XAU/USD holds above weekly S1 after testing 1,157

Technical Analysis

EUR/USD is fuelled by 100-day SMA

“Until the outcome of the referendum is known next week, investors here are hesitant to take currency positions.”

- Sumitomo Mitsui Trust Bank (based on Reuters)

• Pair’s Outlook

  EUR/USD was somewhat upbeat after the NFP numbers yesterday, as the currency pair seems to have started eroding a loss of 190 pips that occurred Tuesday-Wednesday. Moreover, the Euro is presently underpinned by the 100-day SMA and weekly S1 at 1.1050. The short-term outlook is neutral to positive, while the pair is able to rally towards the 55-day SMA at 1.1141. However, the medium-term expectations remain pessimistic and bears are still setting eyes on Jun 29 low at 1.0954.

• Traders’ Sentiment

  The share of SWFX long open trades decreased just marginally in the past 24 hours, therefore falling again below the 50% threshold, even though the sentiment is still more or less neutral.

GBP/USD likely to rebound from 1.56

“GBP dipped to a low of 1.5562 before rebounding quickly. While further down-move is not ruled out, the current price action suggests that this pair is trying to form a short-term base for a recovery.”

- UOB Group (based on FX Street)

• Pair’s Outlook
  
  The GBP/USD remained relatively unchanged on Thursday, as the support cluster at 1.5595 prevented the pair from falling and, thus, caused a slight rebound. As a result, we expect the Cable to advance again today and attempt to climb back up beyond the 1.5650 area, as the Sterling is unlikely to breach the given support. However, the closest resistance is located at the 1.57 psychological level, namely the 20-day SMA. Meanwhile, technical indicators retain bullish signals, bolstering the possibility of the pair rallying.

• Traders’ Sentiment

  Market sentiment keeps strengthening, as 58% of traders now hold long positions, compared to 56% yesterday. The share of orders to acquire the Pound also increased, from 54 to 59%.

USD/JPY trades in limbo; risks edging lower

“The greenback has been trading primarily on risk appetite and the next big move for the dollar will most likely be driven by the outcome of the Greek referendum.”

- BK Asset Management (based on WBP Online)

• Pair’s Outlook

  Although the US Dollar attempted to appreciate against the Yen yesterday, it still suffered losses and declined towards the weekly PP near the 123.00 major level. Due to lack of movers, the USD/JPY is likely to remain flat today and remain within the borders of the weekly PP and 20-day SMA. Nevertheless, risks of edging lower exist and the pair could reach as low as 122.40 by the end of the day, as technical studies are showing bearish signals in the daily timeframe.

• Traders’ Sentiment
  
  Although not as strong as yesterday, but market sentiment remains bullish at 69% (previously 73%). The number of buy orders lost ten percentage points; the commands now take up 51% of the market.

XAU/USD holds above weekly S1 after testing 1,157

“Despite the slightly soft tone evident in. September remains on the cards for the Fed to commence its hiking cycle.”

- Australia & New Zealand Banking Group Ltd. (based on Bloomberg)

• Pair’s Outlook

  This week's behaviour of XAU/USD cross is very similar to the one it showed last week. From Monday the cross was declining for four days in a row and today it attempts to rebound. Yesterday, however, gold reached the new June low at 1,157 after US NFP, but bounced back afterwards and closed the trading session at 1,166. Supported by the weekly S1 at 1,162, the bullion will be expected to advance in the short term. The immediate resistance is in turn located around 1,180 (monthly and weekly PP, 2013 low, 20-day SMA).

• Traders’ Sentiment

  The total share of long open trades at the SWFX market experienced a further slump from yesterday, but it remains solid at 63%, while bears are in the minority with 37% of all trades. Bullish share on the market decreased five additional percentage points in the past 24 hours.