USD/JPY takes another shot at edging higher

Technical Analysis

EUR/USD's short-term target remains 1.1145

“[…] the more Fed officials stress that each FOMC meeting is “live” the more market price action suggests market participants are beginning to listen.”

- Bank of Tokyo-Mitsubishi (based on WBP Online)

• Pair’s Outlook

  EUR/USD eased for a fourth consecutive working day on Wednesday, but scope of losses remains insignificant. We are still waiting for a testing of the 38.2% Fibonacci retracement of this month's earlier uptrend at 1.1145, which is backed by the 20-day SMA nine pips from below. Within the triangle pattern the long-term goal of the bears is 1.09 where they are going to meet the lower bound of it. On the other hand, aggregate daily indicators maintain a bullish bias, while the 55-day SMA will today cross the 200-day SMA to the upside and will indicate to potentially improving conditions for the Euro.

• Traders’ Sentiment
  
  The bears are holding a 12 pp majority over their counterparts, while pending orders in both 50 and 100-pip ranges rebounded above 50% for the bullish side.

GBP/USD: downside risks higher

“Sterling is clearly underperforming. It’s on the back of a combination of factors -- one of which is the concern that the tragic event could indeed support the campaign to leave the EU.”

- Credit Agricole SA (based on Bloomberg)

• Pair’s Outlook

  ‘Brexit’ fears continued to weigh on the British Pound, even causing it to plunge under the monthly PP yesterday. With the breach of this key support level, the GBP/USD currency pair is now poised for more weakness. The exchange rate is likely to extend its decline until the broadening falling wedge’s lower border is reached around 1.3650. The closest demand area today is located only around 1.3880; even though it lies out of reach, a slump beyond the 1.40 mark is possible. However, we should not rule out the probability of the bullish momentum returning, as technical indicators retain mixed signals.

• Traders’ Sentiment

  A relatively high portion of all open positions is currently long, namely 70%, compared to 63% on Wednesday. Meanwhile, the share of orders to acquire the Sterling slid from 56 to 54%.

USD/JPY takes another shot at edging higher

“The hawkish comments from Fed officials have helped, but participants adjusting their positions before the Easter weekend also appear to be supporting the dollar.”

- Barclays (based on CNBC)

• Pair’s Outlook

  The USD/JPY pair was unable to sustain growth yesterday, resulting in the exchange rate remaining flat over the day. The Buck now risks making a U-turn and putting the immediate support, namely the weekly PP, to the test; with technical indicators still emitting bearish signals in all timeframes. On the other hand, strong fundamentals could not only cause the immediate resistance near 113.00 to be pierced, but even push the US Dollar towards the descending channel’s resistance line around 113.55, also reinforced by the weekly R1. Similarly, a much weaker figure might trigger a sell-off towards the lower border at 119.92.

• Traders’ Sentiment

  Exactly three quarters (75%) of traders are now long the USD. However, the number of sell orders remains high, taking up 71% of the market.

Gold plunges amid hawkish Fed comments

“As their prices fall, markets are turning risk-off. We also should expect some correction given the fast pace of recovery in various asset markets.”

- Dai-ichi Life Research Institute (based on Reuters)

• Pair’s Outlook

  Gold sank the most since July 2015 yesterday, by coming down from the 1,250 area in the beginning of daily trading to below 1,220 later. This is due to substantially higher Greenback in the wake of hawkish remarks by St. Louis Fed head James Bullard. On Wednesday, XAU/USD breached its primary support in face of the weekly S1 and the 23.6% Fibonacci retracement of Dec-Mar uptrend. Now the 1,205 mark is clearly exposed to bearish pressure, but here they will find the monthly pivot point, weekly S2 and the lower Bollinger band, meaning the task to penetrate all of them is going to be difficult at first attempt.

• Traders’ Sentiment

  Many traders have decided to join the bullish side and raised the respective market portion to 42% from only 35% yesterday.

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