EUR/USD consolidates around 2003 low

Technical Analysis

EUR/USD consolidates around 2003 low

“The language from Schaeuble and the default risks have come back to compromise any euro rallies.”

- Canadian Imperial Bank of Commerce (based on Bloomberg)

• Pair’s Outlook

  EUR/USD continued to undergo a bullish correction on Thursday. The pair attempted to surge beyond monthly PP, but eventually closed just above 2003 low at 1.0760. Still, short-term outlook focuses on positive development of the Euro. The currency is still likely to try climbing as high as 1.09. At the same time, in case of failure to do that, market expectations will turn back to bearish and EUR/USD will pay attention to recent lows at 1.0520 the next week.

• Traders’ Sentiment

  The total number of bullish opened positions at the SWFX market remains positive at 54% in the morning on Friday. On the other hand, pending orders to buy the Euro against the US Dollar in 100-pip range from the spot are at 45%.

GBP/USD rises on weak Dollar

“This is more dollar weakness, driven by the market coming around to the fact that these economic releases are weaker.”

- TJM Brokerage (based on WBP Online)

• Pair’s Outlook

  Yet again the US fundamentals weighed on the Greenback. As a result, the British Pound climbed up for the fourth day in a row, completely negating last week’s losses. Moreover, the 1.49 barrier was crossed, and the GBP/USD pair closed at 1.4924. On Friday, a smaller rally is expected, although a possibility of a decline exists. The gains should be limited by strong resistance at 1.50, while a fall back towards 1.48 is the likely outcome if data releases disappoint.

• Traders’ Sentiment

  Trader’s outlook towards the Sterling slightly improved, as 43% of all positions are now long (previously 41%). The buy orders are now in the minority, taking up 47% of the market, compared to 63% yesterday.

USD/JPY still under pressure

“Right now position, data flow and policy comments are working against USD, so even committed longs are trimming positions.”

- CitiFX (based on CNBC)

• Pair’s Outlook

  On Thursday, the USD/JPY currency pair slid for the fifth consecutive day due to an increase in unemployment claims in the US. The Greenback experienced some volatility, but in the end there was only a seven-pip decline. Today the Buck is likely to fall deeper and cross the 119 level, while closest support rests down at 118.58, represented by the Bollinger band. Meanwhile, the technical studies are emitting mixed signals on the daily time-frame.

• Traders’ Sentiment

  The share of longs retreated to its Wednesday’s level (74%). At the same time, the portion of purchase orders increased two percentage points, 57% of commands are now to acquire the US Dollar.

XAU/USD hovers around 1,200

“Until upcoming economic data makes the U.S. rate picture a little more clear, we believe gold is likely to remain stuck in choppy, directionless trading in the near term.”

- HSBC (based on CNBC)

• Pair’s Outlook

  It seems that Gold returned into the narrow range between two important technical levels, the 20 and 55-day SMAs. Yesterday, XAU/USD cross attempted to escape these boundaries and even climbed above weekly PP at 1,207. However, bullish impetus used to be weak enough to push the bullion considerably to the north and the price closed at 1,197 by the end of the day. As a result, Gold is likely to remain under 55-day SMA's pressure in the nearest future, thus our outlook remains bearish with a target at monthly PP (1,183) the next week.

• Traders’ Sentiment

  Bulls have a substantial advantage over bears at the SWFX market, as they are holding 75% of all opened trades in the morning on Friday, a gain of two percentage points since yesterday. It represents the most optimistic SWFX sentiment in more than four weeks.