MNI DAILY TECHNICAL ANALYSIS - USD Index Remains Above 104.00

Price Signal Summary - USD Index Remains Above 104.00

• In the equity space, S&P E-Minis remain vulnerable and short-term gains are considered corrective. Last week’s continuation lower and fresh cycle lows, reinforces the primary bearish trend condition and signals scope for an extension lower. The next objective is 3843.25, the Mar 25 2021 low (cont). Initial firm resistance is at 4099.00, the May 9 high. EUROSTOXX 50 futures outlook remains bearish and short-term gains are also considered corrective. Recent weakness has resulted in a breach of support at 3608.00, Apr 27 low and of 3551.60, 61.8% retracement of the Mar 7 - 29 rally. This has exposed 3458.90 next, the 76.4% retracement. Initial resistance is at 3743.6, the 50-day EMA.
• In FX, EURUSD traded lower last Thursday and cleared support at 1.0472, Apr 28 low. The breach confirms a bear flag breakout and a resumption of the primary downtrend. The focus is on 1.0341, the Jan 3 2017 low and a key support. GBPUSD remains weak following last week’s extension of the downtrend. The focus is on 1.2162 next, the May 22 2020 low. The USDJPY primary uptrend remains intact and last week’s move lower is likely a correction. Initial support has been defined at 127.52, Thursday’s low. A resumption of gains would refocus attention on the bull trigger at 131.35, May 9 high. A break would open 131.96, the 1.00 projection of the Feb 24 - Mar 28 - 31 price swing. The USD Index (DXY) is trading above 104.00. This signals a potential break of the multi year range resistance and reinforces the current bullish USD theme
• On the commodity front, Gold remains vulnerable following last week’s resumption of the downtrend. The yellow metal has started the week on a softer note, trading through the $1800.0 handle. The focus is on $1780.4, the Jan 28 low. In the Oil space, a bearish threat in WTI futures remains present, despite the recovery from last Wednesday’s low of $98.20 low. Key short-term resistance is at $111.37, the May 5 high. This level has been probed but a clear break is required to suggest scope for a stronger bounce. Today’s high so far is $111.71. $98.20, May 11 low, is a key support.
• In the FI, Bund futures remain in a downtrend and last week’s gains are considered corrective. A fresh cycle low on May 9 reinforced the bearish condition. A resumption of weakness would refocus attention on 150.49, the bear trigger. Firm trend resistance is 156.00, the Apr 28 high. The broader trend condition in Gilts remains down. However, Thursday’s move higher resulted in a break of resistance at 119.79, the Apr 25 high. This signals potential for a stronger short-term corrective phase and opens 121.84 next, 50.0% of the Mar 1 - May 9 bear leg. On the downside, key support has been defined at 116.87, the May 9 low. This is also the bear trigger.

FOREIGN EXCHANGE

EURUSD TECHS: Trend Needle Points South

• RES 4: 1.0852 High Apr 22
• RES 3: 1.0758 Low Apr 14 and a recent breakout level
• RES 2: 1.0642 High May 5 and key short-term resistance
• RES 1: 1.0529/0598 High May 12 / 20-day EMA
• PRICE: 1.0403 @ 06:08 BST May 16
• SUP 1: 1.0350 Low May 13
• SUP 2: 1.0341 Low Jan 3 2017 and a key support
• SUP 3: 1.0333 1.236 proj of the Feb 10 - Mar 7 - 31 price swing
• SUP 4: 1.0304 2.0% 10-dma envelope

EURUSD traded to a fresh cycle low Friday reinforcing current bearish conditions. The pair cleared support at 1.0472 last week, the Apr 28 low. This confirmed a bear flag breakout and a resumption of the primary downtrend. Moving average studies remain in a bear mode condition, highlighting current sentiment. The focus is on 1.0341 next, the Jan 3 2017 low and key support. Key short-term resistance has been defined at 1.0642.

GBPUSD TECHS: Downtrend Intact

• RES 4: 1.2832 50-day EMA
• RES 3: 1.2772 High Apr 26
• RES 2: 1.2638 High May 4 and a key resistance
• RES 1: 1.2406/2533 High May 9 / 20-day EMA
• PRICE: 1.2246 @ 06:15 BST May 16
• SUP 1: 1.2156 Low May 13
• SUP 2: 1.2081 76.4% retracement of the Mar ‘20 - Jun ‘21 uptrend
• SUP 3: 1.2000 psychological round number
• SUP 4: 1.1903 1.00 proj of the Apr 14 - 28 - May 4 price swing

GBPUSD remains bearish and short-term gains are considered corrective. Recent fresh cycle lows mark an extension of the sharp sell-off on May 5, that confirmed a resumption of the downtrend. This maintains the bearish price sequence of lower lows and lower highs and note that MA studies are in a bear mode condition. The focus is on 1.2081 next, the 76.4% retracement of the Mar ‘20 - Jun ‘21 uptrend. Initial firm resistance is at 1.2406, high May 9.

EURGBP TECHS: Pullback Considered Corrective

• RES 4: 0.8670 High Jul 20 2021
• RES 3: 0.8658/71 High Sep 29 2021 / 2.0% 10-dma envelope
• RES 2: 0.8643 High Sep 30 2021
• RES 1: 0.8619 High May 12
• PRICE: 0.8497 @ 06:21 BST May 16
• SUP 1: 0.8468 High Apr 27 and a recent breakout level
• SUP 2: 0.8413 50-day EMA
• SUP 3: 0.8367 Low May 2
• SUP 4: 0.8313 Low Apr 22

EURGBP remains below its recent highs following a reversal on May 12. The short-term pullback is considered corrective and the trend condition remains bullish. A resumption of strength would open 0.8624, the Oct 1 2021 high and 0.8671, the top of a moving average envelope. Initial firm support is seen at 0.8468, the Apr 27 high and breakout level. A break would expose the 50-day EMA, at 0.8413 today.

USDJPY TECHS: Remains Above Last Thursday’s Low

• RES 4: 133.11 High Apr 4 2002
• RES 3: 132.39 High Apr 15 2002
• RES 2: 131.96 1.00 proj of the Feb 24 - Mar 28 - 31 price swing
• RES 1: 130.05/131.35 High May 12 / High May 9 and the bull trigger
• PRICE: 128.87 @ 06:29 BST May 16
• SUP 1: 127.52 Low May 12
• SUP 2: 126.95 Low Apr 27 and a key support
• SUP 3: 125.09 Low Apr 14
• SUP 4: 124.01 Low Apr 11

The USDJPY outlook is bullish and the pair remains above last Thursday’s low of 127.52. This level represents the first key support. A resumption of gains and a break above 131.35, May 9 high, would clear the path for 131.96, a Fibonacci projection. A move higher would also maintain a bullish price sequence of higher highs and higher lows and confirm a resumption of the downtrend. Key trend support is unchanged at 126.95, Apr 27 low.

EURJPY TECHS: Trading Closer To Its Recent Low

• RES 4: 141.06 High Jun 4 2015 and a key resistance
• RES 3: 140.87 0.50 proj of the Mar 7 - 28 - Apr 5 price swing
• RES 2: 138.32/140.00 High May 9 / High Apr 21 and the bull trigger
• RES 1: 134.97/136.75 50-day EMA / High May 12
• PRICE: 134.21 @ 06:50 BST May 16
• SUP 1: 132.66/42 Low May 12 / 3.0% 10-dma envelope
• SUP 2: 132.36 100-dma
• SUP 3: 132.20 50% retracement of the Mar 7 - Apr 21 bull phase
• SUP 4: 131.59 Low Mar 22

EURJPY fell sharply on May 12 and remains vulnerable near-term. The move lower last week marks an extension of the reversal from Apr 21. The cross has breached a number of important S/T support levels, clearing the 50-day EMA, and the Apr 5 low of 134.30. An extension lower would signal scope for a deeper retracement towards 132.36 initially - the 100-dma, before the 50% retracement of the Mar 7 - Apr 21 comes into play. Initial resistance is 136.75.

AUDUSD TECHS: Maintains A Bearish Tone

• RES 4: 0.7266 High May 4/5 and a bull trigger
• RES 3: 0.7219 50-day EMA
• RES 2: 0.7135 Low May 6
• RES 1: 0.6953/7054 High May 12 / High May 11 and key resistance
• PRICE: 0.6886 @ 06:55 BST May 16
• SUP 1: 0.6829 Low May 12
• SUP 2: 0.6805 Low Jun 22 2020
• SUP 3: 0.6784 0.764 proj of the Apr 5 - May 2 - 4 price swing
• SUP 4: 0.6759 50.0% retracement of the Mar ‘20 - Feb ‘21 upleg

AUDUSD maintains a bearish tone having resumed its downtrend last week. The move lower marked an extension of the reversal last week from 0.7266, the May 4/5 high. Moving average studies are in bear mode condition, highlighting current sentiment. Support at 0.6968, the Jan 28 low and a bear trigger, has been breached. This opens 0.6805 next, the Jun 22 2020 low. Initial firm resistance is at last Wednesday’s high of 0.7054.

USDCAD TECHS: Corrective Pullback

• RES 4: 1.3177 2.0% 10-dma envelope
• RES 3: 1.3173 High Nov 13 2020
• RES 2: 1.3091 High Nov 24 2020
• RES 1: 1.3077 High May 12
• PRICE: 1.2966 @ 07:04 BST May 16
• SUP 1: 1.2842/2814 20-day EMA / Low May 6
• SUP 2: 1.2745/14 50-day EMA / Low May 5 and a key support
• SUP 3: 1.2568 Low Apr 22
• SUP 4: 1.2459 Low Apr 21

USDCAD remains below last week’s high of 1.3077. A pullback is considered corrective and the outlook is bullish. Recent gains resulted in a breach of 1.2914, May 2 high, and key resistance at 1.2964, the Dec 20 2021 high. The break of the latter marks an important M/T bullish development and reinforces the positive outlook. This has opened 1.3177 next, the upper band of a MA envelope. Initial support is at 1.2914. Key support is at 1.2714, Apr 29 low.

FIXED INCOME

BUND TECHS: (M2) Primary Trend Remains Down

• RES 4: 157.87 High Apr 7
• RES 3: 156.93 50-day EMA
• RES 2: 156.00 High Apr 28 and a key short-term resistance
• RES 1: 155.33 High May 12
• PRICE: 154.07 @ 05:02 BST May 16
• SUP 1: 151.87/150.49 Low May 11 / Low May 9
• SUP 2: 150.15 0.764 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 3: 150.00 Psychological round number
• SUP 4: 149.49 Low Jul 13 2015 (cont)

Broader trend signals in Bund futures are unchanged and the primary direction remains down. Last week’s gains are considered corrective. A fresh cycle low on May 9 reinforced the bearish condition and confirmed, once again, an extension of the price sequence of lower lows and lower highs. MA studies remain in a bear mode. A resumption of weakness would refocus attention on 150.49, the bear trigger. Firm trend resistance is 156.00.

BOBL TECHS: (M2) Corrective Cycle Still In Play

• RES 4: 129.350 High Apr 4 and a reversal point
• RES 3: 128.830 High Apr 7
• RES 2: 128.650 50-day EMA
• RES 1: 128.380 High May 12
• PRICE: 127.930 @ 05:05 BST May 16
• SUP 1: 126.770/126.010 Low May 11 / Low May 6 and a bear trigger
• SUP 2: 126.00 Round number support
• SUP 3: 125.450 0.618 proj of the Mar 7 - 29 - Apr 4 price swing
• SUP 4: 125.260 Low Apr 24 20014 (cont)

Bobl futures continue to trade above recent lows and the contract is holding onto the bulk of last week’s gains. Price remains above the 20-day EMA and has recently probed resistance at 128.650, the Apr 14/28 high. A continuation higher would signal scope for a test of the 50-day EMA at 128.686. Gains are considered corrective and the primary trend direction remains down. A resumption of weakness would refocus attention on key support at 126.010.

SCHATZ TECHS: (M2) Remains Above Its 20-Day EMA

• RES 4: 111.000 Round number resistance
• RES 3: 110.855 High Apr 4
• RES 2: 110.706 50-day EMA
• RES 1: 110.690 High MAy 13
• PRICE: 110.550 @ 05:07 BST May 16
• SUP 1: 110.210/109.980 Low May 10 / Low May 6 and bear trigger
• SUP 2: 109.777 0.618 proj of the Mar 7 - 30 - Apr 4 price swing
• SUP 3: 109.555 Low Oct 31 2011 (cont)
• SUP 4: 109.340 Low Oct 28 011 (cont)

The primary trend direction in Schatz futures remains down and recent short-term gains are considered corrective. The contract remains above its 20-day EMA and the extension higher last week resulted in a break of 110.540, the Apr 28 high and a key resistance. This opens 110.706 next, the 50-day EMA. A turn lower would refocus attention on the bear trigger at 109.980, May 6 low. A break would resume the downtrend.

GILT TECHS: (M2) Corrective Cycle Likely To Extend

• RES 4: 122.72 High Mar 18
• RES 3: 122.35 High Apr 4
• RES 2: 121.84 50.0% retracement of the Mar 1 - May 9 bear leg
• RES 1: 121.07 High May 12
• PRICE: 120.24 @ Close May 13
• SUP 1: 119.11 20-day EMA
• SUP 2: 118.25/116.87 Low May 11 / Low May 9 and the bear trigger
• SUP 3: 116.35 Low Dec 30 2015 (cont)
• SUP 4: 115.40 1.00 proj of the Mar 1 - 28 - Apr 4 price swing

The trend direction in Gilt futures remains down and last week’s climb is considered corrective. Thursday’s move higher however resulted in a break of resistance at 119.79, the Apr 25 high. This signals potential for a stronger short-term corrective phase and opens 121.84 next, a Fibonacci retracement. On the downside, key support has been defined at 116.87, the May 9 low. This level also represents the bear trigger.

BTP TECHS: (M2) Scope For A Stronger Corrective Bounce

• RES 4: 135.23 High Apr 14
• RES 3: 134.36 50-day EMA
• RES 2: 133.53 High Apr 28
• RES 1: 131.24 High May 12
• PRICE: 129.68 @ Close May 13
• SUP 1: 127.24/125.54 Low May 11 / Low May 9 and the bear trigger
• SUP 2: 125.02 1.236 proj of the Mar 1 - 29 - 31 price swing
• SUP 3: 124.02 Low Mar 18 2020 (cont) and a major support
• SUP 4: 123.41 1.382 proj of the of the Mar 1 - 29 - 31 price swing

The trend condition in BTP futures is unchanged and the primary direction remains down. Over the short-term however, a corrective (bullish) cycle has been established and the contract has traded above a trendline resistance drawn from the Mar 1 high. Price has also breached its 20-day EMA. This signals scope for a move towards 133.53, Apr 28 high. Key support has been defined at 125.54, the May 9 low and bear trigger.

EQUITIES

EUROSTOXX50 TECHS: (M2) Gains Still Considered Corrective

• RES 4: 3944.00 High Mar 29 and a key resistance
• RES 3: 3883.00 High Apr 21
• RES 2: 3775.00 High May 5
• RES 1: 3743.60 50-day EMA
• PRICE: 3670.00 @ 05:40 BST May 16
• SUP 1: 3466.00 Low May 10 and the bear trigger
• SUP 2: 3458.90 76.4% retracement of the Mar 7 - 29 rally
• SUP 3: 3400.00 Round number support
• SUP 4: 3309.00 Low Mar 7 and a major support

EUROSTOXX 50 futures remain in a bear mode and last week’s recovery is still considered corrective. The contract has recently cleared support at 3608.00, Apr 27 low. This highlighted a resumption of the current bear cycle. And opens 3458.90, a Fibonacci retracement. A break of this level would clear the path for 3309.00, Mar 7 low and a major support. Firm resistance has been defined at 3775.00, May 5 high. A break would alter the picture.

E-MINI S&P (M2): Bears Pause For Breath

• RES 4: 4509.00 High Apr 21
• RES 3: 4393.25 High Apr 22
• RES 2: 4303.50 High Apr 26/28 and a key short-term resistance
• RES 1: 4099.00/4287.01 High May 9 / 50-day EMA
• PRICE: 4000.50 @ 06:56 BST May 16
• SUP 1: 3855.00/3843.25 Low May 12 / Low Mar 25 2021 (cont)
• SUP 2: 3820.25 2.50 proj of the Mar 29 - Apr 18 - 21 price swing
• SUP 3: 3787.74 2.618 proj of the Mar 29 - Apr 18 - 21 price swing
• SUP 4: 3747.52 2.764 proj of the Mar 29 - Apr 18 - 21 price swing

S&P E-Minis remain vulnerable and short-term gains are considered corrective. Last week’s continuation lower and fresh cycle lows, reinforces the primary bearish trend condition and signals scope for a continuation lower. The next objective is 3843.25, the Mar 25 2021 low (cont). In terms of resistance, the key short-term level is at 4303.50, the Apr 26/28 high. Initial resistance is at 4099.00, the May 9 high.

COMMODITIES

BRENT TECHS: (N2) Key S/T Resistance Remains Intact

• RES 4: $123.44 - High Mar 8
• RES 3: $121.13 - 76.4% retracement of the Mar 7 - 15 downleg
• RES 2: $115.76 - High Mar 24 and a bull trigger
• RES 1: $114.00 - High May 5 and key near-term resistance
• PRICE: $109.62 @ 07:03 BST May 16
• SUP 1: $107.20/101.30 - 200-day EMA / Low May 11
• SUP 2: $99.25 - Low Apr 25 and a key near-term support
• SUP 3: $97.18 - Low Apr 11
• SUP 4: $92.59 - Low Mar 15 and a bear trigger

The Brent futures outlook remains bearish, despite the recovery from last Wednesday’s $101.30 low. The contract continues to trade below its recent high of $114.00, on May 5. This level represents a key short-term resistance where a break is required to signal scope for a stronger bounce. A reversal lower would refocus attention on support at $101.30 - the trigger for a deeper pullback.

WTI TECHS: (M2) Challenging Resistance

• RES 4: $119.95 - High Mar 8
• RES 3: $118.13 - High Mar 9
• RES 2: $113.51/113.90 - High Mar 24 / 76.4% of Mar 7 - 15 downleg
• RES 1: $111.37/71 - High May 5 / Intraday high
• PRICE: $108.85 @ 07:14 BST May 16
• SUP 1: $101.06/98.20 - 50-day EMA / Low May 11
• SUP 2: $95.28 - Low Apr 25 and a key near-term support
• SUP 3: $92.60 - Low Apr 11 and a key support
• SUP 4: $90.37 - Low Mar 15 and a bear trigger

A bearish threat in WTI futures remains present, despite the recovery from last Wednesday’s low of $98.20. Key short-term resistance has been defined at $111.37, the May 5 high, has been probed. A clear break however would alter the picture and instead signal scope for a stronger recovery. This would open $113.51, the Mar 24 high. On the downside, the key support to watch lies at $98.20. A break of this level would strengthen bearish conditions.

GOLD TECHS: Trades Through $1800.0

• RES 4: $1919.9 - High Apr 29 and key resistance
• RES 3: $1909.8 - High May 5
• RES 2: $1878.6 - 20-day EMA
• RES 1: $1858.8 - High May 12
• PRICE: $1799.20 @ 09:50 BST May 16
• SUP 1: $1787.0 - Intraday low
• SUP 2: $1780.4 - Low Jan 28 and a key support
• SUP 3: $1753.7 - Low Dec 15 2021
• SUP 4: $1749.3 - 1.236 proj of the Mar 8 - 29 - Apr 18 price swing

Gold remains vulnerable and traded lower Friday. The yellow metal has traded through the $1800.0 handle. A clear break of this support would set the scene for an extension lower towards the next key support at $1784.4, the Jan 28 low. Last week’s breach of $1848.8, 76.4% of the Jan 28 - Mar 8 rally, confirmed a resumption of the downtrend. Initial resistance has been defined at $1858.8, the May 12 high ahead of the 20-day EMA at $1878.6.

SILVER TECHS: Southbound

• RES 4: $26.943 - High Mar 8 and the bull trigger
• RES 3: $26.222 - High Apr 18 and a key short-term resistance
• RES 2: $25.293 - High Apr 20
• RES 1: $22.698/23.622 - 20-day EMA / 50-day EMA
• PRICE: $21.045 @ 08:01 BST May 16
• SUP 1: $20.464 - Low May 13
• SUP 2: $20.282 - 2.00 proj of the Mar 8 - 29 - Apr 18 price swing
• SUP 3: $20.000 - Psychological round number
• SUP 4: $19.581 - 2.236 proj of the Mar 8 - 29 - Apr 18 price swing

Silver remains bearish and traded lower again Friday. Support at $22.008, the Feb 3 low and a bear trigger, was breached last week. The move lower reinforced the bearish theme and also resulted in a break of $21.427/423, the Dec 15 2021 low and Sep 29 2021 low. Sights are on $20.000 next. Firm short-term resistance is at $22.698, the 20-day EMA.