Daily Technical Analysis for Majors by Dukascopy

[Anastasia DC]

GBP/USD trades in murky waters

"We think current account financing challenges remain significant for the UK and we continue to target sterling/dollar at $1.24 by quarter-end."
- BNP Paribas (based on Business Recorder)

Pair's Outlook
The British currency experienced a rather sharp decline on Friday, slumping back under the 1.31 major level, thus, failing to settle at a two-week high. The bearish momentum appears to have returned, so the Cable is likely to follow this path today. The weekly pivot point is the nearest support, located at 1.3044, while the second area to trigger a rebound rests only around 1.2880, represented by the Bollinger band, the weekly and the monthly S1s. Meanwhile, technical indicators in the daily timeframe now suggest that a bullish development is also possible. However, in this case the GBP/USD pair is expected to remain below the 1.31 major level, which is bolstered by the 20-day SMA.

Traders' Sentiment
Today 57% of all open positions are long (previously 56%), whereas the number of sell orders edged up from 45 to 59%.

 

[Anastasia DC]

USD/JPY remains on the back foot

"The dollar may lead markets broadly but it's difficult to see the yen fall beyond 101."
- Gaitame.com Research Institute Ltd. (based on Bloomberg)

Pair's Outlook
Having opened with a bullish gap today, the USD/JPY currency pair is now likely to be subject to weakness. The weekly PP, which is the nearest support, will doubtfully manage to keep the pair elevated if the bearish momentum prevails. The next target would then be the weekly S1 at 99.36, unless the 100.00 psychological mark succeeds in providing support before such a sharp drop. Potentially, the Buck could fall even slightly below the 99.00 level, as a solid support is located only around that area. Meanwhile, technical indicators support the possibility of the negative for the US Dollar outcome, as they retain bearish signals.

Traders' Sentiment
Market sentiment barely changed over the weekend, as now 65% of traders hold long positions (previously 64%). At the same time, the share of purchase orders increased from 38 to 55%.

 

[Anastasia DC]

XAU/USD trades below 1,335 on Monday

"Like the stock market, gold and silver bullion for weeks now haven't done much to keep their supporters entertained."
– Mark Lundeen (based on investing.com)

Pair's Outlook
The yellow metal is falling, as it started to lose its value on Friday, when the metal fell from the height of 1,352 to 1,340 level. On Monday morning, gold managed to fall even more, as by 5:00 GMT the yellow metal traded at 1,333, and it had touched the newly formed weekly S1 at 1,331.76. However, it looks like the metal rebounded against the support line, as it had been surging in the past hours up to 5:00 GMT, and the daily aggregate technical indicators forecast a northward move for the pair during today's trading session.

Traders' Sentiment
SWFX trader collectively have not changed their mind, as, just like on Friday, 52% of open positions remain short on Monday. In the meantime, pending orders are 52% long.

 

[Anastasia DC]

EUR/USD struggles below 1.1350 on Tuesday

"The Euro may be vulnerable to losses after the appearance of a bearish Harami candlestick pattern having advanced to a two-month high against the US Dollar."
– Ilya Spivak (based on Daily FX)

Pair's Outlook
The Euro once more approaches the resistance put up by the monthly R2 at 1.1353 against the US Dollar, as the currency rate found support on Monday in the combined support cluster made up of the lower trend line and the weekly pivot point at 1.1281 and the monthly R1 at 1.1263. By 5:00 GMT the currency rate was at 1.1336, and it was surely set to surge at least up to the monthly R2. In addition, daily aggregate technical indicators support a surge during today's trading session. Moreover, the pair is close to being overbought, as the number of open long positions decreases.

Traders' Sentiment
SWFX traders have not changed their outlook on the pair, as 63% of open positions remain short on Tuesday. In the meantime, pending commands are 54% short.

 

[Anastasia DC]

GBP/USD to put weekly PP to the test

"Despite the already meaningful fall, and very cheap valuation levels, we still look for more sterling downside in coming months, both against the euro and the dollar."
- ING (based on Business Recorder)

Pair's Outlook
The Cable overperformed on Monday, having reached the 1.3150 level, rather than remaining under the 1.31 mark. Another rally will be difficult to achieve, as the nearest resistance is now represented by the monthly PP at 1.3170, which successfully kept the GBP/USD currency pair from advancing since the beginning for three weeks now. Consequently, a bearish development is quite possible, in which case the 20-day SMA right on top of the 1.31 mark will be the nearest support, but is unlikely to limit the losses if those occur. Meanwhile, technical indicators are unable to provide a clear sense of direction today.

Traders' Sentiment
There are 54% of traders being long the Sterling today (previously 57%), whereas the share of sell orders remains unchanged at 59%.

 

[Anastasia DC]

USD/JPY subject to more weakness

"The dollar may lead markets broadly but it's difficult to see the yen fall beyond 101."
- Gaitame.com Research Institute Ltd. (based on Bloomberg)

Pair's Outlook
Monday's decline caused the USD/JPY currency pair to almost completely erase the bullish gap. Moreover, the Buck crossed the immediate support yesterday, leaving the door open for a fall below 100.00 level, as today the closest area to limit the losses rests only at 99.36, namely the weekly S1. Technical indicators also suggest the pair is to edge lower, as they retain bearish signals in all timeframes. Ultimately, the Greenback could continue sliding down to around 0.96, where the lower border of the descending channel pattern is located, unless the tough support area around 98.70 triggers a rebound.

Traders' Sentiment
Market sentiment slightly improved over the day, as 67% of all open positions are now long, compared to 65% yesterday. The portion of buy orders, however, lost 1% point, having fallen to 54%.

 

[Anastasia DC]

Gold threads lower on Tuesday

"Like the stock market, gold and silver bullion for weeks now haven't done much to keep their supporters entertained."
– Mark Lundeen (based on investing.com)

Pair's Outlook
The yellow metal set a downward course on Friday, and the fall continues into Tuesday, as the metal was moving lower near the level of 1,338.40 by 5:00 GMT. However, the bullion previously had reached the 1,331.76 level, where the first weekly support is located at. The commodity rebounded against the first weekly support and moved back up during Monday's session. However, the before expected rebound ended at the 20-day SMA at 1,340.61 when gold moved lower. During Tuesday's trading session it is expected that the metal will test the resistance put up by the SMA once more.

Traders' Sentiment
SWFX traders enter a third session of unchanged bearishness on the metal, as 52% of open positions are short on Tuesday. In the meantime, pending orders have increased to 59%, compared to Monday's 52%.

 

[Anastasia DC]

EUR/USD breaks out of pattern on Wednesday

"Seesaw price action since the beginning of the week seems to reflect pre-positioning ahead of a much-anticipated speech from Fed Chair Janet Yellen at the Jackson Hole Symposium on Friday."
– Ilya Spivak, Currency Strategist (based on Daily FX)

Pair's Outlook
The common European currency had been trading against the US Dollar in a channel upward pattern since July 4, and the pair broke out of the pattern on early Wednesday morning. The currency exchange rate reached the monthly R2 at 1.1353 on Tuesday, as it was forecasted. However, the rate bounced off the monthly R2 and began a decline. At the moment, it is most likely that the currency pair will continue to fall until it reaches the weekly PP at 1.1281 and monthly R1 at 1.1263, which will provide support.

Traders' Sentiment
SWFX traders mark the third consecutive session of unchanged bearishness, as 63% of open positions are short on Wednesday morning. In the meantime, pending commands are 55% short.

 

[Anastasia DC]

GBP/USD to make a U-turn

"Overall, GBP is expected to remain under pressure in the next several days unless it can move and stay above the 1.3186 high."
- UOB (based on PoundSterlingLive)

Pair's Outlook
The US Dollar was dragged down by a poor reading of the Manufacturing PMI on Tuesday, allowing the Sterling to take the upper hand and breach the monthly PP resistance level. As a result, the Cable reached the 1.32 major level, where supply was sufficient to limit the rally. The GBP/USD pair is now expected to make a U-turn, ignoring the monthly PP, which is now providing support. Potentially, the bearish momentum today could last until the Pound touches the 20-day SMA on top of the 1.31 mark, although a close around 1.3140 is the base case scenario.

Traders' Sentiment
Bears are now in the majority, taking up 53% of the market, compared to 46% on Tuesday. Meanwhile, the portion of orders to sell the Cable increased from 59 to 61%.

 

[Anastasia DC]

USD/JPY on the edge of falling under 100.00

"The currency market remains highly skeptical of any Fed tightening and the greenback remains under pressure across the board."
- BK Asset Management (based on Business Recorder)

Pair's Outlook
The Greenback managed to remain above the 100.00 major level on Tuesday, ultimately closing with an eight-pip loss. The US Dollar is expected to be exposed to more weakness today, as price once again opened just under the weekly PP, where supply is strong. However, the 100.00 mark remains a tough support, which will be difficult to pierce. Provided there is sufficient impetus, the USD/JPY currency pair could fall towards 98.75, where the weekly S2, the monthly S1 and the Bollinger band form an even stronger demand area. Technical indicators are bolstering the possibility of the negative outcome today, as they retain bearish signals.

Traders' Sentiment
Both bullish market sentiment and the share of buy orders remain unchanged, taking up 67% and 54% of the market, respectively.

 

[Anastasia DC]

Gold continues to fall on Wednesday

"Gold price bounced off the 61.8% Fibonacci retracement and is back testing the broken triangle area at $1,340-50."
- Alexandros Yfantis, portfolio manager and trader (based on investing.com)

Pair's Outlook
The yellow metal is in its fourth consecutive session of losses, as it continues to bounce around the 1,340 level. The metal is forced to move downwards due to the fact that the 20-day SMA at 1,339.79 is pressuring it to move lower. However, it can only continue up to the moment, when the bullion reaches the support level below at 1,331.76, which is represented by the weekly S1. In the previous two sessions, the metal bounced between the newly formed weekly S1 and a compound resistance made up of the weekly and monthly pivot points near the 1,345 level.

Traders' Sentiment
Traders continue to be bearish on the yellow metal, as 53% of open positions are short on Wednesday. In the meantime, pending commands are 57% long.

 

[Anastasia DC]

EUR/USD rebounds at 1.1263 on Thursday

"The euro-area economy showed little sign of impact from the U.K.'s decision to leave the European Union with a second month of gains in the Purchasing Managers Index to 53.3 in August."
– based on Bloomberg

Pair's Outlook
On Thursday morning the currency exchange rate found support in the monthly R1 at 1.1263 and slightly rebounded. However it faces the weekly PP at 1.2806 from the upside, which might mean a flat trading session for the rate during today's trading session. However, afterwards it is most likely going to surge, as the SMAs approach from the south. Previously the common European currency depreciated against the US Dollar on Wednesday to such an extent that it fully discarded the previous pattern.

Traders' Sentiment
SWFX traders have slightly decreased the bearish sentiment, as 61% of open positions are short on Thursday, compared to 63% the previous session. In the meantime, pending commands are 55% short.

 

[Anastasia DC]

GBP/USD in limbo ahead of US data

"The strength of post-Brexit data, much monetary easing already priced into the rates market and a generally weak dollar should allow pound to rally towards $1.3450."
- Morgan Stanley (based on Business Recorder)

Pair's Outlook
The Sterling appreciated against the US Dollar for the third consecutive day yesterday, but with each rally being smaller than the preceding one, suggesting that a reversal is due. Stronger US fundamentals could trigger a Cable sell-off today, with the exchange rate returning under the 1.32 major level. However, technical studies are unable to confirm this outlook, as they retain mixed signals, but a possibility certainly exists. In case of a bearish development, the nearest significant support will be the monthly PP at 1.3170. Contrariwise, disappointing US data might only further strengthen the given pair, providing an opportunity to reclaim the 1.33 mark.

Traders' Sentiment
Today 56% of all open positions are short (previously 53%). Meanwhile, the share of sell orders declined from 61 to 56%.

 

[Anastasia DC]

USD/JPY muted in anticipation of fundamental data

"It [a recovery towards 102.00] probably won't happen on the back of Yellen's comments but it could happen over the next few weeks as long as 99.00 holds."
- BK Asset Management (based on Reuters)

Pair's Outlook
The USD/JPY currency pair succeeded in remaining above the 100.00 psychological level for another day, but risks of a slump even below that area persist. Technical indicators keep giving bearish signals in all timeframes, suggesting that a set of US fundamental data could disappoint today and drive the Buck lower against the Japanese Yen. The weekly PP, which is now the nearest support, will then most likely fail to hold the losses, with all focus shifting to the support cluster around 99.50, represented by the weekly S1 and the Bollinger band. On the other hand, potential gains will doubtfully exceed the 101.20 mark, where the 20-day SMA coincides with the weekly R1.

Traders' Sentiment
There are now 68% of traders holding long positions, compared to 67% yesterday. The number of buy orders, however, slid from 54 to 52%.

 

[Anastasia DC]

Gold falls and increases volatility on Wednesday

"As soon as we get some type of supportive candle, I more than willing to jump into this market because I believe in the longer-term uptrend."
– Christopher Lewis, Analyst (based on FX Empire)

Pair's Outlook
The yellow metal stopped the fluctuations around the 1,340 level, in which it had been in for the past weeks, as the metal fell on Wednesday due to being pressured by the 20-day SMA from the downside. In the fall the bullion almost reached the weekly S2 at 1,322.63 and ended the session at 1,326.32. On Thursday morning gold has rebounded against the weekly support level and slightly surged, as it has encountered the 55-day SMA at 1,327.31. As the metal is pressured between the two levels, it is most likely going to remain unchanged during today's trading session.

Traders' Sentiment
Traders remain slightly bearish on the metal, as 52% of open positions are short on Thursday. However, pending commands are clearly bullish, as 63% of placed orders are to buy.

 

[Anastasia DC]

EUR/USD breaks resistance at 1.1281 on Friday

"EUR/USD may be preparing for a substantial mark-up."
– Jamie Saettele CMT (based on Daily FX)

Pair's Outlook
The common European currency started Friday's trading session just below the weekly pivot point at 1.1281. However, without any fluctuations to the downside, the currency exchange rate broke the resistance provided by the pivot point. The currency pair had broken the resistance also on Thursday. At the moment, the pair faces no resistance up to the level of 1.1353, where the second monthly resistance is located at. Moreover, aggregate technical indicators forecast a surge for the day. These facts combined assure that the rate is going up.

Traders' Sentiment
Traders remain bearish on the pair, as 62% of open positions are short on Friday. However, in the past sessions it seems to be slowly moving to the bullish side. In the meantime, pending orders are 57% short.

 

[Anastasia DC]

GBP/USD attempts to reclaim 1.32

"The strength of post-Brexit data, much monetary easing already priced into the rates market and a generally weak dollar should allow pound to rally towards $1.3450."
- Morgan Stanley (based on Business Recorder)

Pair's Outlook
The GBP/USD currency pair declined on Thursday, amid stronger-than-expected US fundamentals boosting the American Dollar that day. As a result, the pair slid back under 1.32, but technical indicators retain mixed signals, creating a possibility for another rally. Another bullish outcome would mean a breach of the immediate resistance, namely the weekly R1, opening the door for a surge towards the 1.33 major level and perhaps even towards the second resistance area around 1.3350. However, we should not rule out the Cable experiencing another leg down, leading to a break through the monthly PP at 1.3170.

Traders' Sentiment
Traders' sentiment remains bearish, now at 58%, compared to 56% on Thursday. At the same time, the portion of orders to acquire the British Pound increased from 44 to 58%.

 

[Anastasia DC]

USD/JPY in limbo ahead of Yellen's speech

"If Yellen shows less confidence about the U.S. economy, maybe people would like to buy the yen more, but I also think there are longterm investors who step in to buy dollars whenever it falls below 100 yen, so I think it will stay around current levels for a while."
- Masashi Murata, BBH (based on Reuters)

Pair's Outlook
During the previous three days the USD/JPY currency pair remained almost completely muted, awaiting for the Fed president to speak today. According to technical studies and other data, Yellen is likely to be dovish, which would lead to another US Dollar sell-off. Moreover, the Buck then risks falling under the 100.00 yen level, with the nearest area to limit the losses being the cluster around 99.45, represented by the weekly S1 and the Bollinger band. A breach of this area would expose the 99.00 mark, as well as the second support area circa 98.70, which is the final obstacle before the Greenback could begin falling towards the descending channel's lower border around 95.50.

Traders' Sentiment
Bulls remain in the majority, taking up 70% of the market today. Meanwhile, 61% of all pending orders are to purchase the Buck.

 

[Anastasia DC]

Gold remains squeezed in on Friday

"Interest in the precious metal continues to grow, with funds adding 43 million shares in the SPDR Gold ETF during the second quarter, after a 46 million-share gain in the first quarter."
– based on Bloomberg

Pair's Outlook
The yellow metal changed direction on early Friday morning, as it found support in the second weekly support level at 1,322.62, and the metal is most likely to surge to the 55-day SMA at 1,328.15. Previously gold fluctuated around these two levels, as the commodity finds support in the weekly S2 and in the meantime is not capable of breaking the 55-day SMA. The bullion got squeezed in between these two levels on Wednesday, as the metal fell to the weekly S2. However, daily aggregate technical indicators forecast a downfall for the bullion during today's trading session.

Traders' Sentiment
Traders are neutral bearish on the pair, as 51% of open positions are short. In the meantime, pending commands are 60% long on Friday.

 

[Anastasia DC]

EUR/USD at 1.12 mark on Monday morning

http://i.imgur.com/Kw0Z6xu.png

"Janet Yellen delivered in her late Friday night speech, signalling the possibility of TWO rate hikes before the time ball in NYC is dropped on 2016."
– based on WBP Online

Pair's Outlook
The common European currency depreciated against the US Dollar on Friday, as chairwoman of the Federal Reserve, Janet Yellen indicated at two not only one rate the central bank's rate hikes until the end of this year. Although, the pair opened Monday's trading session at 1.1174, it surged afterwards to 1.12 mark and is most likely to continue to recover the previous losses. Janet Yellen's speech seems to have provided a buying opportunity for the bulls.

Traders' Sentiment
SWFX traders have not changed their sentiment since Friday, as they remain bearish with 62% of open positions being short on Monday. In the meantime, pending commands have become more bearish, as they are 65% to sell, compared to 57% short orders on Friday.