GBP/USD attempts to break out of the bearish trend

Technical Analysis

EUR/USD in limbo as Euro summit approaches

“There is obviously still a lot of risk out there. But if you look at the euro, it’s suggesting sentiment is a lot more stable than everyone thinks.”

- IG Ltd. (based on Bloomberg)

• Pair’s Outlook

  EUR/USD's outlook tends to remain moderately bearish at the moment, despite attempts of the pair's to rebound yesterday. The Euro is under intense pressure amid the crisis in Greece, as any negative impetus is likely to send the pair substantially downwards. The immediate resistance is represented by the weekly PP at 1.1114, followed by dense supply at 1.1156. Meanwhile, the closest support is located at the current trading level of 1.1035 (100-day SMA), but losses can be allowed down to recent lows at 1.0954.

• Traders’ Sentiment

  The share of SWFX long open trades has been unchanged in the past 24 hours, as it remains at 49%.

GBP/USD attempts to break out of the bearish trend

“We could see some weakness in the pound against the dollar as a knee-jerk reaction if fiscal tightening goes ahead.”

- trader at a European bank (based on Business Recorder)

• Pair’s Outlook

  Although the Sterling appreciated against the US Dollar yesterday, gains were limited by the monthly PP around 1.56. The Pound is still likely to outperform the Greenback today, in spite of mixed technical indicators, as it closed just above a strong support. The weekly PP, however, now acts as an immediate resistance, but we should see a surge towards 1.57, where the 20-day SMA rests, unless the fundamental data disappoints.

• Traders’ Sentiment

  Market sentiment keeps improving, as bulls continue gaining ground; their share of longs now takes up 60% of the market. Meanwhile, the portion of orders to acquire the Cable declined from 56 to 51%.

USD/JPY to erase Monday’s gains

“While the BOJ remains largely sanguine on the outlook for the domestic economy, risk appetite driven developments are expected to hold sway over the USD-JPY and JPY-crosses in the near term.”

- OCBC Bank (based on FX Street)

• Pair’s Outlook

  On Monday, the USD/JPY almost reached the 123.00 psychological level, but due to lack of the bullish momentum was pulled back. As a result, the US Dollar stabilised at 122.66, right on top of the weekly pivot point. Today the Greenback is likely to bounce back from the weekly PP, despite attempts to edge higher in the early hours. The 55-day SMA keeps providing support, now around 122.45, but if the fundamentals disappoint the Buck might drop to 122.14, namely the Bollinger band.

• Traders’ Sentiment

  Although not as strong as yesterday, but market sentiment remains bullish at 70% (previously 73%). The share of buy orders returned to last Monday’s level of 67%.

XAU/USD to set eyes on 1,157

“While that suggests gold has lost some appeal as a safe-haven asset, more importantly it signifies the loss of interest in gold as an investment vehicle.”

- Phillip Futures (based on CNBC)

• Pair’s Outlook

  XAU/USD was provided with bullish impetus in the early morning trading on Monday; however, gains were somewhat erased later during the day and gold slipped back below the 1,171 mark (weekly PP). There are no formidable supports until 1,157, where the lower Bollinger band coincides with the previous week's low. This level is extremely likely to become the medium-term target for bears. However, any following downward moves should be capped by the monthly/weekly S1 at 1,154.

• Traders’ Sentiment

  The share of long open positions at the SWFX market has been flat during the past 24 hours, as it remains solid at 66%, while bears are in the minority with just 34% of all trades.