MNI DAILY TECHNICAL ANALYSIS - USD/JPY Pause Appears to Be a Bull Flag Formation

Price Signal Summary – USD/JPY Pause Appears to Be a Bull Flag Formation

• The trend condition in S&P E-Minis remains bullish and the latest move lower appears to be a correction. Price action continues to highlight the fact that corrections are shallow - this is a bullish signal that highlights positive market sentiment. A bullish theme in Eurostoxx 50 futures remains intact and Monday’s fresh cycle high reinforces this theme. Moving average studies remain in a bull-mode position and this set-up highlights positive market sentiment.
• EURUSD is holding on to its recent gains but -for now - remains below the Feb 22 high. The pair has breached the 50-day EMA - at 1.0836. A clear break of it would highlight a stronger reversal. 1.0888, the Feb 22 high also represents an important resistance. The USDJPY trend condition remains bullish and the recent pause appears to be a bull flag formation - a continuation pattern. This reinforces bullish conditions and sights are on 151.91/95, the Nov 13 ‘23 high and the Oct 1 ‘22 high and major resistance. AUDUSD initially traded lower Tuesday, before reverting back to flat ahead of the close. The print yesterday through last week’s lows, reinforces a bearish theme and signals scope for an extension towards the bear trigger at 0.6443, the Feb 13 low.
• Gold remains firm on the back of the latest rally. The yellow metal yesterday traded above resistance at $2135.4, the Dec 4 high to deliver a fresh all-time cycle high. The break reinforces bullish conditions and signals scope for a climb towards $2177.6 next. The WTI futures trend condition remains bullish and last week’s break of key resistance at $79.09, the Jan 29 high, reinforces this theme. The clear breach of this hurdle highlights potential for a continuation towards $81.70, a Fibonacci retracement.
• Bund futures traded higher Tuesday and in the process, the contract pierced 133.27, the 50-day EMA. A clear break of this average would signal scope for an extension and open 134.18, the Feb 15 high. Note that a break higher would also result in a bear channel breakout. Gilt futures traded sharply higher Tuesday, extending the recovery from last week’s low. Resistance at 98.53, the Feb 26 high, has been cleared. The break eases recent bearish pressure and instead signals scope for a continuation higher near-term.

EURUSD TECHS: Watching Resistance

• RES 4: 1.1046 High Jan 2
• RES 3: 1.0998 High Jan 5
• RES 2: 1.0932 High Jan 24
• RES 1: 1.0888/98 High Feb 22 and a key resistance / High Feb 02
• PRICE: 1.0856 @ 05:48 GMT Mar 6
• SUP 1: 1.0796 Low Feb 29
• SUP 2: 1.0762/0695 Low Feb 20 / 14 and the bear trigger
• SUP 3: 1.0656 Low Nov 10
• SUP 4: 1.0611 76.4% retracement of the Oct - Dec bull leg

EURUSD is holding on to its recent gains but -for now - remains below the Feb 22 high. The pair has breached the 50-day EMA - at 1.0836. A clear break of it would highlight a stronger reversal. 1.0888, the Feb 22 high also represents an important resistance. A breach would open 1.0932, Jan 24 high. For bears, the shooting star pattern on Feb 22 continues to highlight a possible reversal. A stronger move lower would expose 1.0695, Feb 14 low.

GBPUSD TECHS: Holding On To Its Recent Gains

• RES 4: 1.2881 76.4% retracement of the Jul 14 - Oct 4 bear leg
• RES 3: 1.2827 High Dec 28 and the bull trigger
• RES 2: 1.2775 High Jan 24
• RES 1: 1.2735 High Mar 05
• PRICE: 1.2705 @ 06:25 GMT Mar 6
• SUP 1: 1.2600 Low Mar 1
• SUP 2: 1.2519 Low Feb 5 and the bear trigger
• SUP 3: 1.2500 Low Dec 13
• SUP 4: 1.2432 50.0% retracement of the Oct 4 - Dec 28 bull phase

GBPUSD traded higher again Tuesday and is holding on to its recent gains. This has exposed resistance at 1.2775, the Jan 24 high, where a break would signal scope for a climb towards the key resistance and bull trigger at 1.2827, the Dec 28 high. For bears, a reversal lower and a breach of 1.2600, the Mar 1 low, is required to once again highlight a bearish threat. This would expose the bear trigger at 1.2519, the Feb 5 low.

EURGBP TECHS: Key Short-Term Resistance Remains Intact

• RES 4: 0.8676 High Jan 3
• RES 3: 0.8620 High Jan 20
• RES 2: 0.8593 High Jan 19
• RES 1: 0.8578 High Feb 20 and key short-term resistance
• PRICE: 0.8545 @ 06:35 GMT Mar 6
• SUP 1: 0.8528 Low Feb 23
• SUP 2: 0.8493 Low Aug 23 2023 and a key medium-term support
• SUP 3: 0.8454 76.4% of the Mar 7 - Sep 26 ‘23 bull phase
• SUP 4: 0.8388 Low Aug 17 2023

EURGBP remains below key resistance at 0.8578, the Feb 20 high. Moving average studies continue to highlight a downtrend, however, a break of 0.8578 would highlight a bullish development. The cross has pulled back from its recent highs, a deeper retracement would expose support and the bear trigger at 0.8493, Aug 23 low. Clearance of this level would confirm a resumption of the trend and open 0.8454, a Fibonacci retracement.

USDJPY TECHS: Bull Flag Formation

• RES 4: 152.43 0.764 proj of the Dec 28 - Jan 19 - Feb 1 price swing
• RES 3: 151.91/95 High Nov 13 / High Oct 1 ‘22 and major resistance
• RES 2: 151.43 High Nov 16
• RES 1: 150.89 High Feb 13 and bull trigger
• PRICE: 149.88 @ 06:53 GMT Mar 6
• SUP 1: 149.21/148.51 Low Feb 29 / 50-day EMA
• SUP 2: 147.63 Low Feb 7
• SUP 3: 145.90 Low Feb 1 and key support
• SUP 4: 145.59 Low Jan 16

The USDJPY trend condition remains bullish and the recent pause appears to be a bull flag formation - a continuation pattern. This reinforces bullish conditions and sights are on 151.91/95, the Nov 13 ‘23 high and the Oct 1 ‘22 high and major resistance. The bull trigger is 150.89, Feb 13 high. Initial support lies at 149.21, the Feb 29 low, ahead of the 50-day EMA, at 148.51. A clear of the average is required to signal a top.

EURJPY TECHS: Outlook Remains Bullish

• RES 4: 166.46 1.236 proj of the Jan 2 - 19 - Feb 1 price swing
• RES 3: 165.00 Round number resistance
• RES 2: 164.30 High Nov 16 and a key medium-term resistance
• RES 1: 163.72 High Nov 27 and Feb 26
• PRICE: 162.66 @ 07:04 GMT Mar 6
• SUP 1: 162.15 20-day EMA
• SUP 2: 160.93 50-day EMA
• SUP 3: 160.09 Trendline support drawn from the Dec 7 low.
• SUP 4: 158.92 Low Feb 7

The trend condition in EURJPY is unchanged and bulls remain in the driver’s seat. Support to watch lies at 162.15, the 20-day EMA. It has recently been pierced. A clear break of the average would signal scope for a deeper pullback towards the 50-day EMA, at 160.93. With a bull cycle still in play, attention is on resistance at 163.72, the Nov 27 high (tested) ahead of key resistance at 164.30, the Nov 16 high.

AUDUSD TECHS: Bearish Outlook

• RES 4: 0.6729/71 High Jan 12 / 3
• RES 3: 0.6663 High Jan 16
• RES 2: 0.6595/6625 High Feb 22 and key resistance / High Jan 30
• RES 1: 0.6561 50-day EMA
• PRICE: 0.6520 @ 07:56 GMT Mar 6
• SUP 1: 0.6478/6443 Low Mar 5 / Low Feb 13 and the bear trigger
• SUP 2: 0.6412 76.4% Fibonacci retracement for Oct - Dec upleg
• SUP 3: 0.6360 Low Nov 14
• SUP 4: 0.6339 Low Nov 10

AUDUSD initially traded lower Tuesday, before reverting back to flat ahead of the close. The print yesterday through last week’s lows, reinforces a bearish theme and signals scope for an extension towards the bear trigger at 0.6443, the Feb 13 low. A breach of this level would confirm a resumption of the downtrend and open 0.6412, a Fibonacci retracement point. Key short-term resistance is unchanged at 0.6595, the Feb 22 high.

USDCAD TECHS: Trend Needle Points North

• RES 4: 1.3729 76.4% retracement of the Nov 1 - Dec 27 bear leg
• RES 3: 1.3661 High Nov 27
• RES 2: 1.3623 61.8% retracement of the Nov 1 - Dec 27 bear leg
• RES 1: 1.3606 High Feb 28 and the bull trigger
• PRICE: 1.3593 @ 08:04 GMT Mar 6
• SUP 1: 1.3494 50-day EMA
• SUP 2: 1.3441/3359 Low Feb 22 / Low Jan 31 and key S/T support
• SUP 3: 1.3343 Low Jan 12
• SUP 4: 1.3288 Low Jan 5

USDCAD conditions remain bullish and the pair is trading just below its recent highs. The recent print above resistance at 1.3586, the Feb 13 high and bull trigger is a positive development. A clear break of this level would confirm a resumption of the uptrend and open 1.3623 initially, a Fibonacci retracement. Key support lies at 1.3359, the Jan 31 low. Clearance of this level would be bearish. Initial firm support is at 1.3441, the Feb 22 low.

FIXED INCOME

BUND TECHS: (M4) Testing Resistance At The 50-Day EMA

• RES 4: 134.78 50.0% retracement of the Dec 27 - Feb 29 bear cycle
• RES 3: 134.18 High Feb 7
• RES 2: 133.74 High Feb 15
• RES 1: 133.52 High Mar 5
• PRICE: 133.26 @ 05:27 GMT Mar 6
• SUP 1: 132.08 Low Mar 4
• SUP 2: 131.23 Low Feb 29 and the bear trigger
• SUP 3: 131.00 Round number support
• SUP 4: 129.98 Bear channel base drawn from the Dec 27 high

Bund futures traded higher Tuesday and in the process, the contract pierced 133.27, the 50-day EMA. A clear break of this average would signal scope for an extension and open 134.18, the Feb 15 high. Note that a break higher would also result in a bear channel breakout - drawn from the Dec 27 high. A clear breach of the 50-day EMA would also potentially highlight a reversal. On the downside, the bear trigger lies at 131.23 the Feb 29 low.

BOBL TECHS: (M4) Corrective Cycle Still In Play

• RES 4: 119.000 Round number resistance
• RES 3: 118.790 High Feb 15
• RES 2: 118.560 Low Feb 15 and a gap high on the daily chart
• RES 1: 118.330 High Mar 5
• PRICE: 118.170 @ 05:51 GMT Mar 6
• SUP 1: 117.680 Low Mar 4
• SUP 2: 117.440 Low Mar 1
• SUP 3: 117.200 Low Feb 29 and the bear trigger
• SUP 4: 117.000 Round number support

A bearish cycle in Bobl futures remains intact, however, a correction is in play for now and this signals scope for an extension higher near-term. The contract has pierced resistance at 118.270, the Feb 26 high. A continuation higher would open 118.790, the Feb 15 high. On the downside, key support has been defined at 117.200, the Feb 29 low. A break of this level would confirm a resumption of the downtrend.

SCHATZ TECHS: (M4) Trend Condition Remains Bearish

• RES 4: 106.145 High Feb 15
• RES 3: 106.000 Round number resistance
• RES 2: 105.985 High Feb 20
• RES 1: 105.850 High Feb 26
• PRICE: 105.770 @ 06:30 GMT Mar 6
• SUP 1: 105.625 Low Mar 4
• SUP 2: 105.490 Low Feb 29 and the bear trigger
• SUP 3: 105.375 1.236 proj of the Feb 26 - 29 - Mar 5 price swing
• SUP 4: 105.280 1.50 proj of the Feb 26 - 29 - Mar 5 price swing

The downtrend in Schatz futures remains intact and the contract traded to a fresh cycle low last week, reinforcing current conditions. The move down maintains the price sequence of lower lows and lower highs and note too that moving average studies are in a bear mode position, highlighting a clear downtrend. Short-term gains are considered corrective with initial resistance at 105.850, the Feb 26 high. The bear trigger lies at 105.490, the Feb 29 low.

GILT TECHS: (M4) Recovery Extends

• RES 4: 100.00 Psychological round number
• RES 3: 99.77 1.764 retracement of the Feb 26 - 29 bear leg
• RES 2: 99.52 1.618 retracement of the Feb 26 - 29 bear leg
• RES 1: 99.41 High Mar 5
• PRICE: 99.29 @ Close Mar 5
• SUP 1: 98.33/97.91 Low Mar 5 / 4
• SUP 2: 97.42 Low Mar 1
• SUP 3: 96.83 Low Feb 29 and the bear trigger
• SUP 4: 96.00 Round number support

Gilt futures traded sharply higher Tuesday, extending the recovery from last week’s low. Resistance at 98.53, the Feb 26 high, has been cleared. The break eases recent bearish pressure and instead signals scope for a continuation higher near-term. 99.00 has also been cleared and sights are on 99.52 next, a Fibonacci retracement projection. Key support and the bear trigger has been defined at 96.83, the Feb 29 low.

BTP TECHS: (M4) Pierces Key Resistance

• RES 4: 120.65 High Dec 27
• RES 3: 120.00 Round number resistance
• RES 2: 119.26 High Jan 4
• RES 1: 118.90 High Mar 5
• PRICE: 118.54 @ Close Mar 5
• SUP 1: 117.42 20-day EMA
• SUP 2: 116.52 Low Feb 29
• SUP 3: 116.15 Low Feb 22 and the bear trigger
• SUP 4: 116.00 Round number support

BTP futures traded higher Tuesday and this resulted in a print above key short-term resistance at 118.81, the Jan 30 high. A clear break of this hurdle would highlight a bullish reversal and signal scope for a continuation higher near-term. This would open 119.26, the Jan 4 high, ahead of the 120.00 handle. Key short-term support has been defined at 116.15, the Feb 22 low. Clearance of this level would reinstate a bearish theme.

EQUITIES

EUROSTOXX50 TECHS: (H4) Bull Theme Remains Intact

• RES 4: 5002.00 Bull channel top drawn from the Oct 27 low
• RES 3: 4967.50 2.50 projection of the Nov 8 - 24 - 28 price swing
• RES 2: 4939.30 2.382 projection of the Nov 8 - 24 - 28 price swing
• RES 1: 4930.00High Mar 4
• PRICE: 4899.00 @ 06:16 GMT Mar 6
• SUP 1: 4816.80 20-day EMA
• SUP 2: 4734.00 Low Feb 15
• SUP 3: 4690.60 50-day EMA
• SUP 4: 4636.20 Bull channel base drawn from the Oct 27 low

A bullish theme in Eurostoxx 50 futures remains intact and Monday’s fresh cycle high reinforces this theme. Moving average studies remain in a bull-mode position and this set-up highlights positive market sentiment. Sights are on 4939.30 next, a Fibonacci projection. Further out, scope is seen for a climb towards a bull channel top at 5008.70. The channel is drawn from the Oct 27 low. Initial firm support lies at 4816.80, the 20-day EMA.

E-MINI S&P TECHS: (H4) Corrective Pullback

• RES 4: 5193.61 3.0% Bollinger Band
• RES 3: 5172.19 2.0% 10-dma envelope
• RES 2: 5170.86 2.236 proj of Nov 10 - Dec 1 - 7 price swing
• RES 1: 5157.75 High Mar 1
• PRICE: 5090.00 @ 07:25 GMT Mar 6
• SUP 1: 5049.64 20-day EMA
• SUP 2: 4935.76 50-day EMA
• SUP 3: 4866.00 Low Jan 31 and key support
• SUP 4: 4808.50 Low Jan 19

The trend condition in S&P E-Minis remains bullish and the latest move lower appears to be a correction. Price action continues to highlight the fact that corrections are shallow - this is a bullish signal that highlights positive market sentiment. Support to watch is 5049.64, the 20-day EMA. A clear break of this average would signal potential for a deeper retracement towards 4935.76, the 50-day EMA. Sights are on 5170.86, a Fibonacci projection.

COMMODITIES

BRENT TECHS: (K4) Trend Structure Remains Bullish

• RES 4: $88.31 - High Oct 20
• RES 3: $86.52 - High Oct 27
• RES 2: $85.47 - 76.4% retracement of the Sep 15 - Dec 13 bear cycle
• RES 1: $84.34 - High Mar 1
• PRICE: $82.26 @ 06:56 GMT Mar 6
• SUP 1: $80.66/76.41 - 50-day EMA / Low Feb 5 and key S/T support
• SUP 2: $74.84 - Low Jan 03
• SUP 3: $73.22 - Low Dec 13 and the bear trigger
• SUP 4: $70.80 - Low Jun 23 ‘23

Brent futures remain below their most recent highs. Attention is on the $83.65 key resistance, the Jan 29 high. It was pierced last Friday. A clear break of this hurdle would cancel a bearish theme and instead signal a resumption of the bull cycle that has been in place since Dec 13. This would open $85.47, a Fibonacci retracement point. On the downside, initial pivot support to watch lies at $80.66, the 50-day EMA.

WTI TECHS: (J4) Pullback Considered Corrective

• RES 4: $85.75 - High Sep 15 and a key resistance
• RES 3: $84.66 - High Oct 20
• RES 2: $81.70 - 76.4% retracement of the Sep 19 - Dec 13 bear cycle
• RES 1: $80.85 - High Mar 1
• PRICE: $78.41 @ 07:20 GMT Mar 6
• SUP 1: $76.24/71.49 - 50-day EMA / Low Feb 5
• SUP 2: $69.79 - Low Jan 3
• SUP 3: $68.57 - Low Dec 13 and the bear trigger
• SUP 4: $65.41 - Low Jun 12

The WTI futures trend condition remains bullish and last week’s break of key resistance at $79.09, the Jan 29 high, reinforces this theme. The clear breach of this hurdle highlights potential for a continuation towards $81.70, a Fibonacci retracement. On the downside, support to watch is $76.24, the 50-day EMA. A break would instead signal a possible top. The latest pullback is considered corrective.

GOLD TECHS: Fresh All-Time Cycle High

• RES 4: $2230.1 - 1.50 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 3: $2206.6 - 1.382 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 2: $2177.6 - 1.236 proj of the Oct 6 - 27 - Nov 13 price swing
• RES 1: $2141.8 - High Mar 5
• PRICE: $2126.2 @ 05:52 GMT Mar 6
• SUP 1: $2088.5 - High Dec 28
• SUP 2: $2065.5 - High Feb 1 and a recent breakout level
• SUP 3: $2048.9/2033.1 - 20- and 50-day EMA values
• SUP 4: $1984.3 Low Feb 14

Gold remains firm on the back of the latest rally. The yellow metal yesterday traded above resistance at $2135.4, the Dec 4 high to deliver a fresh all-time cycle high. The break reinforces bullish conditions and signals scope for a climb towards $2177.6 next, a Fibonacci projection. Short-term conditions are overbought, however, this does not appear to be a concern for bulls - for now. Initial support lies at $2088.5, the Dec 28 high.

SILVER TECHS: Has Cleared Resistance

• 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 - High Dec 22
• RES 1: $24.226 - High Mar 5
• PRICE: $23.700 @ 08:07 GMT Mar 6
• SUP 1: $22.991/21.883 - 50-day EMA / Low Nov 13 and 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

Silver rallied sharply higher Monday and in the process, the metal cleared resistance at $23.534, the Jan 12 high and a reversal trigger. This cancels a recent bearish theme and instead signals scope for a stronger rally above $24.00, towards $24.606, the Dec 22 high. On the downside, initial firm support to watch lies at $22.991, the 50-day EMA. A break of this average would signal a possible reversal.