GBP/USD bounces towards weekly PP

Technical Analysis

EUR/USD consolidates below 1.23

“That the Bundesbank may object to sovereign-bond purchases is largely taken for granted by markets. Tacit support from Berlin would neutralize Bundesbank objections in the German public debate.”

- Berenberg Bank (based on Bloomberg)

• Pair’s Outlook

  EUR/USD pair continued to trade under the bearish pressure, as they pushed the cross below 1.23. At the moment the only support before the 2014 low is represented by a Bollinger band at 1.2255, which is not supposed to create major problems for pair's bears. Even though daily technical studies are still neutral, weekly ones are pointing to the downside, meaning that the next week we are likely to see a testing of this year's low.

• Traders’ Sentiment

  Distribution between bullish and bearish opened positions on the SWFX market returned back to the positive side, as the former are now in the majority with 51%. Meanwhile, commands to buy the Euro dropped considerably to 39% in 100-pip range from the spot.

GBP/USD bounces towards weekly PP

“The [US] economy continues to run hard as it finishes out the year.”

- MUFG Union Bank (based on Reuters)

• Pair’s Outlook

  Since the last time of writing the pair has managed to reverse the sharp drop that took place late on Wednesday and currently it is hovering around the weekly PP at 1.5672. In case the pair wants to prolong its appreciation then it will have to surpass the monthly PP at 1.5755 that does not seem very likely. To our mind the bias remains negative, with the target at 1.5542.

• Traders’ Sentiment

  As the pair is currently consolidating, there are still no changes in the distribution between the bullish (56%) and bearish (44%) market participants. Concerning the orders, the share of the sell orders has managed to edge up from 58% to 63%.

USD/JPY continues to challenge 119.38

“There are fiscal and monetary policy risks. There are some issues that need to be solved like exports are not growing, companies are not spending. These need to be solved, but I think it takes time.”

- Japan Macro Advisers (based on CNBC)

• Pair’s Outlook

  The USD/JPY cross has not changed much since yesterday, as it continues to challenge the weekly PP at 119.38. Most likely the pair will have the strength to test the major level at 120; however if not, then there is a risk of the pair falling towards the weekly S1 and monthly PP at 116.91/75 once again. At the mean time, the weekly technicals point upwards.

• Traders’ Sentiment

  The sentiment of the SWFX market participants has not changed and it remains neutral with respect to USD/JPY - 52% of the market participants are long. Concerning the orders placed 100 pips from the spot, there are now significantly less commands to sell— 52%.

Gold little changed around monthly R1

“Physical gold demand in China and India were held back in 2014 amid high stocks and import controls, respectively. Both these shackles have been removed, putting demand on a solid footing as we head into 2015.”

- ANZ (based on CNBC)

• Pair’s Outlook

  On Thursday, Gold increased in price and was able to jump above the monthly R1, reaching the daily high around $1,214. At the same time, the price managed to stabilize and returned back just above the weekly S1 towards the end of the trading session. Taking into account mixed daily technical indicators and rather strong resistances and supports around the current trading level, we would suggest it to hover sideways in the foreseeable future.

• Traders’ Sentiment

  Distribution between opened positions for buying or selling Gold remained completely unchanged during last 24 hours. At the moment 75% of SWFX market participants are betting on the upside movement.