnerable and price traded lower Friday. Former support at 4216.50, Jan 10 low has been cleared. The break of this level reinforces a bearish theme and confirms a resumption of the bear cycle that started Jan 5. The focus is on 4161.80 next, a Fibonacci retracement. On the upside, resistance to watch is at 4324.50, the Nov 18 high. Initial resistance is at 4236.60, the 50-day EMA.

E-MINI S&P (H2): Needle Points South

• RES 4: 4808.25 High Jan 4 and the bull trigger
• RES 3: 4739.50/52.67 High Jan 12 / 76.4% of the Jan 4 - 10 sell-off
• RES 2: 4594.25/671.75 High Jan 20 / High Jan 18
• RES 1: 4487.00 High Jan 21
• PRICE: 4481.25 @ 06:53 GMT Jan 24
• SUP 1: 4383.85/81.25 76.4% of t Oct 2021 - Jan rally / Low Jan 21
• SUP 2: 4311.00 Low Oct 12
• SUP 3: 4252.75 Low Oct 1 and a key support
• SUP 4: 4215.00 Low Jul 19, 2021

S&P E-minis remain vulnerable following last week’s sharp sell-off. The move lower through the 50-day EMA has accelerated and key support at 4485.75 has been cleared, Dec 3 low. The break of 4485.75 significantly strengthens the current bearish threat and signals potential for an extension lower towards 4383.85, a Fibonacci retracement that was briefly probed Friday. A break would open 4311.00, Oct 12 low. Initial resistance is at 4487.00.

COMMODITIES

BRENT TECHS: (H2) Outlook Remains Bullish

• RES 4: $93.89 - 2.236 proj of the Dec 2 - 9 - 20 price swing
• RES 3: $91.29 - 2.00 proj of the Dec 2 - 9 - 20 price swing
• RES 2: $90.00 - Psychological round number
• RES 1: $89.50 - High Jan 19
• PRICE: $88.40 @ 06:58 GMT Jan 24
• SUP 1: $85.71/83.52 - Low Jan 24 / Low Jan 12
• SUP 2: $83.37/80.50 - 20-day EMA / Low Jan 10
• SUP 3: $80.06 - 50-day EMA
• SUP 4: $77.04 - Low Jan 3 and key support

Brent futures remain below recent highs. A short-term pullback is considered corrective with trend conditions still bullish. Recent gains through key resistance at $83.69, Oct 10 high confirmed a resumption of the broader uptrend and a bullish price sequence of higher highs and higher lows remains intact. The focus is on the $90.00 handle next, a Fibonacci projection. Initial firm support to watch is at $85.71, the Jan 21 low.

WTI TECHS: (H2) Corrective Pullback

• RES 4: $91.58 - 2.382 proj of the Dec 2 - 9 - 20 price swing
• RES 3: $90.00 - Psychological round number
• RES 2: $87.47 - 2.00 proj of the Dec 2 - 9 - 20 price swing
• RES 1: $87.10 - High Jan 20
• PRICE: $85.51 @ 07:04 GMT Jan 24
• SUP 1: $82.78/80.55 - Low Jan 24 / Low Jan 12
• SUP 2: $80.01/77.34 - 20-day EMA / Low Jan 10
• SUP 3: $76.70/74.01 - 50-day EMA / Low Jan 3
• SUP 4: $72.22 - Low Dec 27

WTI futures remain in an uptrend, however for now the contract appears to have entered a short-term corrective phase following the pullback from last week’s high of $87.10. The recent break of key resistance at $80.72, Oct 26 high reinforced a bullish theme - the break higher confirmed a resumption of the broader uptrend. The focus is on $87.47, a Fibonacci projection. Firm support is seen at $82.78, the Jan 24 low.

GOLD TECHS: Heading North

• RES 4: $1877.2 - High Nov 16 and key resistance
• RES 3: $1871.0 - High Nov 18
• RES 2: $1849.1 - High Nov 22
• RES 1: $1848.0 - 76.4% retracement of the Nov 16 - Dec 15 downleg
• PRICE: $1837.7 @ 07:19 GMT Jan 24
• SUP 1: $1805.9 - Low Jan 18
• SUP 2: $1791.6/82.8 - 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

Gold short-term conditions remain bullish following last Wednesday’s strong rally. The climb resulted in a break of resistance at $1831.9, Jan 3 high and a bull trigger. The breach reinforces bullish conditions following the recent recovery from the base of its bull channel drawn from the Aug 9, 2021 low. Attention is on $1848.0 next, a Fibonacci retracement. Firm short-term support has been defined at $1805.9.

SILVER TECHS: Trend Needle Points North

• RES 4: $26.002 - High Aug 4 2021
• RES 3: $25.406 - High Nov 16
• RES 2: $24.886 - High Nov 22
• RES 1: $24.700 - High Jan 20
• PRICE: $24.130 @ 07:24 GMT Jan 24
• SUP 1: $23.391 - Low Jan 19
• 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 traded higher last week. The climb resulted in a breach of key short-term resistance at $23.436, Dec 28 high and this has reinforced bullish conditions following the recent bounce from $21.949, Jan 7 low. The move through $23.436 also highlights a bullish price sequence of higher highs and higher lows. Scope is seen for gains towards $24.886 next, the Nov 22 high. A firm support has been defined at $22.809.