GOLD TECHS: Trend Needle Points North

• RES 4: $71.45 - 76.4% retracement of the Jun 23 - Oct 20 bear leg  
• RES 3: $70.69 - High Jul 30
• RES 2: $69.29 - High Sep 26 and a key resistance 
• RES 1: $65.98 - High Oct 9 
• PRICE: $64.16 @ 07:09 GMT Nov 10
• SUP 1: $62.84/59.97 - Low Nov 6 / 20 and the bear trigger  
• SUP 2: $58.72 - Low May 5
• SUP 3: $57.99 - Low Apr 9 and a key support
• SUP 4: $56.05 - 2.00 proj of the Jul 30 - Aug 13 - Sep 26 price swing 

The latest pullback in Brent futures appears to be a flag formation - a bullish continuation pattern. This suggests that a corrective cycle remains intact for now. Price has recently traded through the 50-day EMA, at $64.58. Clearance of this hurdle signals scope for a stronger recovery. The next resistance to monitor is $65.98, the Oct 9 high. A clear breach of it would expose a key resistance at $69.29, the Sep 26 high. Key support lies at $59.97, Oct 20 low.

For the full MNI BOE Review, including summaries of sellside views click here.

• The title of our BOE Preview was “It’s All About Bailey” and we expected a 5-4 vote (without much confidence over which way the 5-4 vote would swing). The outcome was a 5-4 vote to leave Bank Rate on hold and the new individual member paragraphs in the Minutes indicated that Governor Bailey was the only MPC member who did have see their vote as a clear cut decision at this meeting.
• We think that overall if data comes in line with the BOE's updated short-term projections and we get a disinflationary Budget that Bailey will support a near-term cut.
• We look into detail at the near-term projections with some material downgrades to the August MPR projections making it harder to undershoot the forecasts.
• We think it unlikely barring very large surprises that we would see any of the other 8 MPC members not repeating their votes at the December meeting.
• 9/21 sellside reviews that we have read see a change in view with 16/21 analysts now looking for a December cut. We look at these views in more detail.

• RES 4: 180.37 1.500 proj of the Jul 31 - Sep 29 - Oct 2 price swing  
• RES 3: 180.00 Psychological round number
• RES 2: 178.94 1.236 proj of the Jul 31 - Sep 29 - Oct 2 price swing
• RES 1: 178.82 High Oct 30 and the bull trigger
• PRICE: 178.13 @ 07:14 GMT Nov 10 
• SUP 1: 175.29 50-day EMA
• SUP 2: 174.82 Low Oct 17 
• SUP 3: 173.92 Low Oct 6 and a gap high on the daily chart   
• SUP 4: 173.77 Bull channel support drawn from the Feb 28 low  

The trend in EURJPY remains bullish and a price sequence of higher highs and higher lows is intact. Moving average studies are in a bull-mode position too, highlighting a dominant uptrend. Recent gains signal scope for an extension towards 178.94 next, a 1.236 projection of the Jul 31 - Sep 29 - Oct 2 price swing. Support to watch lies at the 50-day EMA, at 175.29. A clear break of this EMA would signal scope for a deeper retracement.