Technical Analysis
EUR/USD
EUR/USD remains bearish
“There has been little in the way of positive press since Friday, and as such, markets have started the week as they finished the last - with a decided air of risk aversion”
- RBC Capital Markets (based on MarketWatch)
Pair’s Outlook
Friday bearishness of EUR/USD has been halted by support at 1.2106. Although, given that majority of technical indicators continue to point to the downside, this level is likely to give in and thus pave the way towards 1.2051 and 1.2012/1.1976. In case of strong recovery the pair will encounter resistances at 1.2187 and 1.2262.
Traders’ Sentiment
The single European currency is the most frequently bought in SWFX marketplace, namely in 73% of cases. Accordingly, most of market participants (63%) have preferred to open long positions on EUR/USD, expecting the Euro to appreciate relative to the greenback. However, sell orders (64%) considerably exceed buy orders (36%).
GBP/USD
GBP/USD struggles at 1.5585/83
“The pound can seemingly weather any weak data that is thrown at it”
- CaxtonFX (based on Reuters)
Pair’s Outlook
GBP/USD has just confronted a formidable level at 1.5585/83, which should be eroded and then allow further depreciation of the British Pound relative to the U.S. Dollar. Subsequent supports lie at 1.5530/04 and 1.5427/1.5389 and will be even harder to breach, though the pair is expected to regain bullish momentum only near 1.5289/49, consequently, rallies are to remain shallow.
Traders’ Sentiment
Traders’ sentiment remains mixed towards the Cable, since the shares of bullish and bearish traders are nearly equal, constituting 49% and 51% of the market, respectively. As for the orders, most of them (61%) are to acquire the Dollar, while only 39% are to acquire the Sterling.
USD/JPY
USD/JPY’s downward momentum is weakening
“With such strong risk aversion it is the yen and the dollar that will keep gaining against risk currencies. The Spanish scenario has not been priced in yet”
- Bank of Tokyo-Mitsubishi UFJ (based on CNBC)
Pair’s Outlook
USD/JPY is currently grinding down a support area at 78.22/08, after which it is likely to target 77.85, while a lower level at 77.33 has a much lesser chance of being attained, since in general indicators are neutral. Even though resistances at 78.68 and 78.98 are unlikely to come into play, they will attempt to limit rallies en route to a key zone at 79.23/50, if the present trend is reversed.
Traders’ Sentiment
The Japanese Yen remains the least popular currency among liquidity consumers of SWFX, thereby the overwhelming majority of traders (74%) are holding long positions on USD/JPY, whereas merely 26% of the market anticipate the Yen to gain in value. Moreover, 73% of orders placed on the pair are buy orders.
USD/CHF
USD/CHF to keep on advancing
“The negative headlines in the euro zone caused the dollar to strengthen across the board. China’s slowing economic growth is still a lingering concern”
- Bank of Singapore Ltd. (based on Bloomberg)
Pair’s Outlook
Since the last report USD/CHF has penetrated several resistances and is about to confirm a break of 0.9906 today, above which it will aim for 0.9960/87 first, then for 1.0018/42. The nearest support is located at 0.9853, followed by 0.9795, though a key level is situated at 0.9692/88, safety of which preserves bullish outlook of the price in the long-term.
Traders’ Sentiment
The portion of bulls has increased up to 62%, implying growing conviction of market participants that USD/CHF is to continue rallying. On the other hand, the pair is becoming overbought, as also evidenced by the ratio between buy and sell orders, being 29% to 71%, respectively.
