Dukascopy Bank Team
Dukascopy Bank SA
Technical Analysis
EUR/USD set to probe 1.13 again
“Receding expectations for a Fed rate hike are making the dollar vulnerable. Both the yen and the dollar are pressured.”
- Shinkin Asset Management (based on Bloomberg)
Pair’s Outlook
The common currency was actively fuelled by support zone at 1.1241/20 on Thursday. It managed to bounce off the monthly pivot point, but gains used to be contained by the 50% Fibonacci retracement of the Jan-Mar 2015 downtrend at 1.1280. Still, an attempt to surge as high as 1.1328 was made, and we expect the bullishness to continue in the nearest future. Resistances to violate include the weekly R1 at 1.1304, and success here can send EUR/USD up to the 1.14 area during the next week. This idea is supported by bullish weekly technical indicators.
Traders’ Sentiment
The share of bulls fell from 49% to 47% in the past 24 hours, while long pending orders in 100-pip range from the spot price improved further from 54% to 58%.
GBP/USD takes another crack at weekly R3
“The minutes didn't give the market any clarity on when liftoff would occur and markets were hoping for more guidance.”
- Myles Clouston, Nasdaq director (based on WBP Online)
Pair’s Outlook
The Sterling appreciated against the US Dollar for the third consecutive day yesterday, while testing both the immediate support and the second closest resistance. The rally was not as strong as expected, but the Pound has a chance of reaching the 1.54 major level today. An obstacle, however, lies on the Cable’s path in face of the weekly R3 at 1.5379, which could hold the gains. The GBP/USD is now supported by a tough cluster around 1.53, limiting any possible dips. Meanwhile, technical studies also suggest the pair is stuck between 1.53 and 1.54.
Traders’ Sentiment
The percentage of bulls dropped to the lowest (57%) in October, while the share of buy commands also worsened, from 54 to 49%.
USD/JPY poised to begin recovery
“The minutes were viewed as mirroring the dovish tone to the September 17 Fed statement rather than the more hawkish message delivered by a number of Fed speakers in the aftermath of the meeting.”
- Barclays (based on Business Recorder)
Pair’s Outlook
The USD/JPY remained relatively unchanged on Thursday, having lost only eight pips. The immediate support cluster kept the US Dollar afloat and is likely to cause a rebound from the Buck’s three-day slump. As a result, the Greenback should return above the 120.00 major level, around which it orbited for a whole month. The upper boarder of the given pair’s trading range lies at 120.63, and is unlikely to be reached or pierced today, as the 20-day SMA at 120.13 should slow down the bullish momentum.
Traders’ Sentiment
Bullish market sentiment returned to its Tuesday’s level of 70%. At the same time, the portion of orders to acquire the US currency added six percentage points, now accounting for 61% of the market.
Gold targets 1,147 for fourth consecutive day
“Gold was choppy following the U.S. FOMC minutes that did not give a clear indication of whether or not the Fed is poised to raise interest rates this year.”
- ScotiaMocatta (based on CNBC)
Pair’s Outlook
From Tuesday till Thursday the precious metal was unable to penetrate the monthly R1 at 1,147. This resistance is strengthened by the 50% Fibonacci retracement of the May-July 2015 downtrend at 1,151. Following a bullish bounce back from yesterday's lows around 1,138, we expect the bullion to continue attacking the mentioned monthly resistance line. A rise above 1,151 would allow for a climb up to 1,155 in the near-term and 1,170 during the next trading week. On the other hand, any losses are likely to be limited by a powerful demand at 1,133/30.
Traders’ Sentiment
This week the share of SWFX bullish open positions has remained largely stable, while yesterday their portion was fully unchanged at 53%.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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