MNI DAILY TECHNICAL ANALYSIS - USDJPY Correction Extends

Price Signal Summary - USDJPY Correction Extends

• In the equity space:
  • S&P E-minis have traded higher again today reaching highs just above 4100.00. The next objective is 4124.75, 1.382 projection of the Feb 1 - Feb 16 - Mar 4 price swing.
  • EUROSTOXX 50 maintains a bullish tone with the focus on 4000.00. A break would open 4047.72, 2.236 projection of the Dec 21 - Jan 8 - Jan 28 price swing
• In the FX world, EURUSD maintains a short-term bullish tone and is trading closer to recent highs. The focus is on 1.1940, the 50-day EMA and a key resistance area. The GBPUSD outlook remains bearish. Recent gains have stalled at the former bull channel base drawn off the Nov 2 low. Resistance has been defined at 1.3919, Tuesday's intraday high. Continued weakness would expose key support at 1.3670, Mar 25 low. EURGBP remains bullish. The price pattern on Tuesday was a bullish engulfing candle. This exposed the next key resistance zone at 0.8646, Mar 24 high and S/T reversal trigger and 0.8653, 50-day EMA. Both have been breached and this opens 0.8731, Feb 26 high. USDJPY traded lower yesterday as the corrective cycle extends. Support at 109.35, the 20-day EMA has been probed. A clear break would open 109.13, Mar 26 low.
• On the commodity front:
  • Gold is holding onto recent gains. Key resistance at $1755.5, Mar 18 high has been probed. A clear break is required to suggest scope for a stronger bounce.
  • Brent (M1) key directional triggers are unchanged with:
    • Resistance at $65.39, Mar 29 high and key support at $60.33, Mar 23 low and the bear trigger.
  • WTI (K1) directional triggers are:
    • Resistance at $62.27, Mar 30 high and support at $57.25, Mar 23 low and the bear trigger
• In the FI space, Bunds (M1) remain vulnerable despite recent gains. Key support to watch is at 170.52, Mar 18 low. Key resistance is at 172.66, Mar 25 high. The key support and bear trigger in Gilts (M1) remains 126.79, Mar 18 low.

FOREIGN EXCHANGE

EURUSD TECHS: Focus Is On The 50-day EMA

• RES 4: 1.2037 2.0% 10-dma envelope
• RES 3: 1.1990 High Mar 11 and a key resistance
• RES 2: 1.1940 50-day EMA
• RES 1: 1.1927 High Apr 8
• PRICE: 1.1904 @ 06:03 GMT Apr 9
• SUP 1: 1.1859 20-day EMA
• SUP 2: 1.1795 Low Apr 6
• SUP 3: 1.1738 Low Apr 5
• SUP 4: 1.1704/1695 Low Mar 31 / 38.2% of the Mar 2020 - Jan rally

EURUSD traded higher yesterday and is holding onto this week's rally. Price gains have resulted in price moving into its bear channel range drawn off this year's Jan 6 high - the channel base was breached in March. Gains are still considered corrective though with the next firm resistance at 1.1940, the 50-day EMA. A clear break of the average would signal scope for an extension higher. Initial support is 1.1859, the 20-day EMA.

GBPUSD TECHS: Remains Below Resistance

• RES 4: 1.3959 High Mar 19
• RES 3: 1.3953 50% Retracement Feb - Mar Downleg
• RES 2: 1.3919/30 High Apr 6 / Former channel bull channel base
• RES 1: 1.3840 High Apr 7
• PRICE: 1.3708 @ 09:34 GMT Apr 9
• SUP 1: 1.3671 Intraday low
• SUP 2: 1.3670/63 Low Mar 25 / Low Feb 5
• SUP 3: 1.3641 38.2% retracement of the Sep 23 - Feb 24 bull cycle
• SUP 4: 1.3567 Low Feb 4

GBPUSD is softer. The pair found resistance this week at 1.3919, on Apr 6. The failure at recent highs highlights the importance of resistance relating to the former bull channel drawn off the Nov 2, 2020 low - the channel base was cleared Mar 23. The base intersects at 1.3940 and a strong break higher is required to strengthen a bullish argument. Key support and the bear trigger is 1.3670, Mar 25 low. A break would open 1.3641, a Fibonacci retracement.

EURGBP TECHS: Bull Cycle Intact

• RES 4: 0.8791 High Feb 12
• RES 3: 0.8730/31 2.0% 10-dma envelope / High Feb 26
• RES 2: 0.8705 High Mar 1
• RES 1: 0.8698 Intraday high
• PRICE: 0.8674 @ 09:35 GMT Apr 9
• SUP 1: 0.8582 Low Apr 7
• SUP 2: 0.8472 Low Apr 5 and the bear trigger
• SUP 3: 0.8431/30 3.0% Lower Bollinger Band / Low Feb 27, 2020
• SUP 4: 0.8356 Low Feb 26

EURGBP traded higher yesterday with the cross holding onto this week's bullish theme. In pattern terms, Tuesday was a bullish engulfing candle and suggested the cross had entered a corrective cycle. Recent gains have now seen prices top the key resistance at 0.8646, Mar 24 high and the 50-day EMA at 0.8654. Further gains would open 0.8731, Feb 26 high. Initial support is at 0.8582, Apr 7 low.

USDJPY TECHS: Corrective Cycle Extends

• RES 4: 111.71 High Mar 24
• RES 3: 111.30 High Mar 26, 2020
• RES 2: 110.55/97 High Apr 6 / High Mar 31 and the bull trigger
• RES 1: 109.94 High Apr 7
• PRICE: 109.34 @ 06:29 GMT Apr 9
• SUP 1: 109.00 Low Apr 8
• SUP 2: 108.41 Low Mar 23 and key support
• SUP 3: 107.87 50-day EMA
• SUP 4: 106.97 Low Mar 4

USDJPY was under pressure yesterday, trading lower and extending the pullback from the Mar 31 high extends. The pair has breached support highlighted by the 20-day EMA at 109.35. The break lower suggests scope for a deeper pullback with attention turning to the 109.00 handle ahead of 108.41, Mar 23 low. The current pullback is allowing an overbought trend condition to unwind. Initial resistance 109.94, Apr 7 high.

EURJPY TECHS: Attention Is On The 20-Day EMA

• RES 4: 132.36 1.382 proj of the Jun - Sep - Oct 2020 price swing
• RES 3: 131.58 High Oct 4, 2018
• RES 2: 131.22 1.236 proj of the Jun - Sep - Oct 2020 price swing
• RES 1: 130.69 High Apr 7 and the bull trigger
• PRICE: 130.11 @ 06:45 GMT Apr 9
• SUP 1: 129.57/13 Low Apr 8 / Low Mar 30
• SUP 2: 128.76/75 50-day EMA / Trendline drawn off Oct 30, 2020 low
• SUP 3: 127.50 Low Feb 22
• SUP 4: 127.31 Low Feb 17

EURJPY traded below 130.00 yesterday but did manage to find support at the day low. The cross has tested the 20-day EMA at 129.67. A clear break of the average would suggest scope for a deeper pullback and expose support highlighted by the 50-day EMA at 128.76 and trendline support at 128.75, drawn off the Oct 30, 2020 low. Clearance of this zone would signal a reversal. The trigger for a resumption of the uptrend is 130.69.

AUDUSD TECHS: Consolidating In A Range

• RES 4: 0.7849 High Mar 18 and a key resistance
• RES 3: 0.7774 High Mar 19
• RES 2: 0.7750 High Mar 23
• RES 1: 0.7680 50-day EMA and trendline drawn off the Feb 25 high
• PRICE: 0.7615 @ 09:36 GMT Apr 9
• SUP 1: 0.7588 Intraday low
• SUP 2: 0.7532/17 Low Apr 1 and the bear trigger / Low Dec 22
• SUP 3: 0.7462 Low Dec 21
• SUP 4: 0.7418 23.6% retracement of the Mar 2020 - Feb rally

AUDUSD is weaker but remains within the recent range and above recent lows. Key support is at 0.7532, Apr 1 low and the outlook remains bearish. The pair has recently breached 0.7563, Mar 25 low and also cleared the Feb 2 low of 0.7564. This reinforces a bearish theme following the confirmation of a head and shoulders reversal pattern on Mar 23. This has opened 0.7517, Dec 22 low. Initial resistance is seen at 0.7680, the 50-day EMA.

USDCAD TECHS: Still Looking For Gains

• RES 4: 1.2763 High Feb 12
• RES 3: 1.2749 High Feb 26 and key resistance
• RES 2: 1.2700 High Mar 8
• RES 1: 1.2647 High Mar 30 and the short-term bull trigger
• PRICE: 1.2592 @ 06:59 GMT Apr 9
• SUP 1: 1.2502 Low Apr 5 and key near-term support
• SUP 2: 1.2462 Low Mar 19
• SUP 3: 1.2365 Low Mar 18 and the bear trigger
• SUP 4: 1.2336 1.00 proj of the Jan 28 - Feb 25 - Feb 26 price swing

The USDCAD outlook remains bullish following the recent recovery from 1.2502, Apr 5 low. Short-term trend signals point north and attention is on resistance at 1.2647, Mar 30 high and the bull trigger. A break would confirm a resumption of the recovery that started Mar 18 and would open 1.2749, Feb 26 high. Key near-term support is 1.2502. A breach would instead signal a resumption of bearish activity.

FIXED INCOME

BUND TECHS: (M1) Holds Onto Recent Corrective Gains

• RES 4: 172.78 0.764 proj of the Feb 25 - Mar 11 - Mar 18 price swing
• RES 3: 172.66 High Mar 25
• RES 2: 172.34 High Mar 29
• RES 1: 172.12 High Apr 8
• PRICE: 171.97 @ 04:58 GMT Apr 9
• SUP 1: 171.32 Low Apr 6
• SUP 2: 170.71/52 Low Mar 30 / Low Mar 18 and key support
• SUP 3: 170.00 Round number support
• SUP 4: 169.24 Low Feb 24 and major support

Bund futures are trading near recent highs following the corrective bounce from the March 30 low. Attention remains on key S/T support at 170.52, Mar 18 low. Clearance of this level would strengthen a bearish argument and signal scope for a deeper sell-off. The move lower from 172.66, Mar 25 low suggests the recovery between Feb 25 - Mar 25 has been a correction and that this correction is possibly over. Key resistance is at 172.66, Mar 25 high.

BOBL TECHS: (M1) Correction Extends

• RES 4: 135.544 0.764 proj of the Feb 26 - Mar 3 - Mar 9 price swing
• RES 3: 135.520 High Mar 25
• RES 2: 135.440 High Mar 29
• RES 1: 135.350 High Apr 8
• PRICE: 135.310 @ 05:08 GMT Apr 9
• SUP 1: 135.100 Low Apr 6
• SUP 2: 134.940/870 Low Mar 30 / Low Mar 19 and key S/T support
• SUP 3: 134.780 Low Mar 8 and 9
• SUP 4: 134.670 61.8% retracement of the Feb 26 - Mar 25 rally

Bobl futures maintain a bearish focus and recent gains are still considered corrective in nature. Attention remains on support at 134.870, Mar 18 low where a break would strengthen a bearish argument and suggest scope for a deeper pullback. This would open 134.780, the Mar 8 and 9 lows and potentially below. For bulls, key resistance has been defined at 135.520, Mar 25 high. Clearance of this level is required to reinstate the recent bull cycle.

SCHATZ TECHS: (M1) Corrective Cycle

• RES 4: 112.177 50-day EMA (cont)
• RES 3: 112.174 0.618 proj of the Feb 26 - Mar 2 - Mar 10 price swing
• RES 2: 112.165 High Mar 25 and the bull trigger
• RES 1: 112.150 High Apr 8
• PRICE: 112.145 @ 05:17 GMT Apr 9
• SUP 1: 112.105/080 Low Apr 6 / Low Mar 31
• SUP 2: 112.070 Low Mar 18 and a key near-term support
• SUP 3: 112.060 Low Mar 10
• SUP 4: 112.026 61.8% retracement of the Feb 26 - Mar 25 rally

Schatz futures traded higher yesterday but remain below recent highs with key resistance at 112.165, Mar 25 high. Recent gains are considered corrective and a bearish focus remains intact. A move lower would expose support at 112.070, Mar 18 low where a break would strengthen a bearish argument and open 112.060, Mar 10 low and potentially below. On the upside, clearance of 112.165 is needed to reinstate a bullish theme.

GILT TECHS: (M1) Remains Below Resistance

• RES 4: 129.75 High Feb 19
• RES 3: 129.27 High Mar 2 and the reversal trigger
• RES 2: 128.93 High Mar 25
• RES 1: 128.66 High Apr 8
• PRICE: 128.48 @ Close Apr 8
• SUP 1: 127.32 Low Apr 1
• SUP 2: 126.79 Low Mar 18 and the bear trigger
• SUP 3: 126.55 Low Apr 17, 2019 (cont)
• SUP 4: 126.00 Round number support

Gilt futures traded higher yesterday. Despite recent gains, the downtrend remains intact. Attention is on key support at 126.79, Mar 18 low and the trigger for a resumption of the trend. Clearance of this level would pave the way for a test of the 126.00 handle. On the upside, initial firm resistance has been defined at 128.93, Mar 25 high. A break of this level would expose the key hurdle for bulls at 129.27, Mar 2 high.

BTP TECHS: (M1) Directional Triggers Defined

• RES 4: 151.05 1.50 proj of the Feb 26 - Mar 3 - Mar 5 price swing
• RES 3: 150.69 76.4% retracement of the Feb 12 - 26 sell-off
• RES 2: 150.39 High Mar 11 and key short-term resistance
• RES 1: 149.88 High Apr 6
• PRICE: 149.33 @ Close Apr 8
• SUP 1: 148.57 Low Mar 30
• SUP 2: 148.36 Low Mar 18 and key short-term support
• SUP 3: 148.20 61.8% retracement of the Feb 26 - Mar 11 rally
• SUP 4: 147.68 76.4% retracement of the Feb 26 - Mar 11 rally

Recent price action in BTP futures have defined resistance at 150.39, Mar 11 high and support at 148.36, Mar 18 low as key short-term directional triggers. While 150.39 and a pivotal level at 150.69, 76.4% of the Feb 12 - 26 sell-off remain intact, the short-term risk appears skewed to the downside. A breach of 148.36, Mar 18 low would reinforce a bearish argument and signal scope for a deeper pullback. Clearance of 150.39 would instead be bullish.

EQUITIES

EUROSTOXX 50 Techs: Eyeing The 4000.00 Handle

• RES 4: 4110.24 High Jan 18, 2008
• RES 3: 4047.72 2.236 proj of Dec 21 - Jan 8 rally from Jan 28 low
• RES 2: 4000.00 Psychological round number
• RES 1: 3988.10 High Apr 7
• PRICE: 3977.83 @ Close Apr 8
• SUP 1: 3950.18 Low Apr 6
• SUP 2: 3910.90 Low Mar 31
• SUP 3: 3874.22 20-day EMA
• SUP 4: 3841.46 Low Mar 26

EUROSTOXX 50 registered a fresh trend high Wednesday and maintains a firmer tone. The recovery from 3784.09, Mar 25 low, confirmed a resumption of the uptrend, extending the bullish price sequence of higher highs and higher lows. Attention is on the psychological 4000.00 handle next. On the downside, key trend support is at 3784.09. A break is required to signal a potential short-term top. Bullish!

COMMODITIES

BRENT TECHS: (M1) Consolidating

• RES 4: $70.67 - High Mar 8 and the key bull trigger
• RES 3: $69.50 - High Mar 15
• RES 2: $67.76- High Mar 18
• RES 1: $65.39 - High Mar 29 and the bull trigger
• PRICE: $62.97 @ 06:53 Apr 9
• SUP 1: $61.25 - Low Apr 5
• SUP 2: $60.33 - Low Mar 23 and the bear trigger
• SUP 3: $58.27 - 38.2% retracement of the Nov 2 - Mar 8 rally
• SUP 4: $56.80 - High Jan 13

Brent crude futures are unchanged and consolidating plus remain below recent highs. The Mar 30 break higher through $64.97, Mar 22 high failed to deliver any bullish follow through despite signalling scope for a recovery. Price would need to trade above $65.39, Mar 30 high to again suggest scope for an extension higher. This would open $67.76, Mar 18 high. On the downside, key support and the bear trigger is at $60.33, low Mar 23.

WTI TECHS: (K1) Caught In A Range

• RES 4: $67.79 - High Mar 8 and the bull trigger
• RES 3: $66.44 - High Mar 15
• RES 2: $64.88 - High Mar 18 and a key near-term resistance
• RES 1: $62.27 - High Mar 30
• PRICE: $59.51 @ 06:58 Apr 9
• SUP 1: $57.63 - Low Apr 5
• SUP 2: $57.25 - Low Mar 23 and the bear trigger
• SUP 3: $55.65 - 38.2% retracement of the Nov 2 - Mar 8 rally
• SUP 4: $53.68 - High Jan 13

WTI futures are unchanged and the contract is consolidating. The Mar 30 break above resistance at $62.04, Mar 22 high, failed to deliver any bullish follow through despite signalling scope for a recovery. Price needs to clear $62.27, Mar 30 high to once again suggest scope for gains. This would open $64.88, the Mar 18 high. On the downside, key support and the bear trigger is unchanged at $57.25, Mar 23 low. A break would resume bearish pressure.

GOLD TECHS: Testing A Key Resistance Zone

• RES 4: $1816.0 - High Feb 23
• RES 3: $1805.7 - High Feb 25
• RES 2: $1775.9 - High Feb 26
• RES 1: $1759.8 - 50-day EMA
• PRICE: $1755.8 @ 07:18 GMT Apr 9
• SUP 1: $1721.4 - Low Apr 5
• SUP 2: $1705.9 - Low Apr 1
• SUP 3: $1676.9 - Low Mar 8 and the bear trigger
• SUP 4: $1671.0 - Low Jun 5, 2020

Gold traded higher yesterday extending the recovery from $1678.0, Mar 31 low. The yellow metal has probed $1755.5, Mar 18 high and attention turns to the 50-day EMA at $1759.8. A clear break of the $1755.5-59.8 zone is required to signal scope for a stronger recovery and place the recent bearish focus on hold. This would open $1805.7, the Feb 25 high. Key support and the bear trigger remains $1676.9, Mar 8 low. Initial firm support is at $1721.4.

SILVER TECHS: Resistance Seen At The 50-day EMA

• RES 4: $26.636 - High Mar 18 and firm near-term resistance
• RES 3: $26.318 - High Mar 19
• RES 2: $25.717 - 50-day EMA
• RES 1: $25.617 - High Apr 8
• PRICE: $25.273 @ 07:24 GMT Apr 9
• SUP 1: $24.617 - Low Apr 5
• SUP 2: $23.781 - Low Mar 31
• SUP 3: $23.524 - Low Dec 7 and key near-term support
• SUP 4: $22.591 - Low Dec 12

Silver is holding onto recent gains following the recovery from $23.781, Mar 31 high and traded higher again yesterday. Despite these recent gains, the outlook remains bearish and upticks are considered corrective. Recent weakness has opened $23.524, Dec 7 low and a key near-term support. On the upside, the 20-day EMA has been probed. An extension higher would expose $25.717, the 50-day EMA.