EUR/USD still buoyed by lower Bollinger band

Technical Analysis

EUR/USD still buoyed by lower Bollinger band

“The risk of regulatory capture is something the Federal Reserve takes very seriously and works very hard to prevent. It is important that anyone serving the Fed feel safe speaking up when they have concerns about bias toward industry, and that those concerns be addressed.”

- Janet Yellen, Fed Chairwoman (based on Bloomberg)

• Pair’s Outlook

  For a fourth consecutive day EUR/USD is posting no considerable daily changes in its value. On Tuesday, despite being initially supported by the Bollinger band, the pair failed to consolidate above the 1.12 mark and fell back below it. Still, this technical level continues to act as a strong support line for the Euro at the moment. Daily technical indicators are mixed right now; therefore, a decline below 1.1120 (weekly S1) is unlikely in the near term.

• Traders’ Sentiment

  Bullish positions at SWFX are accounting for 48% in the morning on Wednesday, down one percent from yesterday. Additionally, SWFX pending orders to buy the Euro against the US Dollar in 100-pip range from the spot are in the minority and account for just 38%.

GBP/USD slides down

“Considering the market's reaction to the Scottish independence referendum last year, we would hardly be surprised if, on this occasion, sterling were to react more negatively should the outcome remain this unclear as May 7 approaches.”

- SEB Group (based on CNBC)

• Pair’s Outlook

  Sterling keeps surprising with its behaviour, as the currency edged down again on Tuesday. Even though the decline was insignificant, it still remains a loss. Furthermore, by virtue of demand at the 20-day SMA the Pound settled at 1.5357. Today the technical studies also suggest an increase in the value of the Pound. Meanwhile, the UK Services PMI data release is likely to have a high impact on the Sterling, and stronger figures are expected. Closest resistance remains unchanged at 1.5438, the current location of the weekly PP.

• Traders’ Sentiment

  Bulls slightly grew in numbers: at the moment 69% of positions are long. Meanwhile, the distribution between the buy and sell orders in the 100-pip range from the spot is in perfect equilibrium.

USD/JPY’s rally delayed

“The relationship between the Japanese stock market and the U.S. dollar/Japanese yen (pair) has been strange since mid-February.”

- UBS Group AG (based on Reuters)

• Pair’s Outlook

  USD/JPY pair bounced back on Tuesday after a three-day rally. The pair tested the weekly PP, which proved to be strong enough to stop the currency from declining further. Moreover, at the end of the trading day the Greenback settled between the weekly PP and R1 at 119.71, as was anticipated. The daily technical indicators are emitting neutral signals; hence, the Buck is likely to trade in the same range as yesterday (between the weekly PP and R1), unless some data release today surprises with unexpected results.

• Traders’ Sentiment

  The SWFX market sentiment improved, as 61% of all positions are now long (59% yesterday). The number of buy orders surged even more, from 63% to 71%.

XAU/USD attempts to penetrate weekly PP

“In the short term, the mood is still bearish though we might trade in a tight range until the jobs data on Friday.”

- a commodities trader in Hong Kong (based on CNBC)

• Pair’s Outlook

  Despite strong Gold price's fluctuations on Tuesday, the metal registered only a marginal daily change. All in all, the bullion was capped by resistance at 1,207 (weekly PP) and closed around 1,203 at the end of yesterday's trading session. Taking into consideration fairly bearish technical indicators on a daily chart, the closest resistance should be strong enough to give bears impetus for future attempts to push the metal lower. Therefore, the short term outlook tends to remain pessimistic, with the closest target at 1,195 (weekly S1).

• Traders’ Sentiment

  Sentiment toward the precious metal is remaining optimistic among SWFX traders, even though a total share of bullish positions (55%, +2% since yesterday) is not as high as several days before.