EUR/USD is a step away from 1.33

Technical Analysis

EUR/USD is a step away from 1.33

“You’ve got to stick with the dollar.”

- Bank of Tokyo-Mitsubishi UFJ (based on Bloomberg)

• Pair’s Outlook

  Initially EUR/USD dipped down to 1.3333, but afterwards managed to climb back to the weekly S1. Still, the selling pressure is likely to persist at least until the currency pair falls down to 1.33, the key support represented by the 2013 Q4 low. Here the Euro may commence a recovery, but the outlook should remain bearish, provided that the resistance at 1.35 (down-trend and monthly PP) stays intact.

• Traders’ Sentiment

  The bulls (55%) sustain a fractional advantage over the bears (45%), but the sentiment can become neutral or even bearish fairly quickly. In the meantime, the share of the buy orders dropped from 53% down to 39%.

GBP/USD bounced off weekly pivot

“Investors still seem to be expecting interest rates to rise more quickly in the U.K. than in the U.S.”

- Capital Economics (based on CNBC)

• Pair’s Outlook

  Although the Cable had the potential to advance a little further, towards the 100-day SMA or even the up-trend at 1.70, the weekly pivot point turned out to be enough to halt the rally. Now, as suggested by the daily technical indicators, the Sterling is likely to negate the recent gains and fall down to 1.6768/59, where it is going to encounter the weekly and monthly S1. Slightly lower, at 1.6731, there is the 200-day SMA ready to come into play.

• Traders’ Sentiment

  The gap between the bullish and bearish market participants has slightly widened since the last report—from 14 to 18 percentage points. As for the orders, there are now more commands to purchase the Pound (58%) than to sell it (42%).

USD/JPY found support at 102

“The overarching sentiment appears to be more toward risk reduction.”

- Westpac Banking (based on Bloomberg)

• Pair’s Outlook

  Despite the 200-day SMA appearing to be a reliable support, in the end the bears were able to push the pair through the demand at 102.48/46. As a result, USD/JPY was in a free fall for some time, until it hit the recently breached down-trend line. Accordingly, the bias towards the Buck remains bullish, since the pair pulled back yesterday, thus confirming the bullish break-out, and most technical studies are currently pointing North.

• Traders’ Sentiment

  Though there were no significant changes in the distribution between the long (73%) and short (27%) positions, the percentage of buy orders fell noticeably—from 65% yesterday to 49% as of right now.

USD/CHF held down by 0.91

“The unexpected volatility underlines the risks below the surface as FX market volatility falls near record lows.”

- DailyFX (based on Reuters)

• Pair’s Outlook
  
  The resistance at 0.9117/0.9099 proves to be quite strong, as USD/CHF is unable to reach this year’s high for a second week, being only some 50 pips away from the peak. However, the daily and weekly indicators are bullish, meaning there is still a chance the bears are going to give in and allow the rate to re-visit 0.9156. But at the same time the longer-term bullish perspectives are becoming less and less pronounced.

• Traders’ Sentiment

  A substantial majority (73%) of the SWFX traders expects appreciation of the U.S. Dollar relative to the Franc. And the buying pressure may intensify, since 72% of pending orders (100 pips from the spot) are to enter long positions.