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Price Signal Summary - USDJPY Bull Cycle Extends

OUTLOOK
  • In the equity space, S&P E-Minis activity is trading closer to recent lows. The contract remains in a downtrend and any short-term gains are considered corrective. Last week’s extension reinforced the bearish theme and attention on 3902.01 next, 61.8% retracement of the Jun 17 - Aug 16. A break would open 3834.00, Jul 19 low. The EUROSTOXX 50 contract traded to a fresh trend low Monday. The reversal from last Friday’s high reinforces bearish conditions and signals scope for an extension lower. 3456.00, the 76.4% retracement of the Jul 5 - Aug 17 rally, has been pierced. A clear break would open 3386.00, the Jul 15 low.
  • In FX, the EURUSD trend direction is unchanged - it remains down. Yesterday’s fresh trend low of 0.9878 reinforces the bearish theme and confirms a resumption of the downtrend. The focus is on the 0.9800 handle. The GBPUSD trend needle still points south and Monday’s fresh trend low reinforces current conditions. The focus is on 1.1412, the Mar 20 2020 low and the next major support. USDJPY bulls remain in the driver’s seat and the pair continues to appreciate. The 141.00 handle has been cleared and sights are on the next objective at 142.08, the 2.00 projection of the Aug 2 - 8 - 11 price swing. EURJPY has cleared last week’s high and resumed its current uptrend. This opens 141.92, 1.382 projection of the Aug 2 - 10 - 16 price swing.
  • On the commodity front, Gold remains in a clear short-term downtrend and last week’s move lower reinforces this bearish condition. Support at $1727.8, Aug 22 low was breached confirming a resumption of the bear cycle and the break lower has paved the way for a test of $1681.0, the Jul 21 low and a key bear trigger. In the Oil space, WTI futures remain vulnerable following last week’s sharp reversal - the bearish engulfing candle on Aug 30 remains in play. This pattern suggests potential for a stronger sell-off near-term that exposes key support at $85.37, the Aug 16 low and a bear trigger.
  • In the FI space, Bund futures remain in a clear downtrend and short-term gains are considered corrective. A bearish price sequence of lower lows and lower highs remains intact. The bear trigger is 144.39, Sep 1 low, where a break would open 143.64, 2.382 projection of the Aug 2 - 12 - 15 price swing. Gilts started the week on a bearish note yesterday and the contract traded to a fresh trend low. This reinforces a bearish theme and signals scope for
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