MNI DAILY TECHNICAL ANALYSIS - USDJPY Gains Expose 150.00

Price Signal Summary - USDJPY Continues To Appreciate, Sights Are On 150.00.

• In the equity space, S&P E-Minis are firmer this week. A volatile session last Thursday resulted in a strong bounce from 3502.00. The subsequent recovery suggests the contract has entered a corrective phase. The 20-day EMA has been breached, reinforcing a bullish theme and this has opened 3820.00, the Oct 5 high and a bull trigger. Key support lies at 3502.00. The EUROSTOXX 50 futures are firmer as price extends the recovery from 3251.00, Oct 13 low. The 50-day EMA, at 3472.00 has been breached - a positive development. Attention is on; resistance at 3492.00, the Oct 6 high and bull trigger and trendline resistance drawn from the Aug 17 high, which intersects at 3504.30 today. Clearance of 3492.00 and 3504.30 would highlight a strong short-term bullish development. Initial support is at 3352.00, Oct 14 low.
• In FX, EURUSD started the week on a firmer note, trading higher Monday and has breached the 20-day EMA. Attention on key resistance at 0.9918 - the top of the bear channel drawn from the Feb 10 high. A clear break of this hurdle would highlight a channel breakout and a stronger reversal. For now, gains are considered corrective. Key short-term support is at 0.9633, the Oct 13 low. GBPUSD is holding on to the bulk of its recent gains. Attention is on 1.1495, the Oct 5 high and bull trigger. The pair has traded above the 20-day EMA and this has improved short-term conditions for bulls. A break of 1.1495 would strengthen a bullish condition. Key short-term support is at 1.0924, the Oct 12 high. USDJPY maintains a bullish tone and the path of least resistance remains up. Last week's gains resulted in a break of 145.90, Sep 22 high and 147.66, the Aug 1998 high. This paves the way for a climb towards the 150.00 handle next.
• On the commodity front, the recent strong reversal in Gold signals the end of the recovery between Sep 28 - Oct 4 and note that price has moved below the trendline resistance drawn from the Mar 8 high. This highlights a bearish threat and signal scope for weakness towards $1615.0, the Sep 28 low. In the Oil space, WTI futures remain vulnerable and the contract has traded lower this week. This reinforces a short-term bearish theme and opens $82.89, the 61.8% retracement of the Sep 26 - Oct 10 rally.
• In the FI space, the broader bearish theme in Bund futures remains intact. Attention is on 135.52, the Sep 28 low and key support. This level was probed on Oct 12, a clear break would confirm a resumption of the downtrend and open the 135.00 handle. Resistance is at 138.72 the 20-day EMA. The primary trend direction in Gilt futures is down despite the recovery from 90.38, the Oct 12 low. Initial resistance to watch is at 97.27, the 20-day EMA. The average has been pierced and a clear break is needed to suggest scope for a stronger corrective bounce towards 100.92, the Oct 4 high and a key resistance. 90.38, the Oct 12 low, is the bear trigger.

FOREIGN EXCHANGE

EURUSD TECHS: Approaching Bear Channel Resistance

• RES 4: 1.0198 High Sep 12 and a key resistance
• RES 3: 1.0051 High Sep 20
• RES 2: 0.9999 High Oct 4 and a reversal trigger
• RES 1: 0.9918 Bear channel top from Feb 10 high
• PRICE: 0.9859 @ 05:45 BST Oct 18
• SUP 1: 0.9711/9633 Low Oct 17 / 13
• SUP 2: 0.9536 Low Sep 28 and key support
• SUP 3: 0.9501 1.382 projection of the Aug 10 - Sep 6 - 12 price swing
• SUP 4: 0.9380 Bear channel base drawn from the Feb 10 high

EURUSD started the week on a firmer note, trading higher and in the process breached the 20-day EMA. Attention on the first key resistance at 0.9918 - the top of the bear channel drawn from the Feb 10 high. A clear break of this hurdle would highlight a channel breakout and a stronger bullish reversal. For now, the trend remains down and gains are considered corrective. Key short-term support is at 0.9633, the Oct 13 low.

GBPUSD TECHS: Approaching Key Resistance

• RES 4: 1.1738 High Sep 13 and a key resistance
• RES 3: 1.1590 High Sep 14
• RES 2: 1.1456/1495 50-day EMA / High Oct 5 and the bull trigger
• RES 1: 1.1439 High Oct 17
• PRICE: 1.1388 @ 05:51 BST Oct 18
• SUP 1: 1.1152/1058 Low Oct 14 / 13
• SUP 2: 1.0924/22 Low Oct 12 / 50.0% of Sep 26 - Oct 5 bull cycle
• SUP 3: 1.0787 61.8% retracement of Sep 26 - Oct 5 bull cycle
• SUP 4: 1.0541/0350 Low Sep 28 / All Time Low

GBPUSD traded higher Monday extending the bounce from last Wednesday's 1.0924 low. The recent move lower between Oct 5 - 12 appears to have been a correction. A continuation higher would signal scope for a test and possible breach of 1.1495, the Oct 5 high and bull trigger. Clearance of this level would strengthen bullish conditions. On the downside, key short-term support has been defined at 1.0924, the Oct 12 low.

EURGBP TECHS: Bearish Outlook

• RES 4: 0.9292 High Sep 11 2020
• RES 3: 0.9066/9266 High Sep 28 / High Sep 26 and key resistance
• RES 2: 0.8980 High Sep 29
• RES 1: 0.8738/8867 20-day EMA / High Oct 12
• PRICE: 0.8649@ 06:04 BST Oct 18
• SUP 1: 0.8559 76.4% retracement of the Aug 2 - Sep 26 rally
• SUP 2: 0.8522 Low Aug 30
• SUP 3: 0.8471 Low Aug 28
• SUP 4: 0.8408 Low Aug 24

EURGBP maintains a bearish tone. The contract traded lower last week, extending the pullback from 0.8867, the Oct 12 high. The sell-off resulted in a break of support at 0.8649 and a move below the 50-day EMA at 0.8677. This signals scope for an extension lower and has opened 0.8559, a Fibonacci retracement level. Key short-term resistance has been defined at 0.8867 where a break is required to reinstate a bullish theme.

USDJPY TECHS: Northbound

• RES 4: 150.45 3.618 proj of the Aug 2 - 8 - 11 price swing
• RES 3: 150.00 Psychological round number
• RES 2: 149.83 3.50 proj of the Aug 2 - 8 - 11 price swing
• RES 1: 149.29 Intraday high
• PRICE: 148.83 @ 10:06 BST Oct 18
• SUP 1: 147.06 Low Oct 14
• SUP 2: 145.73/145.37 / Low Oct 12 / 20-day EMA
• SUP 3: 143.53 Low Oct 5
• SUP 4: 142.26 50-day EMA

USDJPY maintains a bullish tone and the pair continues to climb. Last week's gains resulted in a break of 145.90, the Sep 22 high, confirming a resumption of the primary uptrend. It also marked an extension of the price sequence of higher highs and higher lows. Note too that 147.66, the Aug 1998 high, has been cleared. The break reinforces bullish conditions and opens 149.83, a Fibonacci projection, ahead of 150.00 Firm trend support lies at 145.37.

EURJPY TECHS: Clears Key Resistance

• RES 4: 148.88 High Dec 9 2014
• RES 3: 148.45 High Dec 15 2014
• RES 2: 147.76 1.236 proj of the May 12 - Jun 28 - Aug 2 price swing
• RES 1: 147.00 Round number resistance
• PRICE: 146.77 @ 06:27 BST Oct 18
• SUP 1: 144.09 High Oct 5
• SUP 2: 142.57/141.20 20-day EMA / 50-day EMA
• SUP 3: 139.44/137.40 Low Sep 29 / 26 and key support
• SUP 4: 136.02 Low Aug 25

EURJPY started the week on a firm note as the uptrend accelerated Monday. The cross has cleared key resistance at 145.64, the Sep 12 high and bull trigger. This confirms a resumption of the broader uptrend that started in May 2020 and clears the way for a climb towards 147.76 next, a Fibonacci projection. Moving average studies are in a bull mode position, highlighting a broader uptrend. Initial support lies at 144.09, the Oct 5 high.

AUDUSD TECHS: Path Of Least Resistance Remains Down

• RES 4: 0.6632 50-day EMA
• RES 3: 0.6656 High Sep 23
• RES 2: 0.6547 High Oct 4 and key resistance
• RES 1: 0.6363/6430 Low Sep 28 / 20-day EMA
• PRICE: 0.6320 @ 06:43 BST Oct 18
• SUP 1: 0.6170 Low Oct 13
• SUP 2: 0.6133 1.382 proj of the Apr 5 - May 12 - Jun 3 price swing
• SUP 3: 0.6099 76.4% retracement of the 2020 - 2021 bull cycle
• SUP 4: 0.6035 1.50 proj of the Apr 5 - May 12 - Jun 3 price swing

AUDUSD is trading above its recent lows. A bearish theme remains intact and short-term gains are considered corrective. The pair has recently cleared 0.6363, the Sep 28 low and bear trigger. The break confirmed a resumption of the primary downtrend and the print below 0.6200 exposes 0.6133 next, a Fibonacci projection. On the upside, initial firm resistance to watch is 0.6430, the 20-day EMA.

USDCAD TECHS: Pullback Considered Corrective

• RES 4: 1.4040 76.4% retracement of the 2020 - 2021 bear cycle
• RES 3: 1.4016 3.382 proj of the Aug 25 - Sep 7 - 13 price swing
• RES 2: 1.4000 Psychological round number
• RES 1: 1.3898/3977 High Oct 14 / 13 and the bull trigger
• PRICE: 1.3702 @ 08:03 BST Oct 18
• SUP 1: 1.3640 20-day EMA
• SUP 2: 1.3503 Low Oct 4 and a key support
• SUP 3: 1.3387 50-day EMA
• SUP 4: 1.3358 Low Sep 21

USDCAD started the week on a bearish note and reversed Friday’s gains. Despite the pullback, the uptrend remains intact. The latest recovery from 1.3503, Oct 10 high, reinforces bullish conditions and this low represents a key short-term support. Moving average studies continue to highlight an uptrend and 1.3838, the Sep 30 high and key resistance has been cleared, strengthening bullish conditions. Support to watch is 1.3640, the 20-day EMA.

FIXED INCOME

BUND TECHS: (Z2) Gains Considered Corrective

• RES 4: 144.56 High Sep 12
• RES 3: 143.68 38.2% retracement of the Aug 2 - Sep 28 bear leg
• RES 2: 140.13/42.87 High Oct 6 / 4
• RES 1: 138.72 20-day EMA
• PRICE: 137.35 @ 05:23 BST Oct 18
• SUP 1: 135.14 Low Oct 12 and the bear trigger
• SUP 2: 135.00 Round number support
• SUP 3: 134.76 4.382 proj of the Aug 2 - 12 - 15 price swing
• SUP 4: 134.24 4.50 proj of the Aug 2 - 12 - 15 price swing

Bund futures remain in a downtrend and recent short-term gains are considered corrective. The reversal from 142.87, Oct 4 high, marked the end of the correction between Sep 28 - Oct 4 and confirmed a resumption of the primary downtrend. This reinforced a broader bearish theme and moving average studies remain in a bear mode position. Key resistance is at 142.87. The 20-day EMA, at 138.72, is the first resistance to watch.

BOBL TECHS: (Z2) Trend Remains Down

• RES 4: 122.510 High Sep 12
• RES 3: 121.950 High Oct 4 and the bull trigger
• RES 2: 121.330 High Oct 5
• RES 1: 119.831 20-day EMA
• PRICE: 119.410 @ 05:33 BST Oct 18
• SUP 1: 118.550 Low Oct 13
• SUP 2: 118.020 Low Sep 28 and the bear trigger
• SUP 3: 117.918 2.382 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 4: 117.630 2.50 proj of the Aug 25 - Sep 1 - Sep 6 price swing

Bobl futures continue to consolidate and trade closer to recent lows. The trend remains down. The reversal from 121.950, Oct 4 high confirmed the end of the corrective cycle between Sep 28 and Oct 4. Attention is on the key support and bear trigger at 118.020, the Sep 28 low. A break of this level would confirm a resumption of the primary downtrend. 121.950 marks key resistance. The 20-day EMA, at 119.831, is the first resistance.

SCHATZ TECHS: (Z2) Trend Needle Still Points South

• RES 4: 108.010 High Sep 13
• RES 3: 107.770 High Oct 4 and key resistance
• RES 2: 107.610 High Oct 5
• RES 1: 107.135 20-day EMA
• PRICE: 106.915 @ 05:41 BST Oct 18
• SUP 1: 106.775 Low Oct 11
• SUP 2: 106.535 Low Sep 26 and key support
• SUP 3: 106.379 2.382 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 4: 105.800 Low Nov 2008 (cont)

Schatz futures continue to consolidate. The primary trend direction is down. The reversal from 107.770, Oct 4 high, signals a resumption of the broader downtrend and attention is on key support and the bear trigger at 106.535, the Sep 26 low. A break would confirm a resumption of the primary downtrend. Key resistance has been defined at 107.770, where a breach would highlight a stronger reversal.

GILT TECHS: (Z2) Watching The 20-Day EMA

• RES 4: 105.34 High Sep 22
• RES 3: 102.45 High Sep 23
• RES 2: 100.92 High Oct 4 and a key resistance
• RES 1: 97.27/98.24 20-day EMA / High Oct 14
• PRICE: 97.23 @ Close Oct 17
• SUP 1: 92.66 Low Oct 14
• SUP 2: 90.99/90.38 Low Sep 28 / Low Oct 12 and the bear trigger
• SUP 3: 90.00 Psychological round number
• SUP 4: 88.94 2.764 proj of the May 12 - Jun 16 - Aug 2 swing (cont)

The primary trend direction in Gilt futures is down despite the recovery from 90.38, the Oct 12 low. Short-term gains are considered corrective and moving average studies are in a bear mode position. Initial resistance to watch is at 97.27, the 20-day EMA. The average has been pierced and a clear break is needed to suggest scope for a stronger corrective bounce towards 100.92, the Oct 4 high and a key resistance. 90.38 is the bear trigger.

BTP TECHS: (Z2) Trend Needle Still Points South

• RES 4: 119.06 High Sep 8 and a key resistance
• RES 3: 118.51 High Sep 13
• RES 2: 117.05 High Sep 22
• RES 1: 112.33/116.71 20-day EMA / High Oct 4
• PRICE: 110.72 @ Close Oct 17
• SUP 1: 108.85 Low Oct 11
• SUP 2: 108.13 Low Sep 28 and key support
• SUP 3: 107.27 2.382 proj of the Aug 25 - Sep 1 - 8 price swing
• SUP 4: 106.68 2.618 proj of the Aug 25 - Sep 1 - 8 price swing

The BTP futures trend condition is unchanged and remains bearish. The reversal from 116.71, the Oct 4 high, signals the end of a corrective phase between Sep 28 - Oct 4. A continuation lower would open the key support and bear trigger at 108.13, the Sep 28 low. A break of this level would confirm a resumption of the broader downtrend and maintain the bearish price sequence of lower lows and lower highs. 116.71 marks the key resistance.

US 10YR FUTURE TECHS: (Z2) Trend Conditions Remain Bearish

• RES 4: 115-13+ Low Sep 7
• RES 3: 114-31+ 38.2% retracement of the Aug 2 - Sep 28 bear leg
• RES 2: 112-14/113-30 20-day EMA / High Oct 4 and the bull trigger
• RES 1: 111-28+ High Oct 12
• PRICE: 110-24 @ 19:42 BST Oct 20
• SUP 1: 110-00 Psychological Support
• SUP 2: 109-23+ Low Nov 30 2007 (cont)
• SUP 3: 108-18+ 1.00 projection of the Oct 4 - 11 - 13 price swing
• SUP 4: 108.14 3.0% 10-dma envelope

Treasuries remain vulnerable. Last week, the contract breached 110-19, the Sep 28 low and bear trigger. This resulted in a break out of the recent consolidative range and highlights a resumption of the downtrend plus maintains the price sequence of lower and lower highs. The focus is on 110.00, a break would strengthen bearish conditions. Initial key resistance is at 112-14, the 20-day EMA. Gains would be considered corrective.

EQUITIES

EUROSTOXX50 TECHS: (Z2) Approaching Key Resistance Points

• RES 4: 3678.00 High Sep 13 and bull trigger
• RES 3: 3585.00 High Sep 14
• RES 2: 3504.30 Trendline resistance drawn from the Aug 17 high
• RES 1: 3492.00 High Oct 6 and a key resistance
• PRICE: 3482.00 @ 06:22 BST Oct 18
• SUP 1: 3352.00 Low Oct 14
• SUP 2: 3251.00/3236.00 Low Oct 13 / 3 and a key support zone
• SUP 3: 3305.00 Low Oct 11
• SUP 4: 3236.00/3229.00 Low Oct 3 / Low Nov 9 2020 (cont)

EUROSTOXX 50 futures are firmer as price extends the recovery from 3251.00, Oct 13 low. Note that price has traded above the 50-day EMA, at 3472.00 - a positive development. Attention is on; resistance at 3492.00, the Oct 6 high and bull trigger and trendline resistance drawn from the Aug 17 high, which intersects at 3504.30 today. Clearance of 3492.00 and 3504.30 would highlight a strong S/T bullish development. Initial support is at 3352.00.

E-MINI S&P (Z2): Clears The 20-Day EMA

• RES 4: 4023.44 61.8% retracement of the Aug 16 - Oct 13 downleg
• RES 3: 3923.88 50.0% retracement of the Aug 16 - Oct 13 downleg
• RES 2: 3849.78 50-day EMA
• RES 1: 3770.50/3820.00 High Oct 7 / 5 and a bull trigger
• PRICE: 3750.50 @ 06:50 BST Oct 18
• SUP 1: 3502.00 Low Oct 13 and the bear trigger
• SUP 2: 3491.13 50.0% retracement of the 2020 - 2022 bull cycle
• SUP 3: 3453.78 1.618 proj of the Aug 16 - Sep 7 - 13 price swing
• SUP 4: 3388.70 1.764 proj of the Aug 16 - Sep 7 - 13 price swing

S&P E-Minis are firmer this week. A volatile session last Thursday resulted in a strong bounce from the day low as well as the trend low of 3502.00. The subsequent recovery suggests the contract has entered a corrective phase and if correct, this will allow an oversold trend condition to unwind. The 20-day EMA has been breached. The break reinforces a bullish theme and opens 3820.00, the Oct 5 high and a bull trigger. Key support lies at 3502.00.

COMMODITIES

BRENT TECHS: (Z2) Bearish Threat

• RES 4: $107.41 - 76.4% retracement of the Aug 6 - Sep 26 bear leg
• RES 3: $104.62 - High Jul 5
• RES 2: $101.39 - High Aug 30
• RES 1: $95.17/98.75 - High Oct 12 / 10 and key near-term resistance
• PRICE: $92.27 @ 05:58 BST Oct 18
• SUP 1: $90.59 - 50.0% retracement of the Sep 26 - Oct 10 rally
• SUP 2: $88.67 - 61.8% retracement of the Sep 26 - Oct 10 rally
• SUP 3: $85.00/82.44 - Low Sep 30 / Low Sep 26 and the bear trigger
• SUP 4: $81.97 - 1.618 proj of the Jul 29 - Aug 5 - 30 price swing

Brent futures continue to trade closer to its recent lows. A bearish threat appears to have strengthened following recent price action. A break of $91.08, the Oct 13 low would signal scope for a continuation lower and this would open $88.67, a Fibonacci retracement. For bulls, a resumption of gains would instead pave the way for a climb towards the key resistance at $98.75, the Oct 10 high.

WTI TECHS: (X2) Bear Cycle Still In Play

• RES 4: $104.31 - 76.4% retracement of the Jun 8 - Sep 26 downleg
• RES 3: $98.95 - 61.8% retracement of the Jun 8 - Sep 26 downleg
• RES 2: $96.82 - High Aug 31
• RES 1: $90.07/93.64 - High Oct 12 / 10 and key resistance
• PRICE: $86.15 @ 07:06 BST Oct 18
• SUP 1: $84.61 - Low Oct 17
• SUP 2: $82.89 - 61.8% retracement points of the Sep 26 - Oct 10 rally
• SUP 3: $79.14 - Low Sep 30
• SUP 4: $76.25 - Low Sep 26 and the bear trigger

WTI futures traded lower again Monday. This reinstates a near-term bearish theme and highlights potential for a continuation lower. An extension would open $82.89, a Fibonacci retracement level. On the upside, a resumption of gains would instead suggest scope for a climb towards the key short-term resistance at $93.64, the Oct 10 high. Clearance of this level would strengthen a bullish theme.

GOLD TECHS: Trend Signals Remain Bearish

• RES 4: $1745.6 - High Sep 29
• RES 3: $1735.1 - High Sep 12 and a key resistance
• RES 2: $1729.5 - High Oct 4 and the bull trigger
• RES 1: $1684.0/1702.3 - High Oct 11 / 50-day EMA
• PRICE: $1654.7 @ 07:20 BST Oct 18
• SUP 1: $1640.2 - Low Oct 14
• SUP 2: $1615.0 - Low Sep 28 and the bear trigger
• SUP 3: $1610.5 - 1.00 proj of the Jun 13 - Jul 21 - Aug 10 swing
• SUP 4: $1569.1 - Low Apr 1 2020

Gold maintains a softer tone following the recent reversal from $1729.5, the Oct 4 high. The move lower signals the end of the bull phase between Sep 28 - Oct 4 and note that price has moved below the trendline resistance drawn from the Mar 8 high. An extension lower would expose the key support and bear trigger at $1615.0, the Sep 28 low. On the upside, a break of $1729.5 is required to reinstate a bullish theme.

SILVER TECHS: Remains Vulnerable

• RES 4: $21.967 - High Jun 17
• RES 3: $21.540 - High Jun 27
• RES 2: $20.187/21.242 - High Oct 10 / 4 and key resistance
• RES 1: $19.420 - 50-day EMA
• PRICE: $18.796 @ 08:09 BST Oct 18
• SUP 1: $17.967 - Low Sep 28
• SUP 2: $17.562 - Low Sep 1 and bear trigger
• SUP 3: $16.955 - Low Jun 15 2020
• SUP 4: $16.473 - 1.00 proj of the Jun 6 - Jul 14 - Aug 10 price swing

Silver remains vulnerable and last week’s move lower reinforced the bearish condition. The 50-day EMA has been cleared. This signals scope for a continuation of the current bear leg and has exposed the next support at $17.967, the Sep 28 low. Clearance of this support would open $17.562, the Sep 28 low and the bear trigger. Initial resistance is seen at $19.420, the 50-day EMA.