MNI DAILY TECHNICAL ANALYSIS - USD Ebbs to Monthly Lows

Price Signal Summary – USD Ebbs to Monthly Lows

• In the equity space, EUROSTOXX 50 futures recently cleared the 50-day EMA. The clear breach of this average and the recent break of a number of short-term resistance points has exposed 4200.50, the Sep 24 high. S&P E-minis recovered last week and price action on Oct 14 resulted in a move above the 50-day EMA - at 4393.95 today. 4472.00, Oct 7 high has been breached opening 4539.50, the Sep 3 high and bull trigger.
• In FX, EURUSD is trading higher today and has breached last week's highs. The pair has also moved above its 20-day EMA at 1.1625. The break of this average signals scope for a stronger short-term corrective bounce and potentially opens the 50-day EMA that intersects at 1.1704. GBPUSD is firmer today and the rally that started late September remains intact. The pair is trading above the 50-day EMA and this suggests scope for an extension to 1.3795 next, a Fibonacci retracement.
• On the commodity front, Gold failed to hold onto recent highs and Friday's sharp reversal lower highlights 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 confirmed an extension once again yesterday. The move to fresh highs maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend.
• In the FI space, the primary trend remains down and short-term gains are considered corrective. Bund futures remain above recent lows following the strong bounce last week from 168.21, Oct 12 low. Initial resistance is seen at 169.92, the Oct 14 high where a break would signal scope for a stronger short-term recovery. Gilt futures remain above recent lows. Recent gains are considered corrective and have allowed an oversold condition to unwind. Resistance is seen at the 20-day EMA that intersects at 125.29.

FOREIGN EXCHANGE

EURUSD TECHS: Trades Through The 20-Day EMA

• RES 4: 1.1821 High Sep 16
• RES 3: 1.1747/55 Bear channel from Jun 1 high / High Sep 22
• RES 2: 1.1704 50-day EMA
• RES 1: 1.1655 Intraday high
• PRICE: 1.1647 @ 06:09 BST Oct 19
• 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: 1.1412 Bear channel base drawn from the Jun 1 high

EURUSD is trading higher today and has breached last week's highs. The pair has also moved above its 20-day EMA at 1.1625. The break of this average signals scope for a stronger short-term corrective bounce and potentially opens the 50-day EMA that intersects at 1.1704. Broader trend conditions remain bearish though and a resumption of weakness would open the key support and bear trigger at 1.1524.

GBPUSD TECHS: Needle Still Points North

• RES 4: 1.3983 High Jul 30
• RES 3: 1.3913 High Sep 14 and a key resistance
• RES 2: 1.3854 High Sep 15
• RES 1: 1.3795 76.4% retracement of the Sep 14 -29 downleg
• PRICE: 1.3773 @ 06:21 BST Oct 19
• SUP 1: 1.3657 20-day EMA
• SUP 2: 1.3544/3412 Low Oct 6 / Low Sep 29 and the bear trigger
• SUP 3: 1.3371 2.0% 10-dma envelope
• SUP 4: 1.3354 Low Dec 23, 2020

GBPUSD is firmer today and the rally that started late September remains intact. The pair is trading above the 50-day EMA and this suggests scope for an extension to 1.3795 next, a Fibonacci retracement. A breach of this level would open 1.3913, the Sep 14 high. On the downside, a firm short-term support has been defined at 1.3544, Oct 6 low. A break would reinstate a bearish focus and open 1.3412, Sep 29 low and the bear trigger.

EURGBP TECHS: Remains Vulnerable

• RES 4: 0.8624/58 High Oct 1 / High Sep 29
• RES 3: 0.8537 50-day EMA
• RES 2: 0.8518 High Oct 12 and a firm resistance
• RES 1: 0.8487 High Oct 15
• PRICE: 0.8457 @ 06:27 BST Oct 19
• SUP 1: 0.8424 Low Oct 15
• SUP 2: 0.8400 1.0% 10-dma envelope
• SUP 3: 0.8356 Low Feb 26, 2020
• SUP 4: 0.8339 Low Feb 25, 2020

EURGBP remains vulnerable. The cross has recently cleared 0.8450, the Oct 10 low and a key support. This reinforces a bearish theme and paves the way for an extension lower, opening 0.8400 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. Firm resistance has been defined at 0.8518, Oct 12 high where a break is required to signal a short-term base.

USDJPY TECHS: Bulls Pause For Breath

• RES 4: 115.48 1.618 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 3: 115.17 2.0% 10-dma envelope
• RES 2: 114.99 1.50 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 1: 114.50 1.382 proj of Apr 23 - Jul 2 - Aug 4 price swing
• PRICE: 114.16 @ 06:37 BST Oct 19
• 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 is consolidating and remains firm. A strong bullish theme follows the break last week of a long-term trendline (at 113.41) drawn off the December 1975 high. This marks a potentially significant breach and reinforces both the short and medium-term bullish outlook. Attention is on a vol band resistance at 115.17. On the downside, initial firm support is seen at 112.08, Sep 30 high and a recent breakout level.

EURJPY TECHS: Still Climbing

• 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: 133.68 High Jun 15
• RES 1: 133.02 Intraday high
• PRICE: 132.97 @ 06:43 BST Oct 19
• SUP 1: 131.81/27 Low Oct 15 / Low Oct 14
• SUP 2: 130.75 Sep 3 high
• SUP 3: 130.04 50-day EMA
• SUP 4: 129.28 Low Oct 11

EURJPY maintains a bullish tone and is firmer today. The move higher confirms an extension of the upleg that started at 128.33, the Oct 6 low. The cross has recently cleared 130.75, Sep 3 high and a recent bull trigger. This strengthened the case for bulls and the breach of a number of key short-term resistance points above 130.75 reinforces the current positive outlook. The focus is on 133.68 next, Jun 15 high. Initial firm support is at 130.75.

AUDUSD TECHS: Approaching Key Resistance

• RES 4: 0.7599 High Jul 6
• RES 3: 0.7534 High Jul 7
• RES 2: 0.7503 High Jul 13
• RES 1: 0.7478 High Sep 3 and the bull trigger
• PRICE: 0.7463 @ 06:50 BST Oct 19
• SUP 1: 0.7339 50-day EMA
• SUP 2: 0.7288 Low Oct 8
• SUP 3: 0.7226/7170 Low Oct 6 / Low Sep 29
• SUP 4: 0.7106 Low Aug 20 key support

AUDUSD maintains a firmer short-term tone and has traded higher today. The pair remains above the 20- and 50-day EMAs. The recent break above these averages strengthened the short-term case for bulls and the focus is on 0.7478, Sep 3 high and a key short-term resistance. A breach of this hurdle would remove recent bearish considerations and set the scene for a continuation higher. Initial firm support is seen at 0.7339, the 50-day EMA.

USDCAD TECHS: Remains Weak

• RES 4: 1.2648 High Oct 6
• RES 3: 1.2568 50-day EMA
• RES 2: 1.2494 Low Sep 3 and a recent breakout level
• RES 1: 1.2449 High Oct 14
• PRICE: 1.2335 @ 06:55 BST Oct 19
• SUP 1: 1.2303 Low Jul 6
• 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

The USDCAD bear cycle that started Sep 20 remains in place. Key support at the Jul 30 low of 1.2422 has recently been cleared reinforcing bearish conditions and signalling scope for an extension of the downleg. This has opened 1.2303, Jul 6 low. Note too that moving average conditions appear to be turning bearish, reinforcing the current sentiment. Initial firm resistance is seen at 1.2494, Sep 3 low. A break would ease the current bearish pressure.

FIXED INCOME

BUND TECHS: (Z1) Resistance Still Intact

• RES 4: 171.72 High Sep 23
• RES 3: 170.85 50-day EMA
• RES 2: 170.55 High Oct 4 and key near-term resistance
• RES 1: 169.92 High Oct 14
• PRICE: 169.20 @ 05:17 BST Oct 19
• SUP 1: 168.64/21 Low Oct 13 / Low Oct 12 and the bear trigger
• 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 above recent lows following the strong bounce last week from 168.21, Oct 12 low. Initial resistance is seen at 169.92, the Oct 14 high where a break would signal scope for a stronger short-term recovery, towards 170.55, Oct 4 high. The broader trend condition remains bearish and moving average signals continue to point south. The trigger for a resumption of the downtrend is unchanged at 168.21.

BOBL TECHS: (Z1) Fresh Trend Low

• RES 4: 135.380 High Sep 23
• RES 4: 135.200 Low Sep 17 and recent breakout level / High Oct 4
• RES 3: 135.060 High Oct 7
• RES 2: 134.887 20-day EMA
• PRICE: 134.320 @ 05:21 BST Oct 19
• SUP 1: 134.200 Low Oct 18
• SUP 2: 134.136 1.382 proj of the Sep 21 - 28 - Oct 4 price swing
• SUP 3: 134.070 Low Jul 6 (cont)
• SUP 4: 134.000 Round number support

Bobl futures started the week on a softer note and traded to a fresh trend low yesterday. This has once again confirmed a resumption of the underlying downtrend and reinforces bearish conditions. Resistance is seen at 134.887, the 20-day EMA and a breach of this level is required to signal scope for a stronger bounce towards 135.060, the Oct 7 high. For bears, the focus is on 134.136, a Fibonacci projection.

SCHATZ TECHS: (Z1) Resumes Its Downtrend

• 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: 112.135 Low Oct 13 and yesterday's breakout level
• PRICE: 112.070 @ 05:30 BST Oct 19
• SUP 1: 112.045 Low Oct 18
• SUP 2: 112.025 2.00 proj of the Sep 20 - 28 - Oct 5 price swing
• 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 and yesterday's sharp move lower reinforces this condition. The break to fresh trend lows confirms a resumption of the downtrend, signalling scope for a continuation lower. The focus is on 112.025 next, a Fibonacci projection. On the upside, initial resistance is at 112.135, Oct 13 low and yesterday's breakout level.

GILT TECHS: (Z1) Support Remains Exposed

• RES 4: 126.84 Low Sep 17
• RES 3: 126.44 High Sep 24
• RES 2: 125.72 High Oct 1
• RES 1: 125.29 20-day EMA
• PRICE: 124.31 @ Close Oct 18
• SUP 1: 123.89/123.44 Low Oct 18 / 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 have allowed an oversold condition to unwind. Resistance is seen at the 20-day EMA that intersects at 125.29. A break of this resistance area would signal scope for a stronger recovery. The broader trend direction remains down and a resumption of weakness would refocus attention on last week's low of 123.44, the bear trigger.

BTP TECHS: (Z1) Trend Condition Remains Bearish

• 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 / High Oct 1
• PRICE: 151.60 @ Close Oct 18
• SUP 1: 150.81 Low Oct 18
• 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 yesterday before finding support. 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 are in a bear mode condition, reinforcing the current trend direction.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Resistance Remains Exposed

• 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: 4146.50 @ 05:57 BST Oct 19
• SUP 1: 4096.60 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 holding onto the bulk of recent gains. Price action has recently cleared the 50-day EMA. The clear breach of this average and the recent break of a number of short-term 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 4096.60 today, marks initial support.

E-MINI S&P (Z1): Extends Gains

• RES 4: 4591.25 1.00 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 1: 4539.50 High Sep 3 and the bull trigger
• RES 3: 4519.75 High Sep 9
• RES 1: 4509.25 High Sep 10
• PRICE: 4481.00 @ 07:01 BST Oct 19
• SUP 1: 439.95 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 recovered last week and price action on Oct 14 resulted in a move above the 50-day EMA - at 4393.95 today. A clear breach of the average has strengthened the case for bulls and this week's positive price action reinforces current short-term conditions. 4472.00, Oct 7 high has been breached opening 4539.50, the Sep 3 high and bull trigger. Initial key support is at 4317.25, Oct 12 low. The 50-day EMA is first support.

COMMODITIES

BRENT TECHS: (Z1) Uptrend Remains Intact

• 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: $86.04 - High Oct 18
• PRICE: $84.72 @ 07:03 BST Oct 19
• SUP 1: $82.20/80.68 - Low Oct 13 / 20-day EMA
• SUP 2: $79.08/78.75 - Low Oct 7 and key support / Low Oct 4
• SUP 3: $76.51/75.42 - Low Sep 30 and key support / High Sep 15
• SUP 4: $74.81 - Low Sep 23

The current bull trend in Brent futures remains intact and a fresh high print was registered yesterday. The move higher marks a resumption of the uptrend and maintains the bullish price sequence of higher highs and higher lows. Note too that the contract has 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 $82.20, Oct 13 low.

WTI TECHS: (X1) Still Heading North

• RES 4: 487.05 - 2.236 proj of the Aug 23 - Sep 2 - Sep 9 price swing
• RES 3: $84.97 - 2.00 proj of the Aug 23 - Sep 2 - Sep 9 price swing
• RES 2: $84.00 - Round number resistance
• RES 1: $83.87 - High Oct 18
• PRICE: $82.91 @ 07:06 BST Oct 19
• SUP 1: $79.42 - Low Oct 13
• SUP 2: $77.27 - 20-day EMA
• SUP 3: $74.96 - Low Oct 7 and key near-term support
• SUP 4: $73.14 - Low Sep 30 and key support

WTI trend conditions remain bullish and the contract confirmed an extension once again yesterday. The move to fresh highs maintains the bullish price sequence of higher highs and higher lows, reinforcing the uptrend. Note that the $80.00 psychological hurdle has also been cleared. The focus is on $84.97 next, a Fibonacci projection. On the downside, key short-term support has been defined at $79.42, Oct 13 low.

GOLD TECHS: Remains Below Recent Highs

• 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: $1776.6 @ 07:23 BST Oct 19
• 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 failed to hold onto recent highs and Friday's sharp reversal lower highlights 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 is required to reinstate the recent bullish theme.

SILVER TECHS: Holding Onto Recent Gains

• RES 4: $25.206 - High Jun 8
• RES 3: $24.867 - High Sep 3 and the reversal trigger
• RES 2: $24.411 - High Sep 8
• RES 1: $23.965 - High Sep 16
• PRICE: $23.569 @ 07:26 BST Oct 19
• SUP 1: $22.213 - Low Oct 6
• SUP 2: $21.423 - Low Sep 29
• SUP 3 : $20.871 - 50.0% retracement of the Mar '20 - Feb '21 rally
• SUP 4: $19.851 - Low Jul 21, 2020

Silver is trading near recent highs. Last week the metal cleared the 20-day EMA and the metal has also traded above the 50-day EMA. A continuation would pave the way for a stronger short-term recovery and open $23.965 next, the Sep 16 high. Clearance of this level would suggest potential for stronger gains towards $24.867, Sep 3 high. This also marks a key short-term resistance. Initial firm support to watch is at $22.213, Oct 6 low.