EUR/USD sets new 2014 low

Technical Analysis

EUR/USD sets new 2014 low

“In case of sovereign QE, it’ll be difficult to square the circle to make everybody happy.”

- UniCredit SpA (based on Bloomberg)

• Pair’s Outlook
  

  EUR/USD stayed under bearish pressure on Friday of last week, as the shared currency dropped below 1.23 and consequently set a new 2014 low at 1.2219. Moreover, the pair fell below the monthly S2, which is located at 1.2228. As a result, we can see a slight consolidation around this major level, while in the next few days the pair may continue declining further.

• Traders’ Sentiment

  Distribution between bullish and bearish opened positions on the SWFX market managed to stay positive, as long positions are still accounting for 51% of all trades. Additionally, long pending orders in 100-pip range from the spot added only one percentage point from Friday to reach 40%.

GBP/USD trades above 1.56

“This [oil demand] is mostly driven by crude oil prices, and absent a sudden spike we very well may see a drop of a few pennies more. That said, demand is up at these low prices."

- Lundberg (based on Reuters)

• Pair’s Outlook
  

  The second part of the week was rather bearish for the pair, as it fell to the lowest level this year; however, it has recovered since then. Currently, the GBP/USD cross is sitting above the 1.56 level and around the weekly PP at 1.5654. Despite the monthly technical indicators are pointing upwards, we are still more bearish towards the pair. Nevertheless, most likely we will see a sideways movement through the week.

• 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. As for the orders, as many as 59% of them are to sell the Pound against the US Dollar.

USD/JPY nears 120 level

“Japan's November data will show the economy continues to underperform.”

- Moody’s Analytics (based on CNBC)

• Pair’s Outlook

  USD/JPY has recovered since the weak performance at the beginning of the previous week and now is nearing the 120 mark. The bullish pressure is surely growing; although, the mentioned 120 level will not be a small obstacle to face. Nonetheless, we expect the pair to surpass the psychological level, while the technical studies are neutral with only the monthly ones being bullish.

• 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. The distribution between the buy and sell orders is also quite stable—55% and 45% respectively.

Gold little changed just below weekly PP

“Considering that the dollar has gained across the board, gold has been holding up extremely well.”

- UBS (based on Bloomberg)

• Pair’s Outlook

  Last Friday, the bullion fell slightly to trade around $1,195 per ounce at the end of trading session, even though the overall picture for the metal remained neutral. Gold is still unable to climb higher than the monthly R1 at $1,205, which is reinforced by a number of other strong resistance levels. According to technical indicators, in the weekly perspective we should see bears taking the lead and the pair losing value. The next support line is located as far as at $1,177 (weekly S1).

• Traders’ Sentiment

  Distribution between opened positions for buying or selling Gold went down marginally to reach 73% in the morning of today. On Friday, however, 75% of SWFX market participants were betting on the upside movement.