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Late Equity Roundup: Mildly Lower on Week


Remains Above The 50-Day EMA

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  • In the equity space, S&P E-minis traded lower again yesterday. The move this week has resulted in a break of key support at 4485.75, Dec 3 low. This significantly strengthens the current bearish case and signals potential for an extension lower towards 4383.85, 76.4% retracement of the Oct 2021 - Jan rally. EUROSTOXX 50 futures have probed support at 4216.50, the Jan 10 low. This level has held for now and support has again surfaced below the 50-day EMA. A clear break of 4216.50 would trigger a resumption of bearish pressure and open 4161.80, 61.8% retracement of the Dec 20 - Jan 5 rally.
  • In FX, EURUSD remains vulnerable. The move lower this week, threatens the recent bullish theme and suggests that the recent range and bear channel breakout appears to have been a false one. Further weakness would expose 1.1272, the Jan 4 low. GBPUSD trend conditions are bullish however the pair remains in a bearish corrective cycle. The support to watch is at 1.3558, the 20-day EMA where a clear break would signal potential for a deeper sell-off. The 200-dma, at 1.3734 marks an important resistance. A clear break of it would open 1.3835, Oct 20 high. USDJPY remains above the Jan 14 low 113.49. The bullish doji candle pattern on Jan 14 continues to highlight a reversal and signals the end of the recent corrective pullback. A resumption of gains would open 115.68, Jan 11 high. Sub 113.49 levels would be bearish.
  • On the commodity front, Gold traded sharply higher Wednesday. This resulted in a break of resistance at $1831.9, Jan 3 high and a bull trigger. The outlook is bullish and attention is on $1848.0 next, 76.4% retracement of the Nov 16 - Dec 15 downleg. WTI futures remain in an uptrend and the most recent pullback is likely a correction. Key support to watch is at $83.52, the Jan 12 low. A resumption of gains would refocus attention on $87.47, 2.00 projection of the Dec 2 - 9 - 20 price swing.
  • In the FI space, Bund futures remain in a downtrend and short-term gains are considered corrective. Key short-term resistance is seen at 171.00, Jan 13 high. The bear trigger is 168.95, Jan 19 low. Gilts remain in a downtrend too. Key short-term resistance has been defined at 123.79, Jan 13 high. A break is required to signal a base. The bear trigger is 121.93, Jan 19 low.
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