EUR/USD shows minor rebound from monthly low

Technical Analysis

EUR/USD shows minor rebound from monthly low

“Janet Yellen’s remarks last Friday that she expected rates to rise this year and that the recent slowdown seen in Q1 is likely to be transitory, though some of the recent data seen from April does throw some elements of doubt into that belief.”

- CMC Markets (based on WBP Online)

• Pair’s Outlook

  The EUR/USD pair attempts to recover at least some part of losses that have occurred since May 19. On Thursday, the cross jumped above the 55-day SMA nearest resistance line and closed just below 1.0950. However, any bullish movements are likely to be limited, unless the Euro closes above the monthly PP at 1.1003, as this move will change the short-term outlook to bullish. At the same time, the medium-term weakness is set to remain in place, while the bears' target is placed at 1.0740 (monthly S1).

• Traders’ Sentiment

  The gap between long and short positions remains insignificant at the moment, as bulls are keeping 48% of all opened positions, no change during the past 24 hours.

GBP/USD still in tight range between 1.52 and 1.54

“U.S. growth momentum will take center stage today, with the second release of Q1 GDP expected to be revised down sharply.”

- Barclays (based on CNBC)

• Pair’s Outlook

  On Thursday, the Cable edged down for the fourth day this week, although the fall was not as sharp as anticipated. GBP/USD managed to reach the weekly S2, which caused the pair to bounce back a bit and settle at 1.5318. Although technical studies retain mixed signals in the daily timeframe, the longer periods give distinctly bullish signals, suggesting the Sterling is bound to regain the bullish momentum. Today if the Pound crosses the 1.53 area, we might see more weakness down to the 1.52 level, from which the solid rebound should occur in the future.

• Traders’ Sentiment

  Bulls keep growing in numbers, as 47% of traders hold long positions today, while the share of purchase orders increased from 56 to 60%.

USD/JPY struggles to stay above the 2007 high

“The tone in U.S. economic numbers is improving. This reminds investors U.S. rates are moving up later this year and has revived the dollar's appeal since last week.”

- Commonwealth Foreign Exchange Inc. (based on Reuters)

• Pair’s Outlook

  USD/JPY extended its rally for another day, but at a much slower pace than before. However, the US Dollar did surge up to 124.47, almost reaching the weekly R3, but then was pushed back under the 2007 high and stabilised at 123.80. Right now technical indicators are showing bullish signs, suggesting the pair is to rise again today. The Bollinger band and the 2007 high act as an immediate resistance area, but we should not rule out the possibility of a slump back to 123.00, due weak fundamental data expectations.

• Traders’ Sentiment

  Bullish market sentiment returned to its Wednesday’s level of 56%. The number of buy orders lost 24 percentage points. The commands now also take up 56% of the market.

XAU/USD trades with moderate bullish gains

“The (gold) market looks set to continue to trade in a $1,180-$1,195 range with a break to the downside looking more likely in line with the surging dollar.”

- MKS Group (based on CNBC)

• Pair’s Outlook

  The precious metal has been trading flat for a second consecutive day on Thursday, while awaiting additional influencing factors. The bullion, however, made an attempt to slump below the weekly S2 at 1,182 yesterday, but was pushed back in the direction of 1,190. The metal is required to show more volatility in order to escape the narrow range between 1,182 and 1,194. An upward scenario seems more difficult at the moment, considering a dense cluster of immediate supply levels (monthly PP, 55-day SMA, weekly S1).

• Traders’ Sentiment

  Advantage of bulls over bears at the SWFX market remains strong. The total share of long opened positions hovers just above 60% for a third day in a row, and specifically at 61% in the morning on Friday.