GBP/USD attempts to maintain trade above 1.46

Technical Analysis

EUR/USD passes 1.14 level on Wednesday

"Forget four rate hikes this year - markets are barely pricing in one rate hike by December. And so, we find the US Dollar lower."

- Christopher Vecchio, Daily FX

• Pair's Outlook
  The Euro continued appreciating against the US Dollar on Wednesday, as the Greenback lost strength due to the fact that a Federal Reserve rate hike is becoming more and more unlikely. The pair jumped last Thursday on disappointing US non-farm payrolls data and gained strength since then. At the moment the currency exchange rate is at 1.4062 and it is moving north to the cluster of resistances around 1.1460 where the weekly and monthly first resistances and the upper Bollinger band are located. However, aggregate technical indicators forecast no changes for the pair today.

• Traders' Sentiment
  SWFX traders have not changed their positions since yesterday, as 56% still have open short positions. In the meantime, pending short orders in the 100-pip range have increased from 51% to 54%.

GBP/USD attempts to maintain trade above 1.46

"In our view, the timing of the next Fed rate hike will depend on the economy continuing to progress, the labour market strengthening further and inflation moving back towards it 2 percent target."

- SEB (based on Business Recorder)

• Pair's Outlook
  The British Pound traded in a rather tight range between the 1.45 and the 1.46 major levels on Wednesday, but with the bearish bias prevailing. The closest resistance area is represented by the 20-day SMA, the weekly and the monthly PPs, however, is unlikely to limit the Cable's movements, as it failed to do so previously. The Sterling remains under the risk of falling towards the ascending channel's support line at 1.4430, unless the interim demand in face of the 1.46 psychological level triggers a rally. In this case the 1.46 will still be the main target, but technical indicators are unable to confirm either scenario.

• Traders' Sentiment
  Market sentiment weakened over the day, as only 52% of all open positions are now long, compared to 58% on Wednesday.

USD/JPY remains on the back foot

"Until the U.S. economy can make the case for a rate rise, the dollar will be at risk of slipping further."

- Western Union Co. (based on Bloomberg)

• Pair's Outlook
  As was anticipated, the USD/JPY currency pair failed to fall beyond the 38.20% Fibo yesterday, but closed still just under the 107.00 mark. Consequently, more bearish momentum is likely to follow, with the 38.20% Fibo at 106.65 to be put the test. The lower Bollinger band is bolstering that support, also suggesting that the exchange rate could drop even beyond 106.50. Meanwhile, technical indicators are also in favour of the negative outcome, as they are giving bearish signals both in the daily and the weekly timeframes, implying that all Monday's gains are to be erased by week's end.

• Traders' Sentiment
  There are three quarters (75%) of traders holding long positions today (previously 73%). At the same time, the number of orders to purchase the US Dollar in the 100-pip range edged higher from 49 to 65%.

Gold above 1,260, as the Greenback weakens

"Federal Reserve Chair Janet Yellen's comments earlier this week have restored a positive outlook for the yellow metal, which was trading under pressure following hawkish comments from the Federal Reserve last month."

- Andy Parker, Market Exclusive

• Pair's Outlook
  The bullion passed the 1,260 price on Tuesday and did not give up its position, as it gained even more strength against the US Dollar on Wednesday. At the moment the yellow metal is close to the 1,262 mark and it was volatile for the first part of Thursdays trading, at one point even passing the 1,266 level. On its way up gold faces the second weekly resistance at 1,274.37 and close by is located the first monthly resistance at 1,278.62. In the meantime, it is supported by weekly R1 at 1,259.11, which could prevent it from losing its Tuesday's gains.

• Traders' Sentiment
  SWFX traders have not changed their sentiment since yesterday, as 51% of positions are still short.

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