Daily Technical Analysis for Majors by Dukascopy

Anastasia DC

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Apr 27, 2016
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GBP/USD calms before the storm

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"Things look increasingly messy and with the UK government not defining a clear position concerning its exit strategy, uncertainties will remain high. What matters for sterling is the medium-term investment outlook and here the outlook is negative."
- Morgan Stanley (based on Business Recorder)


Pair's Outlook
Monday ended with the Sterling managing to remain above the 1.30 level against the US Dollar, however, more bullish momentum is likely to be very limited. A strong resistance is still located just over the 1.31 major level and no significant impetus for surge beyond that area is present today. Furthermore, ahead of the FOMC meeting on Wednesday no substantial movements are expected, with technical studies bolstering this view. Another relatively small rally is possible, with the 1.31 mark being the ceiling. In case the tide turns, the key support at 1.2885 is to remain out of reach.

Traders' Sentiment
Market sentiment remains unchanged, with 56% of all open positions being long. The portion of orders to sell the British Pound, on the other hand, increased from 52 to 61%.

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Anastasia DC

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Apr 27, 2016
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USD/JPY remains on the back foot

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"The dollar's uptrend won't resume if the Fed's rate hike pace is once a year. A steepening Japanese yield curve, whether or not the BOJ deepens the negative rate, won't bring back the yen weakening trend."
- Sumitomo Mitsui Banking Corp. (based on Bloomberg)


Pair's Outlook
The US Dollar behaved according to expectations on Monday, having fallen back under the 102.00 major level. Overall, the USD/JPY currency pair has been trading in a down-trend for almost a year now, recently putting the descending channel's upper border to the test more frequently. With the resistance being strong, formed by the weekly and the monthly PPs, as well as the trend-line, the 20 and the 55-day SMAs, an upside development is unlikely. Instead, focus should be on the weekly S1 at 101.37, which is the only obstacle on the Greenback's path towards a tough support area around 100.60.

Traders' Sentiment

Bulls lost some numbers over the day, as they now take up 60% of the market, compared to 70% previously. As for the purchase orders, their share once again increased, namely from 29 to 51%.

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Anastasia DC

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Apr 27, 2016
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Gold tests resistance at 1,316.02

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"Gold edged up in Asian trade, extending gains into a second day, on expectations the Federal Reserve will leave U.S. interest rates unchanged at its two-day meeting that kicks off later on Tuesday."
– based on Reuters


Pair's Outlook
The yellow metal is threading higher on Tuesday morning, as by 5:00 GMT it had scored more gains than during the whole Monday's trading session. However, its surge has been hindered by the resistance put up by the weekly pivot point at 1,316.02. Daily aggregate technical indicators forecast a fall of the bullion during today's session. Although it is most likely that the metal will break through the resistance, as it would be consistent with the rising wedge pattern, in which the rate has been for more than a year.

Traders' Sentiment
Traders are neutral on the metal, as 50% of open positions are both long and short in the meantime. However, pending orders have not changed, as 68% of them are set to buy the metal.

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Anastasia DC

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Apr 27, 2016
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EUR/USD falls below SMAs on Wednesday

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"The euro's historical volatility versus the dollar is now the lowest among G-10 currencies, displacing even the Danish krone, which is pegged to the common currency."
– based on Bloomberg


Pair's Outlook

The Euro is trading below a combined cluster of the 55 and 200-day simple moving averages against the US Dollar, as the currency exchange rate fell below the 1.1150 mark. Although, it was forecasted that the rate will remain squeezed in between two clusters of significant levels, the pair also had reached above the pivot point cluster above, and it touched the 1.12 level. The outlook for the Euro looks grim today, as it is most likely to move lower and search for support in the first weekly support level at 1.1106.

Traders' Sentiment
SWFX traders have slightly decreased their bearish sentiment, as 59% of open positions are short on Wednesday, compared to 61% on Tuesday. In the meantime, long pending commands have decreased from 46% to 42% on Wednesday morning.

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Anastasia DC

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Apr 27, 2016
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GBP/USD: key support in focus

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"Things look increasingly messy and with the UK government not defining a clear position concerning its exit strategy, uncertainties will remain high. What matters for sterling is the medium-term investment outlook and here the outlook is negative."
- Morgan Stanley (based on Business Recorder)


Pair's Outlook
Even poor US Building Permits yesterday could not provide the GBP/USD with sufficient strength to keep the pair from falling back under 1.30. With the breach of this major level the Cable falls under the risk of edging lower towards the key support area around 1.2885. This level is important, as not only the weekly S1 coincides there with the monthly one, but also with the support line, which kept the Sterling elevated since its sharp post-Brexit slump. Technically, a decline should be limited by this cluster of supports today; not only that, but an anticipated Fed's dovish statement could also be a catalyst for the exchange rate to negate Tuesday's losses.

Traders' Sentiment
Bulls are barely outnumbering the bears, as 53% of all open positions are long. The portion of buy orders, however, surged from 39 to 65%.

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Anastasia DC

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Apr 27, 2016
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USD/JPY likely to extend stagnation

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"A week and a half ago consensus was dollar/yen higher on BOJ inaction. Now we're seeing a flattening of the risk profile as we go into the central bank meetings and traders are not trying to be too aggressive on one side or the other."
- Citigroup (based on Reuters)


Pair's Outlook
The American Dollar closed at the lowest level in three weeks yesterday, but was still unable to reach the immediate support. Ahead of the BoJ meeting today the USD/JPY currency pair kept edging lower, but the Yen experienced a rather sharp decline once the BoJ announced its new policy framework, aimed to keep inflation rising. The rally, however, was limited by the one-year down-trend, which is also expected to remain intact today. The pair is expected to erase most of its post-BoJ gains, closing around the 102.00 mark. Meanwhile, technical studies retain mixed signals, also suggesting that no dramatic development is due.

Traders' Sentiment
Traders' sentiment remains moderately bullish, now at 61%, while the share of buy orders barely changed itself, having risen from 51 to 54%.

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Anastasia DC

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Apr 27, 2016
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Gold continues to struggle with resistance

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"On Wednesday as investors awaited the outcome of the Bank of Japan's policy meeting and a decision on interest rates from the U.S. Federal Reserve later in the day."
– based on Reuters


Pair's Outlook
The yellow metal continued to try and break the resistance put up by the weekly pivot point at 1,316.02 on Wednesday morning. Although, the metal had reached far above the resistance and touched the 1,320 mark, it retreated afterwards, as the 20-day SMA is approaching at 1,322.16, and it is set to provide additional resistance against the bullion's surge. Daily aggregate technical indicators forecast a fall of the metal by the end of the day's trading session, and the closest support level is at 1,305.52. Both of these factors indicate, that the rising wedge pattern of the metal might be soon broken.

Traders' Sentiment
Traders remained neutral on the metal, with both long and short positions being equal. However, pending commands remain largely bullish, as 66% of set up orders are to buy the metal.

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Anastasia DC

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Apr 27, 2016
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EUR/USD pushes to complete correction

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"The euro's historical volatility versus the dollar is now the lowest among G-10 currencies, displacing even the Danish krone, which is pegged to the common currency."
– based on Bloomberg


Pair's Outlook

Following four attempts at the 1.1150 demand zone, EUR/USD proved levels beneath unattainable, continuing Wednesday's bounce towards the bottom trend-line of the broken three-week and three-month channels, 1.1253 and 1.1270 respectively. The pair is currently threatening to close above the 1.1190/1120 resistance level, opening the way to 1.1223, the upper boundary of the monthly descending triangle, where it could express its weakness with a sell-off to probe the same levels of significance, but from above.

Traders' Sentiment
SWFX traders have not changed the bearish sentiment, as 59% of open positions are short on Thursday. In the meantime, long pending commands have increased from 42% to 46% on Thursday morning.

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Anastasia DC

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Apr 27, 2016
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GBP/USD remains subject to weakness

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"Pressure leaves GBP/USD resting on major support at 1.2920/25, in our opinion; this is effectively the floor of the post June consolidation and the base of a broader bear wedge pattern; loss of support here would tip medium-tem risks decisively lower for the pound."
- Scotiabank (based on PoundSterlingLive)


Pair's Outlook
The Fed's decision to keep rates unchanged weakened the American Dollar, allowing the British Pound to take the upper hand and negate Tuesday's losses yesterday. Despite a bullish development, technical studies now suggest the Cable is to decline, thus, fall back under 1.30. The GBP/USD currency pair is still expected to eventually touch the support cluster at 1.2885, where not only the weekly and the monthly S1s are located, but also the lower boundary of the post-Brexit consolidation trend. The upper border, however, is the July high of 1.3482, which will be the main target once bulls take over again.

Traders' Sentiment
SWFX traders' sentiment remains close to being neutral, as 52% of all open positions are long and the remaining 48% are short. The majority of all pending orders (55%), on the other hand, are to sell the Sterling.

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Anastasia DC

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Apr 27, 2016
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USD/JPY sets eye on 100.00

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"Market is not convinced that the BOJ is doing enough to boost inflation expectations... Overall, this does not change our view of yen strengthening off the back of Japan's strong current account surplus."
- Credit Suisse (based on Reuters)


Pair's Outlook
The Fed put only more pressure on the Greenback yesterday, causing it to weaken against the Japanese Yen. Ultimately, the pair suffered a 138-pip loss, after having reconfirmed the one-year down-trend. However, according to technical studies, more bearish momentum is likely to follow. This is not surprising, as the USD/JPY pair breached a tough support cluster around 100.60. On the other hand, the Buck now faces the 100.00 psychological level, which could still limit the losses, as a strong impetus is required for the Yen to keep outperforming the Buck. In case the 100.00 mark gives in the next targets will be the weekly S3 at 99.44 and the June low of 99.03.

Traders' Sentiment
Today 63% of traders are long the US Dollar (previously 61%). At the same time, the share of buy orders inched up from 54 to 60%.

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Anastasia DC

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Apr 27, 2016
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Gold in battle with 1333.00

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"Federal Reserve Chair Janet Yellen braved mounting opposition inside and outside the U.S. central bank and delayed an interest-rate increase again to give the economy more room to run."
– based on Bloomberg


Pair's Outlook

Gold opened bearish on Thursday after yet another confirmation of the 1307.85 support level some days ago. Currently testing the 1333.00 mark, where the 55-day SMA lies, the metal could escape the falling bias at 1326.43/1325.18, the monthly Pivot Point, weekly R1 and 20-day SMA cluster and set the annual channel bottom trend-line at 1321.72 as its next target. A bounce form 1333.00 would, however, put the weekly R2 at 1341.79 in perspective, painting the technical picture bullish in general with a move in line with the senior channel pattern.

Traders' Sentiment

Traders are bearish on the pair with 52% of short positions However, pending commands remain largely bullish, as 66% of set up orders are to buy the metal.

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Anastasia DC

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Apr 27, 2016
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EUR/USD ready for a surge on Friday

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"Executives at global investment banks in London expect France and Germany will prevail in a tussle over the clearing of $570 billion of euro derivatives and are making plans to deal with the fallout."
– based on Bloomberg


Pair's Outlook
The common European currency was preparing to surge to the 1.1240 level against the US Dollar on Friday morning. Previous session the currency pair already reached above the 1.1240 level, where the weekly R1 is located at. However, the rate retreated from the first weekly resistance after it reached above it, and on early Friday morning the currency exchange rate reached a support cluster below it and began a rebound, as the cluster is located from 1.1202 to 1.1190 and consists of both weekly and monthly pivot points and the 100-day SMA

Traders' Sentiment
SWFX traders remain bearish, as 60% of open positions are short on Friday. In the meantime, pending commands are also bearish, as 59% of set up orders are to sell.

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Anastasia DC

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Apr 27, 2016
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GBP/USD in tight range between 1.30 and 1.31

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"Pressure leaves GBP/USD resting on major support at 1.2920/25, in our opinion; this is effectively the floor of the post June consolidation and the base of a broader bear wedge pattern; loss of support here would tip medium-tem risks decisively lower for the pound."
- Scotiabank (based on PoundSterlingLive)


Pair's Outlook
The British Pound managed to outperform the US Dollar yesterday, but failed to maintain trade above the 1.31 mark. Overall, during this week the Cable's performance has been rather mild, with trade mainly contained between the 1.30 and 1.31 major levels. A bullish development today is unlikely, due to the exchange rate opening closer to a strong resistance, represented by the weekly and the monthly PPs around 1.3120. Consequently, the pair is now expected to make a U-turn and find its way back, closer to 1.30. Technical indicators are also in favour of this outcome, as they retain bearish signals.

Traders' Sentiment
Market sentiment barely changed during the whole week. Today 55% of traders hold long positions, opposed to 52% on Thursday. The share of buy orders, on the other hand, inched up from 45 to 57%.

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Anastasia DC

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Apr 27, 2016
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USD/JPY attempts to retake 101.00

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"Initial USD weakness was met with some better buying as the session grew and this seems to have taken some of the heat out of further risk sentiment."
- IG (based on Reuters)


Pair's Outlook
After a sharp slump on Wednesday the US Dollar succeeded in partially recovering, but the resistance area around 100.80 limited the gains. Today technical indicators keep suggesting the Greenback is to suffer more losses against the Japanese Yen, with the lower limit still being the 100.00 major level, despite the weekly S2 and the Bollinger band forming support at 100.45. However, bulls appear to be refusing to give up, pushing the USD/JPY currency pair higher. In this case gains are likely to be limited by the 101.37 level, namely the weekly S1.

Traders' Sentiment
SWFX traders' sentiment barely changed over the day, as 62% of traders now have positive outlook towards the Buck (previously 63%). At the same time, the number of orders to acquire the US currency lost 14% points, having fallen to 46%.

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Anastasia DC

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Apr 27, 2016
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Gold remains near 1,335 on Friday

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"Gold was little changed early Friday, but remained set for the biggest weekly gain in nearly two months after rising to a two-week high in the previous session."
- based on Reuters


Pair's Outlook
The yellow metal is in a similar position to yesterday, as the metal started Friday's trading session almost at the same level as at the beginning of Thursday's session. Previously, the commodity fluctuated between the resistance put up by the weekly R2 at 1,341.79 and a support level represented by the 55-day SMA at 1,333.03. As gold continued to retreat from the weekly resistance, and the simple moving average had moved lower on Friday morning, it is most likely that the yellow metal will end Friday's trading session with losses.

Traders' Sentiment
Traders have increased their bearishness, as 53% of open positions are short on Friday, compared to 52% on Thursday. In the meantime, pending commands remain bullish, as 64% of set up orders are to buy.

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Anastasia DC

Active Trader
Apr 27, 2016
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EUR/USD consolidation in progress

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"Executives at global investment banks in London expect France and Germany will prevail in a tussle over the clearing of $570 billion of euro derivatives and are making plans to deal with the fallout."
– based on Bloomberg


Pair's Outlook
A break out of the two-month ascending channel has caused a retracement towards the broken trend-line, meaning that 1.1258 remains the ultimate target for the next few days. With no resistance on the way to the trend-line, the rate will bounce to the downside, with 1.1207 as its next target, leaving little to 1.1201 where the weekly Pivot Point lies. Tougher resistance at 1.1190 could deny access to levels underneath, putting 1.1162 into perspective in case of a breakout. If the rate fails to gather enough strength to complete the motion, levels of significance beneath 1.1226 will be targeted right away.

Traders' Sentiment
SWFX traders are bearish, as 60% of positions are short. Pending commands are bearish as well, with 59% of set up orders being to sell.

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Anastasia DC

Active Trader
Apr 27, 2016
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USD/JPY anchored around 101.00

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"The dollar may not be able to defend its number one spot if the economic outlook turns negative, handing its top safe-haven place to the yen."
- State Street Global Markets (based on Reuters)


Pair's Outlook
The USD/JPY's performance brought no surprises at the end of the previous week, with the pair successfully retaking the 101.00 mark. There are doubts that the US Dollar can continue outperforming the Japanese Yen, thus, putting the nine-month resistance line to the test again. Instead the Buck could bounce off from the nearest obstacle, namely the weekly PP, located at 101.33. On the other hand, even though technical studies are also in favour of a bearish development, demand at 100.80, represented by the monthly S1 and the 50% Fibo, could be sufficient to limit the possible losses, while the next target will still be the 100.00 psychological area.

Traders' Sentiment
Today both long positions and buy orders each take up 63% of the market, having risen from 62% and 46%, respectively.

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Anastasia DC

Active Trader
Apr 27, 2016
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Gold to confirm triangle around 1340

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"Gold may be in for a bumpy ride in the final quarter as Republican candidate Donald Trump now has a 40 percent chance of winning the presidential election and investors will be preparing for the possibility of higher U.S. interest rates."
– based on Bloomberg


Pair's Outlook

The yearly wedge proved its strength against the three-week channel XAU/USD had established on its way through the senior pattern. Hovering just above the 55-day SMA at 1332.13, the pair confirmed a three-month descending triangle, which has been building up some bearish potential to make a solid attempt at the bottom line of the senior channel at 1316.98. While the channel trend-line has accumulated strength over the last year, the triangle support (1307.56) is toughened by the 100-day SMA along with several affirmations during the last two years, making it a tough target to break.

Traders' Sentiment
Traders have increased their bearishness, as 60% of open positions are short on Friday, compared to 53% on Thursday. In the meantime, pending commands remain bullish, as 61% of set up orders are to buy.

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Anastasia DC

Active Trader
Apr 27, 2016
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EUR/USD fails at 1.1253

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"While strategists expect U.S. growth to pick up in the aftermath of the election as uncertainty dissipates, sector-specific risks and the magnitude of the potential threat to the bond market vary greatly."
– based on Bloomberg


Pair's Outlook
EUR/USD took up where it left off on Tuesday, proving levels above 1.1253 out of reach with a red candle half the size of Monday's green one. The pair's way south would be a rocky one, if the bullish momentum is indeed captured, presenting 1.1190/88 as the first serious obstacle. Levels 1.1170 and 1.1155 could cause some real trouble, as the SMAs they represent have before, making levels below to less attractive. We would, however, expect the current resistance to break over the next few days to complete the journey towards 1.1275, where the rate would finish the correction of the broken channel trend-line it has been undergoing for almost two weeks already.

Traders' Sentiment
SWFX traders are bearish, as 60% of positions are short. Pending commands are bearish as well, with 61% of set up orders being to sell.

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Anastasia DC

Active Trader
Apr 27, 2016
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34
GBP/USD remains below 1.30

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"We're just three months past the June Brexit vote, and the British pound is sitting awfully close to its post-Brexit lows."
- DailyFX (based on Business Recorder)

Pair's Outlook
Monday ended with the Cable remaining relatively unchanged, amid a weaker US Dollar, mainly due to yesterday's US political debates. Nevertheless, there is no event that could help the Sterling recover from intraday losses today, thus, we should see another leg down, as technical indicators suggest. The key support, preventing the pair from falling to Brexit lows, is still the cluster around 1.2880, represented by the Bollinger band, the weekly and the monthly S1s. At the same time, the weekly PP is keeping the GBP/USD pair from climbing back over the 1.30 major level, being the closest resistance.

Traders' Sentiment

Bulls lost some numbers over the day, as 54% of all open positions are now long (previously 58%). The share of buy orders also declined, namely from 72 to 56%.


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