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Price Signal Summary - Equities on the Backfoot

  • In the equity space, S&P E-minis are running against the previously strong bullish tone, slipping below the Tuesday low in early trade. Bulls need the dominant buy-the-dip strategy to return to keep focus on round number resistance at 4400.00. Watch support at 4270.00, the 20-day EMA. EUROSTOXX 50 (U1) futures have sold off this morning. The contract has cleared 4015.00, Jun 21 low. The break lower strengthens a bearish case and reinforces the bearish engulfing candle reversal on Jun 21. This opens 3914.00, the May 20 low.
  • In FX, the USD outlook remains bullish. EURUSD traded lower yesterday and cleared the recent lows of 1.1807/8. This confirms an extension of the downtrend and opens 1.1704, Mar 31 low. This morning's gains are considered corrective. The GBPUSD focus is on 1.3733, Jul 2 low that would open 1.3717, Apr 16 low. Resistance is at 1.3898, the weekly high. This week's bout of risk-off has worked against USDJPY. Today's move lower has resulted in a test of the 50-day EMA at 109.88. A clear break would expose the Jun 21 low at 109.72 and 109.19/14, the Jun 7 low and the 100-dma.
  • On the commodity front, Gold maintains a firmer tone. Attention is on the 50-day EMA that intersects at $1814.6. A clear break of the EMA is required to suggest scope for a stronger rally. This would open $1833.7, 50.0% of the Jun 1 - 29 decline. Brent (U1) continues to trade lower with the focus on $71.24, the Jun 17 low. WTI (Q1) has cleared its 20-day EMA and attention turns to $69.54, Jun 17 low.
  • Within FI, Bund futures are stronger having cleared resistance at 173.16, Jun 11 high. Scope is for a climb to 174.97 next, Mar 3 high (cont). Gilt futures have topped key resistance at 128.39, Jun 11 high, strengthening the bullish case. This has opened 129.99, the Feb 24 high (cont).

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