MNI DAILY TECHNICAL ANALYSIS - WTI Extends Bullish Underlying Trend

Price Signal Summary – WTI Extends Bullish Underlying Trend

• In the equity space, S&P E-minis continue to climb, registering fresh all-time highs. The focus is on 4591.25, a Fibonacci projection. Trend signals such as moving average studies remain in a bull mode and this reinforces current trend conditions. EUROSTOXX 50 futures broke out of its recent range Friday. The outlook remains bullish following the breach of its 50-day EMA and this, together with the break of a number of resistance points has exposed 4200.50, the Sep 24 high.
• In FX, a consolidative tone in EUR/USD continues to dominate though and recent price action appears to be a bull flag. If correct, the pattern signals scope for an extension higher with the focus on the 50-day EMA at 1.1691. The pullback in GBP/USD appears to be a shallow correction and this reinforces a bullish theme. The rally from late September remains intact and the recent breach of the 50-day EMA and last week's extension signals scope for further gains. USD/JPY maintains a bullish tone and the recent pullback is considered corrective. Scope is seen for a climb towards 114.99, 1.50 projection of the Apr 23 - Jul 2 - Aug 4 price swing. Initial support is at 112.81, the 20-day EMA.
• On the commodity front, Gold maintains a positive short-term tone. The yellow metal has cleared resistance at $1800.6, Oct 14 high and this highlights a short-term bullish theme and has removed recent bearish concerns. WTI trend conditions remain bullish and futures started the week on a firm note. Fresh trend highs maintain the bullish price sequence of higher highs and higher lows, reinforcing the uptrend.
• In the FI space, trend conditions remain bearish and short-term gains are considered corrective. Bund futures sights are set on 167.79 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low (cont). With momentum and moving average conditions in Gilt futures still pointing south, fresh bearish pressure would open 123.16 next, the Feb 27, 2019 low.

FOREIGN EXCHANGE

EURUSD TECHS: Consolidation Mode

• RES 4: 1.1821 High Sep 16
• RES 3: 1.1721/55 Bear channel from Jun 1 high / High Sep 22
• RES 2: 1.1691 50-day EMA
• RES 1: 1.1669 High Oct 19
• PRICE: 1.1603 @ 06:08 BST Oct 26
• 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: 1.1386 Bear channel base drawn from the Jun 1 high

EURUSD traded lower yesterday. A consolidative tone continues to dominate though and recent price action action appears to be a bull flag. If correct, the pattern signals scope for an extension higher with the focus on the 50-day EMA at 1.1691. Note there is a key resistance at 1.1721, the top of a bear channel drawn from the Jun 1 high. Broader trend conditions remain bearish and recent gains are considered corrective. Key support is 1.1524.

GBPUSD TECHS: Corrections Remain Shallow

• RES 4: 1.3983 High Jul 30
• RES 3: 1.3958 High Aug 4
• RES 2: 1.3913 High Sep 14 and a key resistance
• RES 1: 1.3835 High Oct 20
• PRICE: 1.3761 @ 06:26 BST Oct 26
• SUP 1: 1.3707 20-day EMA
• SUP 2: 1.3655 Low Oct 14
• SUP 3: 1.3544 Low Oct 6
• SUP 4: 1.3459/12 2.0% 10-dma env / Low Sep 29 and bear trigger

GBPUSD is trading below recent highs. The pullback appears to be a shallow correction and this reinforces a bullish theme. The rally from late September remains intact and the recent breach of the 50-day EMA and last week's extension signals scope for further gains. Price has traded above 1.3795, 76.4% of the Sep 14 -29 downleg. The focus is on 1.3913, Sep 14 high and a key resistance. A firm S/T support is at 1.3707, the 20-day EMA.

EURGBP TECHS: Consolidating Near Recent Lows

• RES 4: 0.8624/58 High Oct 1 / High Sep 29
• RES 3: 0.8519 50-day EMA
• RES 2: 0.8518 High Oct 12 and a firm resistance
• RES 1: 0.8483 20-day EMA
• PRICE: 0.8432 @ 06:36 BST Oct 26
• SUP 1: 0.8422 Low Oct 21/22
• SUP 2: 0.8369 1.0% 10-dma envelope
• SUP 3: 0.8356 Low Feb 26, 2020
• SUP 4: 0.8339 Low Feb 25, 2020

EURGBP is trading in a range and above recent lows. The outlook remains bearish and corrections have been shallow reinforcing current conditions. Furthermore, moving average studies remain in a bear mode, highlighting a downtrend. 0.8450, Oct 10 low and a key support has recently been cleared. This opens 0.8369 next, a vol based support and 0.8356, the Feb 26, 2020 low. Initial firm resistance is 0.8518.

USDJPY TECHS: Trend Signals Still Point North

• RES 4: 116.08 1.764 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 3: 115.51 High Mar 10, 2017
• RES 2: 114.99 1.50 proj of Apr 23 - Jul 2 - Aug 4 price swing
• RES 1: 114.70/73 High Oct 20 / High Nov 6, 2017
• PRICE: 113.98 @ 06:12 BST Oct 26
• SUP 1: 112.89 20-day EMA
• 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

Recent USDJPY dips are considered corrective and bullish trend conditions remain intact. A recent key bullish technical development has been the confirmed breach of a long-term trendline (at 113.41) drawn off the Dec 1975 high. The trend higher has accelerated and momentum and MA studies continue to point north. Attention is on 114.99 next, a Fibonacci projection. Initial firm support is seen at 112.08, Sep 30 high and a recent breakout level.

EURJPY TECHS: Corrective Cycle

• 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: 133.76 High Jun 10
• RES 1: 133.48 High Oct 20
• PRICE: 132.19 @ 06:41 BST Oct 26
• SUP 1: 131.81/131.26 Low Oct 15 / 20-day EMA
• SUP 2: 130.75 Sep 3 high
• SUP 3: 130.50 50-day EMA
• SUP 4: 129.28 Low Oct 11

EURJPY is off recent highs and short-term weakness is still considered corrective. Last week's climb confirmed an extension of the upleg that started Oct 6. The cross has also recently cleared 130.75, the Sep 3 high bull trigger and underlying momentum conditions remain bullish. The focus is on 133.76 next, Jun 10 high and key resistance at 134.13, Jun 1 high. Initial support is at 131.81, Oct 15 low. The 20-day EMA, as support, intersects at 131.26.

AUDUSD TECHS: Bullish Focus

• RES 4: 0.7716 High Jun 16
• RES 3: 0.7630 1.236 proj of the Aug 20 - Sep 3 - Sep 29 price swing
• RES 2: 0.7599 High Jul 6
• RES 1: 0.7546/57 High Oct 21 / 50.0% of the Feb - Aug sell-off
• PRICE: 0.7505 @ 06:45 BST Oct 26
• SUP 1: 0.7454 Low Oct 22
• SUP 2: 0.7392/65 20-day EMA / 50-day EMA
• SUP 3: 0.7288 Low Oct 8
• SUP 4: 0.7226/7170 Low Oct 6 / Low Sep 29

AUDUSD maintains a firmer short-term tone and is trading near recent highs. 0.7478, the Sep 3 high and an important short-term bull trigger has been cleared. The breach of this hurdle strengthens a bullish case and confirms a positive price sequence of higher highs and higher lows - the current bull phase started August 20. This has opened 0.7599 next, the Jul 6 high. Firm support is seen at 0.7365, the 50-day EMA.

USDCAD TECHS: Bear Flag

• RES 4: 1.2648 High Oct 6
• RES 3: 1.2531 50-day EMA
• RES 2: 1.2494 Low Sep 3 and a recent breakout level
• RES 1: 1.2410 High Oct 18
• PRICE: 1.2384 @ 06:57 BST Oct 26
• SUP 1: 1.2288 Low Oct 21
• 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

USDCAD continues to consolidate and recent price action appears to be a bear flag - the trend conditions remain bearish. This follows the recent break of the Jul 30 low of 1.2422 and has opened 1.2253 next, the Jun 23 low. Note too that moving average conditions remain in a bear mode, reinforcing current trend conditions. Initial firm resistance is seen at 1.2494, Sep 3 low. A break would ease bearish pressure.

FIXED INCOME

BUND TECHS: (Z1) Needle Still Points South

• RES 4: 171.72 High Sep 23
• RES 3: 170.42 50-day EMA
• RES 2: 170.55 High Oct 4
• RES 1: 169.34/92 20-day EMA / High Oct 14 and key resistance
• PRICE: 168.45 @ 05:18 BST Oct 26
• SUP 1: 167.79 2.50 proj of the Sep 9 - 17 - 21 price swing
• SUP 2: 167.52 Low Mar 19 2020
• SUP 3: 166.33 Low May 21 2019
• SUP 4: 165.94 Low May 10 2019

Bund futures continue to trade above recent lows. The contract remains in a downtrend though. The break last week of 168.21, Oct 12 low marks a resumption of the bear trend and opens 167.79 next, a Fibonacci projection and 167.52, the Mar 19, 2020 low (cont). Moving average signals continue to point south, reinforcing current trend conditions and key trend resistance is seen at 169.92, the Oct 14 high. A break would signal a reversal.

BOBL TECHS: (Z1) Bounce Considered Corrective

• RES 4: 135.200 Low Sep 17, high Oct 4 and recent breakout level
• RES 3: 135.060 High Oct 7
• RES 2: 134.860 High Oct 14 and key resistance
• RES 1: 134.614 20-day EMA
• PRICE: 134.240 @ 05:21 BST Oct 26
• SUP 1: 133.800 Low Feb 26 and a key support
• SUP 2: 133.772 1.236 proj of the Oct 4 - 13 - 14 price swing
• SUP 3: 133.340 Low Mar 19 and key medium-term support
• SUP 4: 133.308 1.764 proj of the Oct 4 - 13 - 14 price swing

Bobl futures remain bearish and short-term gains are considered corrective. Last week's sell-off confirmed a resumption of the underlying downtrend and reinforces bearish conditions. Key short-term trend resistance has been defined at 134.860, Oct 14 high and a breach of this level is required to signal scope for a short-term reversal. With momentum still pointing south, the focus is on 133.772 next, a Fibonacci projection.

SCHATZ TECHS: (Z1) Retracement Mode

• 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: 112.165 20-day EMA
• PRICE: 112.145 @ 05:35 BST Oct 26
• SUP 1: 112.025 2.00 proj of the Sep 20 - 28 - Oct 5 price swing
• SUP 2: 112.00 Round number support
• 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 although recent price action has been volatile and a corrective phase has dominated since Oct 20. Fresh lows last week reinforce the downtrend and confirm a resumption of the downtrend that maintains the bearish price sequence of lower lows and lower highs. The focus is on 112.025 next, a Fibonacci projection. On the upside, initial resistance is at 112.165, the 20-day EMA.

GILT TECHS: (Z1) Bear Trend Remains Intact

• RES 4: 126.84 Low Sep 17
• RES 3: 126.44 High Sep 24
• RES 2: 125.72 High Oct 1
• RES 1: 124.77/125.27 20-day EMA / High Oct 14 and key resistance
• PRICE: 124.21 @ Close Oct 25
• SUP 1: 123.43 Low Oct 21 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 in a downtrend and last week's fresh trend low of 123.43, on Oct 21, confirmed a resumption of the downtrend. With momentum and moving average conditions still pointing south, fresh bearish pressure would open 123.16 next, the Feb 27, 2019 low. A break of the 123.00 handle is also likely near-term. Key resistance has been defined at 125.27, the Oct 14 high. A break would signal a short-term reversal.

BTP TECHS: (Z1) Trend Signals Remain Bearish

• RES 4: 154.64 High Sep 22 / 23
• RES 3: 153.59 High Sep 24
• RES 2: 152.54/87 High Oct 14 and key resistance / High Oct 1
• RES 1: 151.81 20-day EMA
• PRICE: 151.29 @ Close Oct 25
• SUP 1: 150.38 Low Oct 22
• SUP 2: 150.00/149.97 Round number support / Low Jun 25
• SUP 3: 149.76 0.764 proj of the Sep 23 - Oct 6 - 14 price swing
• SUP 4: 148.77 61.8% retracement of the May - Aug rally (cont)

BTP futures outlook remains bearish and last week's move lower confirmed a resumption of the trend. A key short-term resistance has been defined at 152.54, Oct 14 high where a break is required to signal a short-term base. With trend signals such as momentum and moving average studies still pointing south, a resumption of weakness would open the 150.00 handle next. A break of this level is also seen likely further out. 151.81 is resistance.

EQUITIES

EUROSTOXX 50 TECHS: (Z1) Approaching Resistance

• RES 4: 4385.00 1.236 proj of Mar 19- Jul 21-Oct 30 2020 swing (cont)
• RES 3: 4290.50 1.00 proj of the Jul 19 - Sep 6 - Oct 6 price swing
• RES 2: 4223.00 High Sep 6 and the bull trigger
• RES 1: 4200.50 High Sep 24
• PRICE: 4185.00 @ 06:00 BST Oct 26
• SUP 1: 4109.30 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 recent gains - the contract broke out of its recent range Friday. The outlook remains bullish following the breach of its 50-day EMA and this, together with the break of a number of resistance points has exposed 4200.50, the Sep 24 high. Above 4200.50 is the major resistance and bull trigger at 4223.00, Sep 6 high. On the downside, the 50-day EMA, at 4109.30 today, marks initial support.

E-MINI S&P (Z1): Fresh All-Time Highs Once Again

• RES 4: 4650.60 1.236 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 1: 4600.00 Round number resistance
• RES 3: 4591.25 1.00 proj of Jul 19 - Aug 16 - Aug 19 price swing
• RES 1: 4572.00 Intraday high
• PRICE: 4567.25 @ 07:01 BST Oct 26
• SUP 1: 4472.00 High Sep 27 and a recent breakout level
• SUP 2: 4409 06 50-day EMA
• SUP 3: 4317.25/4260.00 Low Oct 12 / Low Oct 1 and the bear trigger
• SUP 4: 4243.50 Low Jul 20

S&P E-minis continue to climb, registering fresh all-time highs. This confirms a resumption of the uptrend and paves the way for an extension. The focus is on 4591.25, a Fibonacci projection. Trend signals such as moving average studies remain in a bull mode and this reinforces current trend conditions. A key support is at 4317.25, Oct 12 low. The 50-day EMA at 4419.70 represents an initial firm support handle.

COMMODITIES

BRENT TECHS: (Z1) Fresh Trend High

• RES 4: $90.93 - 2.236 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 3: $90.00 - Psychological round number
• RES 2: $88.74 - 2.00 proj of the Aug 23 - Sep 3 - Sep 9 price swing
• RES 1: $86.70/87.00 - High Oct 25 / Round number resistance
• PRICE: $85.97 @ 07:00 BST Oct 26
• SUP 1: $83.36 - Low Oct 21
• SUP 2: $82.55/20 - 20-day EMA / Low Oct 13
• SUP 3: $79.08/78.75 - Low Oct 7 and key support / Low Oct 4
• SUP 4: $76.51/75.42 - Low Sep 30 and key support / High Sep 15

The bull trend in Brent futures remains intact and the contract started the week on a firm note. Fresh highs once again yesterday confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies remain in a bull mode The focus is on $87.00 next. Initial firm short-term support is seen at $82.55, the 20-day EMA.

WTI TECHS: (Z1) Heading North

• RES 4: $88.96 - 1.382 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 3: $87.45 - 1.236 proj of the Sep 21 - Oct 6 - 7 price swing
• RES 2: $86.00 - Round number resistance
• RES 1: $85.41 - High Oct 25
• PRICE: $83.65 @ 07:03 BST Oct 26
• SUP 1: $80.78 - Low Oct 20
• SUP 2: $79.62/78.78 - 20-day EMA / Low Oct 13
• SUP 3: $74.67 - Low Oct 7 and key near-term support
• SUP 4: $73.92 - Low Oct 1

WTI trend conditions remain bullish and futures started the week on a firm note. Fresh trend highs maintain the bullish price sequence of higher highs and higher lows, reinforcing the uptrend. Note that the $80.00 psychological hurdle has also recently been cleared, an important break. The focus is on $86.00 next. On the downside, a firm short-term support has been defined at $80.78, Oct 20 low.

GOLD TECHS: Positive Short-Term Tone

• RES 4: $1863.3 - 76.4% retracement of the Jun - Aug sell-off
• RES 3: $1844.9 - Low Jun 14
• RES 2: $1834.0 - High Sep 3 and the bull trigger
• RES 1: $1813.8 - High Oct 22 and key short-term resistance
• PRICE: $1805.7 @ 07:18 BST Oct 26
• SUP 1: $1776.1/1760.4 - 50-day EMA / Low Oct 18
• 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 maintains a positive short-term tone. The yellow metal has cleared resistance at $1800.6, Oct 14 high and this highlights a short-term bullish theme and has removed recent bearish concerns. Further gains would open $1834.0, the Sep 3 high. On the downside, a key short-term support has been defined at $1760.4, the Oct 18 low. A break would alter the picture and suggest scope for a deeper pullback.

SILVER TECHS: Bullish Conditions Intact

• RES 4: $26.002 - High Aug 4
• RES 3: $25.206 - High Jun 8
• RES 2: $24.867 - High Sep 3 and the reversal trigger
• RES 1: $24.828 - High Oct 22
• PRICE: $24.438 @ 07:22 BST Oct 26
• SUP 1: $23.015 - Low Oct 18
• SUP 2: $22.213 - Low Oct 6
• SUP 3: $21.423 - Low Sep 29 and key support
• SUP 4: $20.871 - 50.0% retracement of the Mar '20 - Feb '21 rally

The current bull cycle in Silver remains intact. The metal has recently cleared both the 20- and 50 day EMAs. The extension higher paves the way for $24.867, the Sep 3 high and a key near-term resistance. Clearance of this hurdle would strengthen the case for bulls and open the $26.00 handle. Initial firm support to watch is at $23.015, Oct 18 low. A break would threaten the current bullish theme.