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Price Signal Summary - Time For A USDJPY Correction?

MARKET INSIGHT
  • In the equity space, S&P E-Minis traded higher Tuesday, extending the bull cycle that started Mar 15. Bullish conditions have also been reinforced by the recent break of both the 20- and 50-day EMAs. Resistance at 4578.50, Feb 9 high has been cleared. The break has opened 4663.50, Jan 18 high. EUROSTOXX 50 futures have cleared resistance at the 50-day EMA - today at 3863.40. This average represented an important resistance and the break higher confirms a resumption of the bull cycle that started Mar 7. Also, the move higher has confirmed a bull flag breakout on the daily chart. The focus is on 3965.50 next, the Feb 23 high.
  • In FX, EURUSD rallied Tuesday and is firmer today. The pair has traded above key near-term resistance of 1.1137, Mar 17 high. The break of this hurdle eases recent bearish threats and highlights a developing bullish theme. Note too that EURUSD has also traded above the 50-day EMA, at 1.1150. This average represents an equally important resistance. An extension higher would open 1.1232, 61.8% of the Feb 10-Mar 7 sell-off. GBPUSD traded sharply lower Monday, extending the pullback from 1.3298, Mar 23 high. Prices have this week breached 1.3120, the Mar 22 low and this opens 1.3000, Mar 15 low and the key support. Key resistance remains the 50-day EMA, at 1.3313. A break would signal a reversal. USDJPY is continuing to pull away from Monday’s high of 125.09 and has traded through initial support at 121.97, the Mar 28 low. The move is considered corrective and is beginning to allow a recent extreme overbought condition to unwind. An extension lower would open 120.95, the Mar 24 low ahead of the 120.00 handle.
  • On the commodity front, Gold traded lower Tuesday but did bounce off the day low. The outlook remains bearish though. Recent weakness has allowed an overbought condition to unwind. Key support is seen at the 50-day EMA, at $1903.4, just ahead of the Mar 15 low of $1895.3. Both were probed yesterday, a clear break would signal scope for a deeper pullback. Initial resistance is at $1966.1, Mar 24 high. In the Oil space, WTI traded lower yesterday but did find support at the day low. The move lower however confirms an extension of the reversal from last week’s high of $116.64 on Mar 24. The contract has also cleared the 20-day EMA, strengthening a bearish case and has opened the 50-day EMA at $96.75, a key support.
  • In the FI space, Bund futures remain bearish and the trend needle still points south. The focus is on a move to 156.00 next. The trend condition in Gilts remains bearish. Futures traded to a fresh cycle low Monday of 119.86. Gains are considered corrective and the focus is on 119.75, 123.6% of the Feb 15 - Mar 1 climb.
Fixed Income Technical AnalysisForeign Exchange Technical AnalysisHomepagemarkets-real-timeBulletMarketsFixed Income BulletsForeign Exchange Bullets
Fixed Income Technical AnalysisForeign Exchange Technical AnalysisHomepagemarkets-real-timeBulletMarketsFixed Income BulletsForeign Exchange Bullets

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