GBP/USD approaches monthly S1

Technical Analysis

EUR/USD falls below 1.26

“I don’t think there’s any question that compared to Europe or Japan we’re looking pretty good here. But relative to our own standards and history, we’re still in a disappointing expansion.”

- J.P.Morgan Chase (based on Wall Street Journal)

• Pair’s Outlook

  It seems that the Euro/Dollar cross resumed its long-term downward trend, since it declined further yesterday and surpassed the major level at 1.26. Moreover, the weekly S1 at 1.2579 appeared to be a rather weak support line and the pair closed below it. The next considerable demand area is located at 1.25 (2014 low) and bulls will use this opportunity to reverse the pair, as they did it on October 6. Daily technical indicators, however, still give mixed outlook for the Euro and weekly ones point to the south.

• Traders’ Sentiment

  Even though the market sentiment became more bullish during past 24 hours (57% of all positions are long), pending orders both in 50 and 100-pip ranges deteriorated to the levels seen five days ago.

GBP/USD approaches monthly S1

“Confidence is moving in the right direction, but the fact remains, as a whole, Britons are still pessimistic about what's ahead.”

- Nielsen UK ( based on Reuters)

• Pair’s Outlook

  Bearish trend continued to prevail on the market for GBP/USD currency pair on Thursday, as it went further to the downside and neared a significant support line at 1.5962, represented by monthly S1 and strengthened by the Bollinger band. At the same time, if the pair decides to fall even lower, it will face both 2013 Q4 and 2014 lows, which are located less than 100 pips away from current price. If the monthly support holds bearish pressure, then we can expect the Pound to advance at least up to 20-day SMA at 1.6062.

• Traders’ Sentiment

  Traders’ perceptions of the pair’s future development changed slightly to the bearish side, as 65% of them are holding long positons on the Pound, compared to 68% one day ago.

USD/JPY advances through 2008 high

“It had become increasingly apparent that what the BOJ was doing wasn’t enough and they needed to do more and it’s always been a question of when they would do that. It’s an excellent outcome.”

- AMP Capital Investors Ltd. (based on Bloomberg)

• Pair’s Outlook

  The Japanese currency unexpectedly lost very noticeable value during last 24 hours, as it dropped more than 220 pips to reach the monthly resistance line at 111.63 on news from the Bank of Japan. The pair climbed through a number of strong supply areas, including 2014 and 2008 highs. If the pair surpasses the next resistance, it may jump up to monthly R2 at 113.61. Otherwise, the Dollar is set to make a step back and trade below the six-year high.

• Traders’ Sentiment

  While opened positions are still dominated by bears (67%), pending orders both in 50 and 100-pips ranges surged considerably, as now 83% of latter ones are set to buy the Dollar versus the Japanese yen, compared just to 62% on Thursday.

USD/CHF stops growing ahead of up-trend around 0.96

“I don’t think it’s going to be hard to maintain a growth of 3 percent for the fourth quarter.”

- Northern Trust Company (based on New York Times)

• Pair’s Outlook

  The Swiss currency continued to weaken versus the US Dollar, but the currency cross stopped rising in value after reaching the Bollinger band at 0.9613. This level is placed just below the up-trend, which is reinforced by weekly R2 at 0.9652. The USD/CHF pair is likely to have some issues with crossing these levels; however, if the testing is successful, it may grow up to October high and monthly resistance around 0.97. In case of failure, the Dollar will be at risk of the decline down to the weekly pivot point below 0.95.

• Traders’ Sentiment

  Bulls continue have the majority of opened positions (53%), while pending orders improved to become positive in the last 24 hours, as 56% of them in 100-pips range are now set to by the US Dollar.