MNI DAILY TECHNICAL ANALYSIS - WTI Recovery Reinforces Importance of Nearby Support

Price Signal Summary – WTI Recovery Reinforces Importance of Nearby Support

• S&P e-minis maintain a softer tone and the contract continues to trade below resistance at the 50-day EMA, at 4482.75. A clear breach of this average is required to strengthen bullish conditions and this would open 4486.12, trendline resistance drawn from the Jul 27 high. A bearish theme in Eurostoxx 50 futures remains in play and this week’s move lower reinforces bearish conditions. The contract has traded through support at 4082.00, the Oct 4 low and a bear trigger.
• EURUSD is trading below its recent thighs. The trend condition remains bearish and the reversal lower from 1.0640, Oct 12 high, suggests the end of the recent corrective cycle. EURGBP traded higher Thursday and in the process breached key short-term resistance at 0.8706, the Sep 26 high and a bull trigger. The break confirms a resumption of the current bull cycle and reinforces the bullish importance of the recent break of trendline resistance. AUDUSD remains below Wednesday’s high. The trend outlook is bearish and attention is on 0.6286, the Oct 3 / 13 low. A clear break of this support and bear trigger, would confirm a resumption of the trend and open 0.6215.
• WTI futures traded higher yesterday and the contract remains firm. The latest recovery has highlighted a key support at $80.20, the Oct 6 low. The medium-term trend condition remains bullish and an extension higher would expose the bull trigger at $92.48. Gold has traded higher this week, extending the reversal from $1810.5, the Oct 6 low. The yellow metal has breached key resistance at $1953.0, the Sep 1 high. The clear break of this level further strengthens a bullish theme and opens $1987.5.
• Bund futures remain soft following this week’s move lower. The pullback from 130.20, the Oct 12 high highlights the end of the recent corrective recovery between Oct 4 - 12. Gilt futures traded lower yesterday and the contract maintains a bearish theme. Price gapped lower at yesterday’s open and in the process traded through key support at 91.47, the Aug 17 low.

EURUSD TECHS: Bearish Outlook

• RES 4: 1.0769 High Sep 12
• RES 3: 1.0737 High Sep 20
• RES 2: 1.0677 50-day EMA
• RES 1: 1.0640 High Oct 12
• PRICE: 1.0575 @ 06:15 BST Oct 20
• SUP 1: 1.0496/0448 Low Oct 13 / 03 and the bear trigger
• SUP 2: 1.0406 50.0% retracement of the Sep ‘22 - Jul ‘23 bull leg
• SUP 3: 1.0356 2.0% 10-dma envelope
• SUP 4: 1.0291 Low Nov 30 2022

EURUSD is trading below its recent thighs. The trend condition remains bearish and the reversal lower from 1.0640, Oct 12 high, suggests the end of the recent corrective cycle. The focus is on 1.0448, the Oct 3 low and a bear trigger. Clearance of this level would resume the downtrend and open 1.0406, a Fibonacci retracement. On the upside, a break of 1.0640, the Oct 12 high, is required to signal scope for a stronger correction.

GBPUSD TECHS: Trend Needle Points South

• RES 4: 1.2506 High Sep 14
• RES 3: 1.2444 200-dma
• RES 2: 1.2370 50-day EMA
• RES 1: 1.2226/2337 20-day EMA / High Oct 11 and the bull trigger
• PRICE: 1.2138 @ 06:33 Oct 20
• SUP 1: 1.2037/28 Low Oct 04 and bear trigger / Low Mar 16
• SUP 2: 1.2011 Low Mar 15 and a key support
• SUP 3: 1.1964 3.00 proj of the Jul 14 - 24 - 27 price swing
• SUP 4: 1.1908 Low Mar 10

The GBPUSD trend condition remains bearish. The reversal from recent highs signals the end of a corrective phase between Oct 4 - 11, and the continuation lower exposes the bear trigger at 1.2037, the Oct 4 low. Clearance of this level would confirm a resumption of the downtrend that started in July and open 1.1964, a Fibonacci projection. For bulls, a break of 1.2337, the Oct 11 high, would signal scope for a stronger corrective phase.

EURGBP TECHS: Clears Resistance

• RES 4: 0.8835 High May 3
• RES 3: 0.8793 61.8% retracement of the Feb 3 - Aug 23 downleg
• RES 2: 0.8768 High May 5
• RES 1: 0.8736 50.0% retracement of the Feb 3 - Aug 23 downleg
• PRICE: 0.8718 @ 06:46 BST Oct 20
• SUP 1: 0.8661 20-day EMA
• SUP 2: 0.8633/16 50-day EMA / Low Oct 11 and the bear trigger
• SUP 3: 0.8569 Low Sep 15 and a key support
• SUP 4: 0.8558 Low Sep 11

EURGBP traded higher Thursday and in the process breached key short-term resistance at 0.8706, the Sep 26 high and a bull trigger. The break confirms a resumption of the current bull cycle and reinforces the bullish importance of the recent break of trendline resistance, drawn from the Feb 3 high. Attention turns to 0.8736, a Fibonacci retracement. On the downside. Initial firm support is seen at 0.8655, the 20-day EMA.

USDJPY TECHS: Trading Just Below The Trend High

• RES 4: 151.95 High Oct 21 and a major resistance
• RES 3: 151.09 2.764 proj of the Jan 16 - Mar 8 - Mar 24 price swing
• RES 2: 150.40 2.618 proj of the Jan 16 - Mar 8 - Mar 24 price swing
• RES 1: 150.16 High Oct 3 and the bull trigger
• PRICE: 149.86 @ 06:56 BST Oct 20
• SUP 1: 149.08/147.43 20-day EMA / Low Oct 3 and key support
• SUP 2: 146.44 Low Sep 12
• SUP 3: 145.91 Low Sep 11
• SUP 4: 144.45 Low Sep 1

USDJPY continues to trade in a tight range just below its recent trend highs. The outlook is bullish and moving average studies continue to highlight positive market sentiment. Attention is on the 150.00 handle and the recent 150.16 high (Oct 3). A clear break of 150.00 would reinforce bullish conditions and open 150.40, a Fibonacci projection. On the downside, a breach of 147.43, Oct 3 low, would be an important bearish development.

EURJPY TECHS: Tests Initial Resistance

• RES 4: 160.36 2.382 proj of the May 11 - 29 - 31 price swing
• RES 3: 160.00 Psychological handle
• RES 2: 159.76 High Aug 30 and the bull trigger
• RES 1: 158.93 High Oct 19
• PRICE: 158.47 @ 07:08 BST Oct 20
• SUP 1: 156.46/154.46 Low Oct 6 / Oct 3 and the bear trigger
• SUP 2: 153.39 76.4% of the Jul 28 - Aug 30 bull run
• SUP 3: 151.42 Late July Low and Bear Trigger
• SUP 4: 150.00 Round number support

EURJPY remains inside a range but did trade higher yesterday. Resistance to watch is 158.65, the Sep 13 high. This hurdle was pierced yesterday, a clear breach of it would highlight a range breakout and expose the key resistance and bull trigger at 159.76, the Aug 30 high. On the downside, key support is unchanged at 154.46, the Oct 3 low. Clearance of this level would instead strengthen a bearish case and open 153.39, a Fibonacci retracement.

AUDUSD TECHS: Trend Outlook Remains Outlook

• RES 4: 0.6616 High Aug 16
• RES 3: 0.6522 High Aug 30 and Sep 1, and the key resistance
• RES 2: 0.6445/6501 High Oct 11 / High Sep 29
• RES 1: 0.6393 High Oct 18
• PRICE: 0.6310 @ 07:55 BST Oct 20
• SUP 1: 0.6286 Low Oct 3 / 13 and the bear trigger
• SUP 2: 0.6272 Low Nov 3 2022 and a key support
• SUP 3: 0.6215 2.236 proj of the Jun 16 - Jun 29 - Jul 13 price swing
• SUP 4: 0.6170 Low Oct 13 2022 and a key support

AUDUSD remains below Wednesday’s high. The trend outlook is bearish and attention is on 0.6286, the Oct 3 / 13 low. A clear break of this support and bear trigger, would confirm a resumption of the trend and open 0.6215, a Fibonacci projection. Key trend resistance is unchanged at 0.6522, the Aug 30 and Sep 1 high. A break is required to highlight a reversal. Initial resistance is at 0.6393, the Oct 18 high.

USDCAD TECHS: Bullish Trend Structure Remains In Place

• RES 4: 1.3920 2.0% 10-dma envelope
• RES 3: 1.3862 High Mar 10 and a key resistance
• RES 2: 1.3805 High Mar 24
• RES 1: 1.3786 High Oct 5 and the bull trigger
• PRICE: 1.3714 @ 07:59 BST Oct 20
• SUP 1: 1.3569 Low Oct 10
• SUP 2: 1.3559 50-day EMA
• SUP 3: 1.3417 Low Sep 29
• SUP 4: 1.3381 Low Sep 19 and a key support

The USDCAD trend outlook is unchanged and remains bullish. The pair remains above the 20- and 50-day EMAs. The 50-day average intersects at 1.3559 and marks a key short-term support. A clear break of this average would signal scope for a deeper correction. Sights are on 1.3786, the Oct 5 high. Clearance of this level would confirm a resumption of the uptrend and open 1.3862, the Mar 10 high.

FIXED INCOME

BUND TECHS: (Z3) Bearish Outlook

• RES 4: 131.49 High Sep 14
• RES 3: 131.33 76.4% retracement of the Sep 1 - Oct 4 downleg
• RES 2: 130.43 61.8% retracement of the Sep 1 - Oct 4 downleg
• RES 1: 128.74/130.20 20-day EMA / High Oct 12 and a bull trigger
• PRICE: 127.81 @ 05:48 BST Oct 20
• SUP 1: 127.21 Low Oct 10
• SUP 2: 126.62 Low Oct 4 and the bear trigger
• SUP 3: 126.00 Round number support
• SUP 4: 125.49 0.764 proj of the Sep 1 - Oct 4 - Oct 12 price swing

Bund futures remain soft following this week’s move lower. The pullback from 130.20, the Oct 12 high highlights the end of the recent corrective recovery between Oct 4 - 12. Note that the medium-term trend direction is down and moving average studies reflect this. A continuation lower would open 126.62, the Oct 4 low and bear trigger. Key short-term resistance and a bull trigger has been defined at 130.20.

BOBL TECHS: (Z3) Key Support Remains Exposed

• RES 4: 116.740 High Sep 14
• RES 3: 116.567 61.8% retracement of the Sep 1 - Sep 28 downleg
• RES 2: 116.500 High Oct 10 and the short-term bull trigger
• RES 1: 115.810 20-day EMA
• PRICE: 115.440 @ 05:52 BST Oct 20
• SUP 1: 115.070 Low Oct 4
• SUP 2: 114.880 Low Sep 28 and the bear trigger
• SUP 3: 114.710 Low Aug 15 (cont)
• SUP 4: 114.414 0.764 proj of the Sep 1 - 28 - Oct 12 price swing

Bobl futures are trading closer to their recent lows. This week’s sell-off strengthens the latest reversal and undermines the recent bullish theme. A continuation lower would signal scope for weakness towards key support and the bear trigger at 114.880, the Sep 28 low. Clearance of this level would further strengthen bearish conditions. Key short-term resistance and a bull trigger has been defined at 116.500, the Oct 10 high.

SCHATZ TECHS: (Z3) Key Support Remains Exposed

• RES 4: 105.440 High Sep 4
• RES 3: 105.372 76.4% Fibonacci retracement Sep 1 - 21 downleg
• RES 2: 105.190/105.320 High Oct 12 / 10 and the bull trigger
• RES 1: 105.013 20-day EMA
• PRICE: 104.910 @ 06:01 BST Oct 20
• SUP 1: 104.780 Low Sep 28
• SUP 2: 104.765 Low Sep 21 and the bear trigger
• SUP 3: 104.720 2.00 proj of the Aug 24 - 30 - Sep 1 price swing
• SUP 4: 104.620 Low Jul 11 (cont)

Schatz futures have traded lower this week and remain below resistance at 105.320, the Oct 10 high and a short-term bull trigger. The move below support at 105.035, the Oct 10 low, strengthened a bearish theme and has exposed the key support at 104.765, Sep 21 low. A break of this level would confirm a resumption of the medium-term downtrend. Initial resistance is at 105.013, the 20-day EMA.

GILT TECHS: (Z3) Trades Through Key Support

• RES 4: 96.05 High Sep 25
• RES 3: 95.66 High Oct 12 and the bull trigger
• RES 2: 93.52/94.28 20-day EMA / High Oct 16
• RES 1: 92.98 High Oct 18
• PRICE: 91.29 @ Close Oct 19
• SUP 1: 91.19 Low Oct 19
• SUP 2: 90.38 Low Oct 12 2022 (cont) and a major support
• SUP 3: 90.00 Psychological round number
• SUP 4: 89.22 1.236 proj of the Sep 20 - Oct 4 - Oct 12 price swing

Gilt futures traded lower yesterday and the contract maintains a bearish theme. Price gapped lower at yesterday’s open and in the process traded through key support at 91.47, the Aug 17 low. This confirms a resumption of the downtrend and paves the way for a move towards 90.38, the Oct 12 2022 low (cont) and a major support. Initial firm resistance is at 93.52, the 20-day EMA.

BTP TECHS: (Z3) Pierces Key Support

• RES 4: 113.69 76.4% retracement of the Aug 24 - Oct 4 bear leg
• RES 3: 112.53 61.8% retracement of the Aug 24 - Oct 4 bear leg
• RES 2: 111.59 50.0% retracement of the Aug 24 - Oct 4 bear leg
• RES 1: 109.66/111.17 20-day EMA / High Oct 12 and key resistance
• PRICE: 108.10 @ Close Oct 19
• SUP 1: 107.42 Low Oct 19
• SUP 2: 107.08 2.236 proj of the Jun 26 - Jul 11 - 19 price swing (cont)
• SUP 3: 106.40 2.382 proj of the Jun 26 - Jul 11 - 19 price swing (cont)
• SUP 4: 105.85 2.50 proj of the Jun 26 - Jul 11 - 19 price swing (cont)

BTP futures traded to a fresh cycle low yesterday as the contract extends the reversal from 111.17, the Oct 12 high. Price has pierced key support at 107.62, the Oct 4 low. A clear break of this level would confirm a resumption of the long-term downtrend and open 107.08, a Fibonacci projection. 111.17 marks the key resistance. Clearance of this level is required to highlight a possible short-term reversal.

EQUITIES

EUROSTOXX50 TECHS: (Z3) Clears Support

• RES 4: 4359.00 High Sep 15 and key resistance
• RES 3: 4300.00 Round number resistance
• RES 2: 4236.40/4256.00 50-day EMA / High Oct 12
• RES 1: 4178.80 20-day EMA
• PRICE: 4074.00 @ 06:26 BST Oct 20
• SUP 1: 4082.00 Low Oct 4 and the bear trigger
• SUP 2: 4055.40 76.4% retracement of the Mar 20 - Jul 31 bull cycle
• SUP 3: 4034.00 Low Mar 24 (cont)
• SUP 4: 4000.00 Psychological round number

A bearish theme in Eurostoxx 50 futures remains in play and this week’s move lower reinforces bearish conditions. The contract has traded through support at 4082.00, the Oct 4 low and a bear trigger. This confirms a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. The focus is on 4055.40, a Fibonacci retracement. Initial resistance is at 4178.80, the 20-day EMA.

E-MINI S&P TECHS: (Z3) Trend Structure Remains Bearish

• RES 4: 4566.00 High Sep 15 and a key resistance
• RES 3: 4514.50 High Sep 18
• RES 2: 4482.75 Trendline resistance drawn from the Jul 27 high
• RES 1: 4417.54/4430.50 50+-day EMA / High Oct 12
• PRICE: 4289.00 @ 07:20 BST Oct 20
• SUP 1: 4235.50 Low Oct 4 and the bear trigger
• SUP 2: 4194.75 Low May 24
• SUP 3: 4166.25 1.50 proj of the Jul 27 - Aug 18 - Sep 1 price swing
• SUP 4: 4134.00 Low May 4

S&P e-minis maintain a softer tone and the contract continues to trade below resistance at the 50-day EMA, at 4482.75. A clear breach of this average is required to strengthen bullish conditions and this would open 4486.12, trendline resistance drawn from the Jul 27 high. On the downside, a deeper pullback would open 4235.50, the Oct 4 low and bear trigger. A break of this support would confirm a resumption of the downtrend.

COMMODITIES

BRENT TECHS: (Z3) Bull Cycle Still In Play

• RES 4: $99.73 - 1.236 proj of Jun 23 - Aug 10 - Aug 24 price swing
• RES 3: $96.22 - 1.00 proj of Jun 23 - Aug 10 - Aug 24 price swing
• RES 2: $95.35 - High Sep 28 and the bull trigger
• RES 1: $93.48 - High Oct 19
• PRICE: $93.30 @ 07:13 BST Oct 20
• SUP 1: $87.91/83.44 - 50-day EMA / Low Oct 6 and bear trigger
• SUP 2: $82.80 - 50.0% retracement of the May 4 - Sep 28 bull run
• SUP 3: $81.33 - Low Aug 24
• SUP 4: $79.84 - 61.8% retracement of the May 4 - Sep 28 bull run

Brent futures have continued to appreciate this week and the contract maintains a firmer tone. The latest recovery has defined a key support at $83.44, Oct 6 low. The medium-term trend condition is bullish and the continuation higher exposes the bull trigger at $95.35, Sep 28 high. Clearance of this hurdle would confirm a resumption of the uptrend. For bears, a break of $83.44, would highlight potential for a stronger bear cycle.

WTI TECHS: (Z3) Outlook Remains Bullish

• RES 4: $98.27 - 1.382 proj of the Jun 28 - Aug 10 - 24 price swing
• RES 3: $96.03 - 1.236 proj of the Jun 28 - Aug 10 - 24 price swing
• RES 2: $92.48 - High Sep 28 and a bull trigger
• RES 1: $89.58 - 76.4% retracement of the Sep 28 - Oct 6 bear leg
• PRICE: $89.410 @ 07:10 BST Oct 20
• SUP 1: $83.90/80.20 - 50-day EMA / Low Oct 6
• SUP 2: $77.74 - 50.0% retracement of the May 4 - Sep 28 bull run
• SUP 3: $75.47 - Low Jul 24
• SUP 4: $74.26 - 61.8% retracement of the May 4 - Sep 28 bull run

WTI futures traded higher yesterday and the contract remains firm. The latest recovery has highlighted a key support at $80.20, the Oct 6 low. The medium-term trend condition remains bullish and an extension higher would expose the bull trigger at $92.48, the Sep 28 high. Clearance of this hurdle would confirm a resumption of the uptrend. For bears, a move through $80.20, would instead highlight a short-term top.

GOLD TECHS: Bull Cycle Extends

• RES 4: $2022.2 - High May 15
• RES 3: $2003.4 - 76.4% retracement of the May 4 - Oct 6 bear leg
• RES 2: $1987.5 - High Jul 20
• RES 1: $1982.4 - Intraday high
• PRICE: $1977.1 @ 06:24 BST Oct 20
• SUP 1: $1945.3/1904.7 - Low Oct 19 / 50-day EMA
• SUP 2: $1868.8 - Low Oct 13
• SUP 3: $1844.3 - Low Oct 9
• SUP 4: $1810.5 - Low Oct 6 and a key support

Gold has traded higher this week, extending the reversal from $1810.5, the Oct 6 low. The yellow metal has breached key resistance at $1953.0, the Sep 1 high. The clear break of this level further strengthens a bullish theme and opens $1987.5, the Jul 20 high. Initial firm pivot support lies at $1904.7, the 50-day EMA. Clearance of this level is required to signal a short-term top and a potential reversal.

SILVER TECHS: Corrective Cycle Still In Play

• RES 4: $25.014 - High Aug 30
• RES 3: $24.298 - High Sep 4
• RES 2: $23.774 - High Sep 22 and a key resistance
• RES 1: $23.323 - High Oct 18
• PRICE: $22.989 @ 08:17 BST Oct 20
• SUP 1: $21.573/20.689 - Low Oct 9 / 3 and the bear trigger
• SUP 2: $20.000 - Round number support
• SUP 3: $19.904 - Low Mar 10 and a key support
• SUP 4: $19.585 - 76.4% retracement of the Sep ‘22 - May ‘23 upleg

Silver trend conditions are bearish, however, for now a corrective cycle is in play. The metal has traded through both the 20- and 50-day EMAs. The breach of the 50-day average, at $22.795, strengthens bullish conditions. The move higher has opened $23.774, the Sep 22 high. For bears, a reversal lower and a break of $20.689, the Oct 3 low, would confirm a resumption of the downtrend.