MNI DAILY TECHNICAL ANALYSIS - USD/CAD’s Post-BoC Recovery Reinforces Bullish Theme

Price Signal Summary – USD/CAD’s Post-BoC Recovery Reinforces Bullish Theme

• The uptrend in S&P E-Minis remains intact and this week’s move higher reinforces current conditions. Resistance at 4841.50, the Dec 28 high has recently been cleared, confirming an extension of the price sequence of higher highs and higher lows. Eurostoxx 50 futures have recovered from last week’s low of 4402.00 on Jan 17 and the contract traded sharply higher Wednesday. 4402.00 represents a key short-term support. A break of it would resume recent bearish pressure and open 4370.00.
• EURUSD failed to hold on to Wednesday’s high of 1.0932 and remains inside the recent range. A break of 1.0932 would signal scope for a stronger recovery and expose key short-term resistance at 1.0998, the Jan 5 high. The USDJPY trend needle continues to point north and the pair is trading closer to its recent highs. Resistance at 146.41, the Jan 11 high, has recently been cleared and this confirmed a resumption of the bull cycle. Sights are on 149.16 next. USDCAD maintains a firmer tone and the latest recovery reinforces a bullish theme. Price has traded above the 50-day EMA, at 1.3461, and sights are on resistance at 1.3542, the Jan 17 high and bull trigger.
• Gold remains above the Jan 17 low of $2001.9 - for now. The recent print below the 50-day EMA and the break of support at $2013.4, the Jan 11 low, has strengthened a bearish threat and a resumption of weakness would open a key level at $1973.2. Trend signals in WTI futures remain bearish and the latest recovery still appears to be a correction - for now. The contract has traded through the 50-day EMA at $74.28. This opens $76.31, the Dec 26 high and a near-term bull trigger.
• A clear downtrend in Bund futures remains intact and price is trading below both the 20- and 550-day EMAs. The recent move lower strengthens the current bear trend and maintains the price sequence of lower lows and lower highs. The trend needle in Gilt futures continues to point south and yesterday’s low print reinforces current conditions. The contract last week cleared support at 99.60, the Jan 5 low. This confirmed a resumption of the downtrend that started Dec 27.

EURUSD TECHS: Resistance Remains Intact

• RES 4: 1.1139 High Dec 28 and the bull trigger
• RES 3: 1.1077 76.4% retracement of the Dec 28 - Jan 5 sell-off
• RES 2: 1.1046 High Jan 2
• RES 1: 1.0932/98 High Jan 24 / 5 and a reversal trigger
• PRICE: 1.0877 @ 05:55 GMT Jan 25
• SUP 1: 1.0822 Low Jan 23 and the bear trigger
• SUP 2: 1.0793 50.0% retracement of the Oct - Dec bull leg
• SUP 3: 1.0724 Low Dec 8
• SUP 4: 1.0712 61.8% retracement of the Oct - Dec bull leg

EURUSD failed to hold on to Wednesady’s high of 1.0932 and remains inside the recent range. A break of 1.0932 would signal scope for a stronger recovery and expose key short-term resistance at 1.0998, the Jan 5 high. Clearance of this level would highlight a potential reversal. On the downside, a break of 1.0822, Tuesday’s low, would resume the recent bearish theme. This would open 1.0793, a Fibonacci retracement.

GBPUSD TECHS: Directional Parameters Defined

• RES 4: 1.2996 High Jul 27
• RES 3: 1.2881 76.4% retracement of the Jul 14 - Oct 4 bear leg
• RES 2: 1.2827 High Dec 28 and the bull trigger
• RES 1: 1.2775 High Jan 24
• PRICE: 1.2710 @ 06:12 GMT Jan 25
• SUP 1: 1.2597 Low Jan 17 and key short-term support
• SUP 2: 1.2525 38.2% retracement of the Oct 4 - Dec 28 bull phase
• SUP 3: 1.2500 Low Dec 13
• SUP 4: 1.2432 50.0% retracement of the Oct 4 - Dec 28 bull phase

GBPUSD continues to trade inside its range with key resistance defined at 1.2827, the Dec 28 high and key support at 1.2597. Both levels represent important directional parameters. A clear break of 1.2827 would resume the uptrend and open 1.2881, a Fibonacci retracement. For bears, clearance of 1.2597 would highlight a short-term reversal and signal scope for weakness towards the 1.2500 handle, the Dec 13 low.

EURGBP TECHS: Bearish Outlook

• RES 4: 0.8768 High Nov 20
• RES 3: 0.8715 High Dec 28 and the bull trigger
• RES 2: 0.8676 High Jan 3
• RES 1: 0.8596/22 20- and 50-day EMA values
• PRICE: 0.8558 @ 06:23 GMT Jan 25
• SUP 1: 0.8536 Low Jan 24
• SUP 2: 0.8524 Low Sep 5
• SUP 3: 0.8493 Low Aug 23 2023 and a key medium-term support
• SUP 4: 0.8454 61.8% of the Mar 7 - Sep 26 ‘23 bull phase

EURGBP traded lower again Wednesday. The cross has pierced support at 0.8549, the Dec 11 low, and a bear threat remains present. Moving average studies are in a bear-mode position too, highlighting a clear downtrend. A firm break of 0.8549 would strengthen the current condition and open 0.8493, Aug 23 ‘23 low and a key support. The 50-day EMA, at 0.8622, is the initial firm resistance to watch. Clearance of the average would ease bearish pressure.

USDJPY TECHS: Short-Term Trend Structure Remains Bullish

• RES 4: 150.78 High Nov 17
• RES 3: 149.75 High Nov 22
• RES 2: 149.16 76.4% retracement of the Nov 13 - Dec 28 bull leg
• RES 1: 148.80 High Jan 19
• PRICE: 147.72 @ 06:42 GMT Jan 25
• SUP 1: 146.66 Low Jan 24
• SUP 2: 145.93 50- day EMA
• SUP 3: 144.36 Low Jan 12 and key S/T support
• SUP 4: 143.42 Low Jan 9

The USDJPY trend needle continues to point north and the pair is trading closer to its recent highs. Resistance at 146.41, the Jan 11 high, has recently been cleared and this confirmed a resumption of the bull cycle. Sights are on 149.16 next, a Fibonacci retracement. Key short-term support has been defined at 144.36, the Jan 12 low. A break of this level is required to signal a top. Initial firm support lies at 145.93, the 50-day EMA.

EURJPY TECHS: Trend Structure Remains Bullish

• RES 4: 164.30 High Nov 16 and key resistance
• RES 3: 163.72 High Nov 27
• RES 2: 162.25 High Nov 29
• RES 1: 161.86 High Jan 19
• PRICE: 160.82 @ 07:05 GMT Jan 25
• SUP 1: 159.53 20-day EMA
• SUP 2: 158.55 Low Jan 12 and a key short-term support
• SUP 3: 157.21 Low Jan 9
• SUP 4: 156.08 Low Jan 4

EURJPY trend conditions remain bullish and the latest pullback appears to be a correction. Recent gains resulted in a breach of 160.18, the Jan 11 high. The break confirmed a resumption of the uptrend and note that 161.69, 76.4% of the Nov 16 - Dec 7 bear leg, has been pierced. A clear break of this retracement would open 162.25, the Nov 29 high. Initial firm support lies at 158.55, the Jan 12 low.

AUDUSD TECHS: Bearish Theme

• RES 4: 0.6900 High Jun 16 and a key resistance
• RES 3: 0.6871 High Dec 28 and the bull trigger
• RES 2: 0.6729/71 High Jan 12 / 3
• RES 1: 0.6630 50-day EMA
• PRICE: 0.6581 @ 08:05 GMT Jan 25
• SUP 1: 0.6526/25 Low Dec 7 and key support / Low Jan 17
• SUP 2: 0.6500 61.8% Fibonacci retracement for Oct - Dec upleg
• SUP 3: 0.6453 Low Nov 17
• SUP 4: 0.6412 76.4% Fibonacci retracement for Oct - Dec upleg

AUDUSD remains in consolidation mode. A bearish theme dominates following recent weakness. On Jan 16, the pair breached a trendline drawn from the late October low. That break strengthens a bearish theme and signals scope for a deeper correction with attention on 0.6526, the Dec 7 low and the next key support. A clear break of this support would open 0.6500, a Fibonacci retracement. Initial resistance is at 0.6630, the 50-day EMA.

USDCAD TECHS: Bullish Trend Structure

• RES 4: 1.3661 High Nov 27
• RES 3: 1.3623 61.8% retracement of the Nov 1 - Dec 27 bear leg
• RES 2: 1.3608 High Dec 13
• RES 1: 1.3542 High Jan 17
• PRICE: 1.3520 @ 07:58 GMT Jan 25
• SUP 1: 1.3430/3343 20-day EMA / Low Jan 12
• SUP 2: 1.3288/3177 Low Jan 5 / Low Dec 27
• SUP 3: 1.3093 Low Jul 14 and key support
• SUP 4: 1.3158 2.0% 10-dma envelope

USDCAD maintains a firmer tone and the latest recovery reinforces a bullish theme. Price has traded above the 50-day EMA, at 1.3461, and sights are on resistance at 1.3542, the Jan 17 high and bull trigger. A break of this level would confirm a resumption of the bull cycle that started Dec 27 and open 1.3623, 61.8% of the Nov 1 - Dec 27 bear leg. Initial support is 1.3430, the 20-day EMA.

FIXED INCOME

BUND TECHS: (H4) Trend Needle Points South

• RES 4: 139.39 3.764 proj of the Nov of the 13 - 17 - 24 price swing
• RES 3: 137.96/138.84 High Jan 4 / High Dec 27 and the bull trigger
• RES 2: 136.16 High Jan 5 / 8
• RES 1: 135.02 20-day EMA
• PRICE: 133.76 @ 05:32 GMT Jan 25
• SUP 1: 133.58 Intraday low
• SUP 2: 133.42 Low Dec 4
• SUP 3: 132.89 50.0% retracement of the Oct 4 - Dec 27 bull phase
• SUP 4: 132.29 Low Nov 30

A clear downtrend in Bund futures remains intact and price is trading below both the 20- and 550-day EMAs. The recent move lower strengthens the current bear trend and maintains the price sequence of lower lows and lower highs. Key support at the Dec 8 low of 134.37, has recently been breached and this opens 133.42, the Dec 4 low. Initial resistance is at 135.02, the 20-day EMA. A clear break of the average would ease bearish pressure.

BOBL TECHS: (H4) Bear Trend Intact

• RES 4: 119.640 High Jan 4
• RES 3: 119.00 Round number resistance
• RES 2: 118.590 High Jan 12 and a key short-term resistance
• RES 1: 118.027 20-day EMA
• PRICE: 117.440 @ 05:44 GMT Jan 25
• SUP 1: 117.310 Low Jan 19
• SUP 2: 117.060 Low Dec 1
• SUP 3: 117.000 Round number support
• SUP 4: 116.830 Low Nov 29

A bearish cycle in Bobl futures remains intact and the contract is trading just above its recent lows. The recent breach of support at 117.800, the Dec 8 low, highlights potential continuation lower, exposing 117.060, the Dec 1 low, Note that the 50-day EMA has also been cleared, reinforcing a bearish theme. Key resistance and the bull trigger is 119.830, the Dec 27 high. Initial firm resistance to watch is 118.590, the Jan 12 high.

SCHATZ TECHS: (H4) Bearish Conditions Remain Intact

• RES 4: 106.640 High Dec 29 and the bull trigger
• RES 3: 106.360 Low Jan 3
• RES 2: 106.270 High Jan 5
• RES 1: 106.048 20-day EMA
• PRICE: 105.845 @ 06:02 GMT Jan 25
• SUP 1: 105.780 Low Dec 1 and Jan 19
• SUP 2: 105.730 Low Nov 30
• SUP 3: 105.660 High Nov 17
• SUP 4: 105.470 Low Nov 28

The downtrend in Schatz futures remains intact and the contract is trading closer to its recent lows. A key short-term support at 105.955, the Dec 13 low, has recently been cleared, strengthening a bearish theme. Sights are on 105.730 next, the Nov 30 low. Initial key resistance is 106.270, the Jan 5 / 12 high. A clear breach of this hurdle would ease bearish pressure and signal a reversal. First resistance is 106.048, the 20-day EMA.

GILT TECHS: (H4) Fresh Short-Term Trend Low

• RES 4: 101.98 High Jan 3
• RES 3: 100.81 High Jan 5
• RES 2: 100.00 Round number resistance
• RES 1: 99.67 20-day EMA
• PRICE: 98.12 @ Close Jan 24
• SUP 1: 97.81 Low Jan 24
• SUP 2: 97.39 Low Dec 11 and a key support
• SUP 3: 96.67 Low Dec 5
• SUP 4: 96.10 Low Nov 30

The trend needle in Gilt futures continues to point south and yesterday’s low print reinforces current conditions. The contract last week cleared support at 99.60, the Jan 5 low. This confirmed a resumption of the downtrend that started Dec 27, signalling scope for an extension towards 97.39, the Dec 11 low. Firm resistance to watch is 99.67, the 20-day EMA. A clear break of the average would ease bearish pressure.

BTP TECHS: (H4) Support Remains Exposed

• RES 4: 122.63 High Dec 7 2022 (cont)
• RES 3: 122.18 3.00 proj of the Nov 10 - 17 - 24 price swing
• RES 2: 121.43 2.764 proj of the Nov 10 - 17 - 24 price swing
• RES 1: 119.23/77 High Jan 12 / 4
• PRICE: 117.42 @ Close Jan 24
• SUP 1: 117.06 Low Jan 18
• SUP 2: 116.66 50-day EMA
• SUP 3: 115.18 Low Dec 4
• SUP 4: 114.10 50.0% retracement of the Oct 19 - Dec 27 bull cycle

A bearish corrective cycle in BTP futures remains in play. Price has recently traded below the 20-day EMA and last week’s move lower delivered a print below support at 117.24, the Jan 5 low. This opens the 50-day EMA at 116.66 - the next key support. Initial firm resistance has been defined at 119.23, the Jan 12 high. A reversal higher and a break of this level would highlight a base and a potential resumption of the primary uptrend.

EQUITIES

EUROSTOXX50 TECHS: (H4) Impulsive Rally

• RES 4: 4700.00 Round number resistance
• RES 3: 4662.90 1.236 projection of the Nov 8 - 24 - 28 price swing
• RES 2: 4636.70 76.4% retracement of the 2000 - 2009 downleg (cont)
• RES 1: 4600.00 High Jan 24
• PRICE: 4580 00 @ 06:16 GMT Jan 25
• SUP 1: 4498.90 20-day EMA
• SUP 2: 4402.00 Low Jan 17 and key short-term support
• SUP 3: 4370.00 Low Nov 28
• SUP 4: 4334.00 50.0% retracement of the Oct 27 - Dec 14 bull leg

Eurostoxx 50 futures have recovered from last week’s low of 4402.00 on Jan 17 and the contract traded sharply higher Wednesday. 4402.00 represents a key short-term support. A break of it would resume recent bearish pressure and open 4370.00, the Nov 28 low. On the upside, key resistance is at 4634.00, the Dec 14 high. Clearance of this level would confirm a resumption of the medium-term uptrend. Initial support lies at 4498.90, the 20-day EMA.

E-MINI S&P TECHS: (H4) Heading North

• RES 4: 5000.00 Psychological round number
• RES 3: 4982.62 1.50 proj of Nov 10 - Dec 1 - 7 price swing
• RES 2: 4952.45 1.382 proj of Nov 10 - Dec 1 - 7 price swing
• RES 1: 4931.25 High Jan 24
• PRICE: 4903.25 @ 07:16 GMT Jan 25
• SUP 1: 4804.36/4713.85 20- and 50-day EMA values
• SUP 2: 4702.00 Low Jan 5
• SUP 3: 4594.00 Low Nov 30
• SUP 4: 4550.75 Low Nov 16

The uptrend in S&P E-Minis remains intact and this week’s move higher reinforces current conditions. Resistance at 4841.50, the Dec 28 high has recently been cleared, confirming an extension of the price sequence of higher highs and higher lows. Moving average studies remain in a bull-mode condition, highlighting positive market sentiment. Sights are on 4952.45 next, a Fibonacci projection. Key support lies at 4721.08, the 50-day EMA.

COMMODITIES

BRENT TECHS: (H4) Watching Resistance

• RES 4: $86.50 - High Nov 3
• RES 3: $85.00 - Round number resistance
• RES 2: $84.22 - High Nov 30
• RES 1: $80.75/81.45 - High Jan 12 / High Dec 26 and key resistance
• PRICE: $80.33 @ 06:57 GMT Jan 25
• SUP 1: $74.79 - Low Jan 03
• SUP 2: $72.67/71.21 - Low Dec 13 and the bear trigger / Low Jun 23
• SUP 3: $69.25 - Low Mar 20 and a key support
• SUP 4: $67.84 - 1.236 proj of the Oct 20 - Nov 16 - 30 price swing

The trend outlook in Brent futures is unchanged and remains bearish despite recent gains. Resistance at the Jan 12 high of $80.75 is intact and price is also trading below a key short-term resistance at $81.45, the Dec 26 high. A resumption of bearish activity would open $74.79, the Jan 3 low, ahead of $72.67, the Dec 13 low and bear trigger. For bulls, clearance of $81.45 is required to signal a stronger reversal. This would open $84.22, Nov 30 high.

WTI TECHS: (H4) Approaching Resistance

• RES 4: $85.71 - High Oct 20
• RES 3: $82.04 - High Nov 3
• RES 2: $79.56 - High Nov 30 and a key short-term resistance
• RES 1: $76.31 - High Dec 26 and the bull trigger
• PRICE: $75.40 @ 07:13 GMT Jan 25
• SUP 1: $69.56 - Low Jan 03
• SUP 2: $68.28 - Low Dec 13 and the bear trigger
• SUP 3: $65.63 - Low Jun 12
• SUP 4: $63.00 - Low May 4 and a key support

Trend signals in WTI futures remain bearish and the latest recovery still appears to be a correction - for now. The contract has traded through the 50-day EMA at $74.28. This opens $76.31, the Dec 26 high and a near-term bull trigger. A break of this hurdle would undermine the bearish theme. Moving average studies continue to highlight a downtrend. The trigger for a resumption of the downtrend is $68.28, Dec 13 low.

GOLD TECHS: Bear Threat Still Present

• RES 4: $2135.4 - High Dec 4 and all-time high
• RES 3: $2097.1 - 76.4% retracement of the Dec 4 - 13 bear leg
• RES 2: $2062.3/2088.5 - High Jan 12 / High Dec 28
• RES 1: $2039.4 - High Jan 19
• PRICE: $2016.5 @ 07:17 GMT Jan 25
• SUP 1: $2001.9 - Low Jan 17
• SUP 2: $1973.2 - Low Dec 13 and key support
• SUP 3: $1931.7 - Low Nov 13
• SUP 4: $1908.3 - Low Oct 16

Gold remains above the Jan 17 low of $2001.9 - for now. The recent print below the 50-day EMA and the break of support at $2013.4, the Jan 11 low, has strengthened a bearish threat and a resumption of weakness would open a key level at $1973.2, the Dec 13 low. For bulls, clearance of 2062.3, the Jan 12 high, is required to signal a reversal. This would expose $2088.5, the Dec 28 high.

SILVER TECHS: Gains Considered Corrective

• RES 4: $26.135 - High May 5 and a key resistance
• RES 3: $25.761 - High Dec 4 and key resistance
• RES 2: $24.606/994 - High Dec 22 / 76.4% of Dec 4 - 13 bear leg
• RES 1: $23.534 - High Jan 12
• PRICE: $22.781 @ 07:40 GMT Jan 25
• SUP 1: $21.883 - Low Nov 13 and a key support
• SUP 2: $20.689 - Low Oct 3 and the bear trigger
• SUP 3: $19.904 - Low Mar 10 and a key support
• SUP 4: $19.904 - Low Mar 10 2023

A bearish theme in Silver remains intact and the latest recovery appears to be a correction. The recent breach of support at $22.510, the Dec 13 low, signals scope for a move to $21.883, the Nov 13 low. A break of this support would further strengthen the bearish theme. On the upside, key short-term resistance is at $24.606, the Dec 22 high. A move above this hurdle would reinstate a bullish theme. First resistance is $23.534, the Jan 12 high.