Dukascopy Bank Team
Dukascopy Bank SA
Technical Analysis
EUR/USD risks declining from up-trend
“All the forecasts were very, very aggressively tilted toward more dollar strength, and it’s not clear at all that we’re getting that.”
- OppenheimerFunds Inc. (based on Bloomberg)
Pair’s Outlook
EUR/USD is now placed near the upper edge of the bullish channel pattern in the daily chart. This resistance, at 1.1370, is accompanied by the weekly R1. From here a slide is possible over the next 24 hours, as the bears are watching the monthly R3 at 1.1246 as immediate target, followed by the monthly R2 at 1.1115. Alongside, a spike above the three-month uptrend will expose the Sep high and weekly R2 at 1.1460 and 1.1504, respectively. Signals among technicals remain mixed, as daily ones are bullish and weekly studies are mostly on the "sell" side.
Traders’ Sentiment
The share of bulls went up to the highest level in five working days of 42%. Alongside, commands in both shorter and longer-ranges are equally divided between the long and short SWFX traders.
GBP/USD endeavours to climb higher
“There is no change to our neutral outlook for now. We continue to expect GBP to trade in a broad range, likely between 1.4350 and 1.4650 in the coming days.”
- UOB (based on FXStreet)
Pair’s Outlook
The Cable took another shot at the monthly PP yesterday and, as a result, retreated from intraday losses, closing at 1.4480. Although the weekly pivot point is providing immediate support for the pair, we might still see the cluster just below the 1.44 level get retested, as weekly technical indicators retain their bearish signals. At the same time, if US data disappoints today, the GBP/USD currency pair is likely to end the week higher, with Thursday’s losses completely erased. The nearest resistance is formed by a group of technical levels around 1.4670, thus, remaining out of reach.
Traders’ Sentiment
Today 56% of traders retain a positive outlook towards the Pound. Meanwhile, the share of purchase orders inched up from 45 to 47%.
USD/JPY falls on Fed rate hike delay speculation
“I think 110 sounds terrible, for the Japanese economy. But it's a tough job for them [Japanese authorities], to keep levels in dollar/yen.”
- BBH (based on CNBC)
Pair’s Outlook
The USD/JPY partially recovered from its intraday low of 111.00 on Thursday, as Yellen’s remarks dispersed some speculation concerning the Fed’s monetary policy. However, the pair still closed with a 90-pip loss and is showing little sign of a possible rebound today. The rally could occur, pushing the pair towards the weekly S2 and the down-trend around 113.05, with a chance to even put the monthly S2 at 113.88 to the test. The more probable outcome remains a decline beyond the 111.78 level, namely the monthly S3.
Traders’ Sentiment
Bulls are barely outnumbering the bears, as 52% of all open positions are long, unchanged since yesterday. The number of purchase orders, on the other hand, surged from 50 to 62%.
Gold soars to one-year high, hits 1,263
“People are fearful about currencies, so they've moving to the one currency they are confident in and that's gold.”
- an independent investment manager (based on CNBC)
Pair’s Outlook
Gold appreciated the most since December 2014 on Thursday, by becoming $60 more expensive in just 24 hours of trading. Only the third resistance managed to contain the rally, while monthly R3/monthly R2 (1,209/13) and May 2015 high (1,232) were both easily penetrated. Trading volume is the greatest since March 2011, while Bollinger bands indicate volatility is ultra-high for the moment. Daily RSI is assuming gold is overbought, thus making a correction back below May high more likely. On the side of bulls, a spike beyond weekly R3 (1,252) should expose the 2015 high at 1,307.
Traders’ Sentiment
The bullish-bearish distribution has stalled over the last four days 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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