Dukascopy Bank Team
Dukascopy Bank SA
Technical Analysis
EUR/USD: another session with no visible leader
“The risk-off environment has a tendency to drive euro higher.”
- Bank of Montreal (based on Bloomberg)
Pair’s Outlook
Neither the bulls nor bears have again gained any leadership in terms of driving the EUR/USD currency pair. It traded in a wide range between 1.0945 and 1.0830 yesterday, but nobody managed to close the session any near both of these levels. The pair keeps hovering slightly above 1.0860 today, while positive US fundamentals later in the day should expose 1.08 (55-day SMA; monthly PP), which used to be a reliable support earlier this week. A negative surprise, however, could result in a climb above the two-month trend-line at 1.09.
Traders’ Sentiment
The share of long traders bounced back to 45% by Friday morning. Commands to sell the Euro against the Buck in 50 and 100-pip ranges were pushed as high as 61% and 54%, respectively.
GBP/USD to steer away from 1.44
“In the current environment however, with investors becoming increasingly worried about the impact of the slowdown in China, concerns over the UK economy and the risk of a 'Brexit' look likely to continue to haunt sterling.”
- HiFX (based on Business Recorder)
Pair’s Outlook
The Sterling’s recent rally against the US Dollar was reduced to zero, with the weekly S1 ultimately holding the gains at 1.4414. The pair remains stuck between the weekly S1 and the monthly S2, while disappointments in today’s US fundamentals could cause a breakout to the upside. The second level to limit the losses lies at 1.4567, but it will be difficult to reach. Contrariwise, the Greenback could receive another boost and push the Pound even lower towards the 2010 low at 1.4230, despite the monthly S1 being able to keep the Cable from declining through all of the week.
Traders’ Sentiment
Both long positions and purchase orders remain unchanged today, taking up 63% and 43% of the market, respectively.
USD/JPY struggles to preserve the up-trend
“The safe haven appeal of the yen is likely to keep it in demand in the week ahead as global investor risk sentiment is likely to remain fragile.”
- Bank of Tokyo-Mitsubishi UFJ (based on WBP Online)
Pair’s Outlook
A strong reading of yesterday’s US Import Prices helped the USD/JPY pair to preserve the up-trend and stabilise at the highest level this week. The Buck, however, struggled to climb over the weekly PP, which acted as the immediate resistance and limited the volatility. A breakout of the current trading range is expected, with the bearish trend prevailing. Nevertheless, the immediate support in face off the up-trend and the monthly S2 around 117.70 remains strong, which in turn could even cause a rebound and a breach of the weekly PP at 118.30. Technical studies, on the other hand, retain bearish signs.
Traders’ Sentiment
Today 62% of traders hold short positions, whereas sell orders outnumber the buy ones by only 2% points (previously 4% points).
Gold's decline is repeatedly stopped by 55-day MA
“The positive move in global equity markets is bearish for gold.”
- Shandong Gold Group (based on CNBC)
Pair’s Outlook
Bearish sentiment dominated in the market on Thursday, being that gold slumped below 1,075 for the first time in eight trading days. Eventually prices, which started depreciating from the weekly PP at 1,092, were contained by 55-day SMA at the end of US session. Early in the Asian session on Friday we are observing some mild gains, meaning the moving average is holding strong for the moment. Short-term bullish case is expected by daily technical indicators, but any positive surprise from US statistics later today could put at risk any recovery and expose the area below yesterday low of 1,071.50.
Traders’ Sentiment
Price losses that occurred yesterday used to have a positive impact on the SWFX market sentiment. The decline encouraged somewhat move purchases of the safe haven metal, as the percentage of "buy" open positions rose to 56% from 55%.
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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