Dukascopy Bank Team
Dukascopy Bank SA
Technical Analysis
EUR/USD unchanged after volatile session
“The idea that you will be okay if you buy the dollar since the United States alone will be raising interest rates, is becoming difficult to justify.”
- Sumitomo Mitsui Banking Corporation (based on Reuters)
Pair’s Outlook
EUR/USD was turbulent on Wednesday, with intraday dips prolonging down to the 1.1160 mark. However, by daily close the bulls reclaimed leadership and sent the pair back to 1.1290, meaning they were uncertain about comments made by the Fed Chair Janet Yellen. Today we continue watching the first weekly resistance at 1.1330, followed by the upper Bollinger band at 1.1394. Success here will have major bullish implications for EUR/USD, which could surge up to 1.1460 (Sep high) in the next few days. Alongside, the key long-term support is offered by 200/20-day SMAs and the weekly PP at 1.1072/53.
Traders’ Sentiment
Bullish market portion on the SWFX market has stalled at 39%, while pending orders are again set to buy the Euro in most of the cases.
GBP/USD to keep edging higher
“We expect bearish GBP against EUR but bullish against USD on the back of USD weakness.”
- Hong Leong (based on PoundSterlingLive)
Pair’s Outlook
Even though the GBP/USD currency pair appreciated on Wednesday, it was unable to retain its position near intraday highs. Today the closest short-term resistance is represented by the Bollinger band, the 55-day SMA, the weekly and monthly R1s around 1.4675, but a surge of at least 110 pips in order to reach that area is doubtful. The bullish momentum, however, is expected to prevail, with the Cable remaining under the 1.46 mark. Furthermore, technical indicators keep giving bullish signals, suggesting a retreat towards the immediate support in face of the weekly PP is unlikely.
Traders’ Sentiment
Bullish traders’ sentiment returned to its Tuesday’s level of 54%, whereas the number of sell orders added 4% points up to 55%.
USD/JPY falls on Fed rate hike delay speculation
“The yen remains significantly undervalued according to our long-term valuation models leaving plenty of scope for further yen strength if global financial market conditions continue to deteriorate.”
- Bank of Tokyo-Mitsubishi (based on WBP Online)
Pair’s Outlook
The US Dollar sustained a rather heavy loss against the Japanese Yen yesterday, finding support only closer to the third target level. The Yen keeps strengthening and is expected to outperform the Buck for the fourth consecutive day today. The Bollinger band and the weekly S2 provide immediate support circa 113.15, but a drop deeper down, namely towards the monthly S3 at 111.78, is more probable. However, if bulls do manage to push the USD/JPY higher, strong supply is likely to limit the gains around the major level of 114.00.
Traders’ Sentiment
A gradual development was seen in share of long positions, as it doubled since yesterday, now taking up 52% of the market. Pending orders are equally divided between the buy and the sell ones.
Gold aims at violating weekly R2 at 1,213
“Stop loss orders are being triggered on the break of $1,200.”
- MKS Group (based on CNBC)
Pair’s Outlook
Gold prices soared again on Wednesday, underlying heavy demand for haven assets in time of global economic uncertainty and dovishness of Fed Chair Janet Yellen. Yellow metal could consolidate above 1,200 for the first time since June on Thursday, after it has climbed 14% so far in 2016. The key resistance remains intact, but we expect those monthly R3 and weekly R2 at 1,209/13 to be properly tested over the next 24 hours. By closing above here the metal will be a good position to move up to May 2015 high 1,232.
Traders’ Sentiment
He bullish-bearish distribution has stagnated over the last 24 hours at 43-57%, thus maintaining the biggest advantage for the bears in more than a year.
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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