Daily Technical Analysis for Majors by Dukascopy

Anastasia DC

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Apr 27, 2016
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EUR/USD extends streak of losses

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"Italy's bonds fell for a second day, leading declines among Europe's higher-yielding sovereign securities, as European Central Bank officials sought to temper investor expectations that they will extend stimulus measures."
- Bloomberg


Pair's Outlook
EUR/USD opened red for the tenth session in a row, eyeing 1.0556, the bottom Bollinger Band – hourly channel bottom trend-line confluence. There is little possibility that a break below the area would allow to extend weakness underneath 1.0525, meaning that we should see some demand pressures distracting the downward motion. The movement is facilitated by SMA pressures from above, and is technically reasoned by the conclusive break below the bottom trend-line of the eight-month descending channel.

Traders' Sentiment
SWFX traders remain bullish on the pair, as 60% of open positions are long on Friday. A different trend emerges when we look at pending orders, as 68% of set up orders are to sell the pair.

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Anastasia DC

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GBP/USD risks falling under 1.24

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"With a 94% probability of a Fed rate hike now priced in for Dec, and almost 1.5 hikes expected in 2017, we think any Fed-fuelled $ upside will only occur if Yellen explicitly rules out scope for running the US economy hot. Risks are that the USD rally takes a breather."
- ING (based on PoundSterlingLive)


Pair's Outlook

For the fourth consecutive day yesterday the American Dollar outperformed the Pound, but with the immediate support cluster remaining intact. The same area, represented by the weekly S1, the monthly PP and the 20-day SMA, keeps providing sufficient support, preventing the Sterling from falling under 1.2370. Consequently, losses are unlikely to exceed 50 pips, although a breach of the immediate support cluster could send the pair all the way down to 1.23 or even lower, as the second target will be the weekly S2 at 1.2225. On the other hand, technical indicators keep giving bullish signals today, suggesting the closest demand area is to trigger a rebound.

Traders' Sentiment
Market sentiment improved further, as 67% of traders are now long the Pound. Meanwhile, there are 65% of pending orders to sell the Sterling.

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Anastasia DC

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Apr 27, 2016
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USD/JPY continues to edge higher

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"Everybody wants to buy the dollar on dips, and is waiting for dips, but there is no dip. The Trump rally can continue, unless some cautious comments come out from the U.S. side."
- Global-info Co (based on Reuters)


Pair's Outlook
The US Dollar successfully rallied against the Japanese Yen on Thursday, managing to prolong the ascending channel pattern for another day. According to technical studies, the USD/JPY currency pair is set for another day of gains; however, there is a solid obstacle on the pair's path around 110.70, formed by the Bollinger band, the weekly R2 and the monthly R3. Technically, the Buck has the potential to overcome the immediate supply area and reach the 111.48 level, namely the channel's upper border.

Traders' Sentiment
SWFX traders' sentiment keeps weakening, as 54% of all open positions are short today, compared to 51% on Thursday. Concerning the pending orders, their share increased from 43 to 52% over the past 24 hours.

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Anastasia DC

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Gold loses upon Dollar gain

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"Gold dropped to its lowest in 5-1/2 months and was set for a second weekly decline, dragged down as the U.S. dollar soared."
– Reuters


Pair's Outlook
Gold extended its weakness on Monday morning following a break below the hourly channel on Thursday. Currently floating around the 1,208.00 mark, the commodity could extend the losses to 1200,77 but is unlikely to slip below. A daily surge is also not out of the picture, as the pair could retrace from the broken trend-line around 1221,80. This is also consistent with the rate being on the fifth wave in the hourly chart. In the unlikely case of a break below the 1200,00 mark, which is strengthened by May lows, the risk will shift to 1193,54 and 1184,24 after that.

Traders' Sentiment
Traders remain slightly bullish, as 54% of open positions were long on Thursday. As optimistic sentiment continues to rise on gold (up from 53%), traders confirm the trend placing 56% of pending orders long.

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Anastasia DC

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USD/JPY to preserve the channel pattern

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"Bias remains to buy USD against the trade-related and open economies including the won and the yen."
- Maybank (based on Business Recorder)


Pair's Outlook

The USD/JPY currency pair has been trading within the borders of an ascending channel pattern for two consecutive weeks now and Friday was not an exception. The Buck successfully breached the monthly R3, but was unable to overcome the 111.00 psychological level. The Bollinger band around 111.37 represents immediate resistance today, but is unlikely to keep the Greenback at bay, with the channel's upper border and the weekly R1 forming a much stronger supply area around 112.30. A decline is also doubtful, as the nearest support, namely the up-trend, is reinforced by the monthly R3. Meanwhile, technical studies are also in favour of the positive outcome today.

Traders' Sentiment

Today 53% of traders are short the US Dollar, compared to 54% on Friday. The number of sell orders surged from 48 to 52%.

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Anastasia DC

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Apr 27, 2016
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EUR/USD marks two straight weeks of losses

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"The move has further to go. We could see some consolidation ahead of the Thanksgiving holidays, but I suspect markets will continue buying into any U.S. dollar pullbacks."
- Vassili Serebriakov, Credit Agricole CIB (based on Bloomberg)

Pair's Outlook
The common European currency was almost unchanged against the US Dollar on Monday morning near the level of 1.06. However, the pair still was in the middle of the descending channel pattern, in which it had been moving lower since encountering the 55 and 100-day SMAs at 1.1135 on third of November. It is most likely that the currency exchange rate will continue to move lower, as the closest support cluster is located around the 1.0520 level. The pair will probably find support there at some point during the week.

Traders' Sentiment
SWFX traders remain bullish on the pair, as 59% of open positions were long on Monday. Meanwhile, trader set up pending commands remain bearish, namely 63% of set up orders are to sell.

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Anastasia DC

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Gold near 1,200 mark on Monday

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"The U.S. dollar climbed on Friday to its highest level since 2003 on continued bets on faster inflation and higher interest rates, while Treasuries resumed a selloff that left yields at their highest levels of the year."
- based on Reuters


Pair's Outlook
The yellow metal edged higher on Monday morning, as it approached the resistance put up by the weekly PP at 1,214.32. However, it seemed like a temporary surge, as the US Dollar was poised to continue to gain and with it decrease the commodity price. It is most likely that the metal will fall by the end of the day's trading session and reach the support cluster located below it around the 1,200 level. The cluster consists of the second monthly support at 1,200.77, May low level at 1,199.58 and the weekly S1 at 1,195.64.

Traders' Sentiment
Trader sentiment remained unchanged on Monday morning, as 54% of open positions remained long, and trader set up orders remained bullish, namely 56% of them were set up to buy.

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Anastasia DC

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GBP/USD remains on the back foot

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"Most clients we talk to remain uniformly bearish on the longer-term pound outlook, partly because they expect the data to deteriorate from here."
- Credit Agricole (based on Bloomberg)


Pair's Outlook
As was anticipated, the breach of the support cluster around 1.2375 on Friday caused the British currency to reach the 1.23 major level, despite trade closing at 1.2349. The GBP/USD currency pair remains subject to weakness, even though technical indicators keep giving bullish signals in the daily timeframe. The monthly PP and the 20-day SMA now form immediate resistance, also being bolstered by the weekly pivot point, thus, making it more difficult for bulls to take over the market. On the other hand, the Sterling has been declining through all of the previous week, indicating that a trend reversal could be on the way. In the meantime, the 1.23 mark is seen as the bottom floor.

Traders' Sentiment
Market sentiment keeps strengthening, as 71% of traders are now long the Pound, suggesting the currency might be overbought.

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Anastasia DC

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EUR/USD trades flat near 1.0630

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"For FX, politics is the new economics. QE has constrained the bond market, distorted equity prices and narrowed yield differentials. This means FX is uniquely placed to reflect political developments."
- David Bloom, HSBC Holding Plc (based on Bloomberg)


Pair's Outlook

The common European currency remained flat against the US Dollar just below the monthly S2 at 1.0632. Previously, on Monday the currency exchange rate managed to rebound and surged to the before mentioned level of significance. That occurred after ten consecutive session of losses, as the Euro declined against the Greenback. However, the attempt to break through it did not succeed initially and continued into Tuesday's trading session. It is likely that the attempt will fail and the rate will retreat by the end of the day, in which case the next support level is at 1.0520.

Traders' Sentiment
SWFX traders remain bullish, as 58% of open positions were long on Tuesday. Meanwhile, trader set up orders are less bullish, as 62% of pending commands were to sell, compared to 63% on Monday.

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Anastasia DC

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GBP/USD in tight range between 1.24 and 1.25

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"We expect to see further GBP appreciation in the short run, as data still resilient to Brexit and US Presidential election improves UK hand in negotiations. But uncertainty will resurface with Brexit negotiations and new trade arrangements."
- DNB (based on PoundSterlingLive)


Pair's Outlook
The British currency was boosted by the UK's new Prime Minister's comments concerning ‘Brexit', causing the Cable to negate almost all previous week's losses. The political factor was not anticipated, but, nonetheless, the pair successfully reached the 1.25 major level again yesterday, implying more Sterling-buying could be on the way. However, technical studies are now giving mixed signals, suggesting that the recent reversed trend, namely bearish, has a solid chance of prevailing. In this case the main target will still be the cluster circa 1.24, represented by the 20-day SMA, the weekly and the monthly PPs.

Traders' Sentiment
The Pound remains overbought, as 71% of all open positions are still long today. At the same time, there are slightly less orders to sell the Sterling, as their share dropped from 66 to 59% over the day.

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Anastasia DC

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Apr 27, 2016
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USD/JPY to keep edging higher

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"Yen is the most comfortable currency to sell against the dollar because yields are rising everywhere but here."
- Nomura Securities in Tokyo (based on Market Watch)


Pair's Outlook
The Buck failed to post gains on Monday, but still managed to preserve the ascending channel pattern, as the immediate support area, namely the monthly R3 and the channel's lower border, remained intact. Technical studies remain in favour of the positive outcome, implying that the US Dollar is to outperform the Yen again today. The pair has been appreciating for a couple of days and experiencing a small decline once in a while, which is believed to be what happened yesterday. Consequently, the pair has the potential to reach the 112.20 level today, formed by the Bollinger band and the weekly R1.

Traders' Sentiment

There are 67% of all open positions are short today, compared to 53% on Monday. At the same time, 57% of all pending orders are to sell the Greenback, five percentage points more than yesterday.

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Anastasia DC

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Apr 27, 2016
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Gold breaks resistance on Tuesday morning

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"With the odds of a Fed rate hike in December approaching 100 percent, gold remains under pressure, as the metal tends to move inversely to rate movements."
- Market Pulse (based on investing.com)


Pair's Outlook
The yellow metal broke through the resistance put up by the weekly PP at 1,214.32 on Tuesday morning. Previously, on Monday and Friday the metal was positioned to fall and find support in the 1,200 level, around which a cluster of levels of significance is located at. However, the bullion rebounded already at the 1,202.83 level. From a technical perspective gold is set now to surge up to the level of 1,225.74, where the weekly R1 is located at. However, daily aggregate technical indicators forecast a red candle by the end of the day.

Traders' Sentiment
Traders have slightly increased their bullish outlook, as 55% of open positions were long on Tuesday morning, compared to 54% previously. Meanwhile, pending commands remain bullish, as 59% of trader set up orders are to buy.

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Anastasia DC

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Apr 27, 2016
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EUR/USD remains flat under 1.0630 level

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"It is the threat of political tail risk and splintering of Europe that could push the euro to reach parity against the dollar for the first time since 2002."
– based on Bloomberg


Pair's Outlook
The common European currency remained flat on Wednesday morning against the Greenback. The currency pair did not even fluctuated, as it stayed below the resistance put up by the second monthly support level at 1.0632. Previously, on Tuesday the rate remained flat by moving only a few pips lower by the end of the session. However, the pair did experience volatility in the range from 1.0582 and 1.0658. Although, in accordance with most technicals, the rate is set to fall by the end of the day.

Traders' Sentiment

SWFX traders remain bullish on the pair, as 56% of open positions were long on Wednesday. Meanwhile, trader set up orders remain as bearish as on Tuesday, as 62% of pending commands were to sell the Euro.

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Anastasia DC

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Apr 27, 2016
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GBP/USD: downside risks persist

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"Financial investors ... are just not as active in the market and don't want to be involved in sterling because of the political risk - they just almost think it's not worth it."
- HSBC (based on Business Recorder)


Pair's Outlook
On Tuesday the GBP/USD currency pair weakened once again, but this time with the support cluster around 1.24 limiting the losses. The Cable appears to have established a broadening rising wedge pattern, currently putting the lower trend-line to the test. Fortunately, the given trend-line is reinforced by the 20-day SMA, the weekly and the monthly PPs, which altogether are likely to prevent the Sterling from sustaining sharp losses. However, a lot depends on today's US fundamentals: should they turn in favour of the US Dollar, the Pound could be seen reaching the 1.23 mark, causing the wedge to lose its credibility.

Traders' Sentiment

SWFX market sentiment improved once again, as 73% of traders now have a positive outlook towards the Pound (previously 71%). As for the pending orders, 59% of them are still to sell the British currency.

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Anastasia DC

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Apr 27, 2016
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USD/JPY struggles to retain its position above 111.00

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"The greenback should continue to benefit from mounting expectations for inflation and a potentially faster pace of Fed rate hikes."
- Commonwealth Foreign Exchange (based on Reuters)


Pair's Outlook
The American Dollar barely managed to post any gains yesterday, but, nonetheless, succeeded in climbing over the 111.00 psychological level. As a result, the ascending channel pattern was prolonged for another day, but the lower trend-line of the channel keeps falling under pressure. In case of another bearish development today the pattern is likely to completely be broken. However, in order for that to occur the exchange rate has to fall below the immediate support, namely the monthly R3, which already prevented two negative outcomes this week. Moreover, technical indicators suggest the USD/JPY pair is to edge higher for another day, thus, preserve the channel pattern.

Traders' Sentiment

There are still 67% of traders being short the Buck, while 54% of all pending orders are to sell the US Dollar, compared to 57% on Tuesday.

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Anastasia DC

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Apr 27, 2016
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Gold trades flat below 1,215 on Wednesday

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"People would want to participate in the equity rally and consolidate their gold positions. Rising treasury yields too would make gold unattractive."
– Helen Lau, Argonaut Securities (based on Reuters)


Pair's Outlook
On Wednesday morning the yellow metal traded just below the weekly PP, which is located at 1,214.32. Previously, on Tuesday the bullion's price fluctuated mostly above the weekly pivot point. However, by the end of the day the commodity price slipped lower and ended the day's trading session at 1,210.87. All factors researched indicate that the metal is set to fall in the upcoming sessions, and, as it was mentioned before, in that case gold would fall to at least the level of 1,200, where the next support cluster is located at.

Traders' Sentiment
SWFX bullish market sentiment continued to increase on Wednesday, as 56% of trader open positions were long. Meanwhile, 57% of trader set up orders were to buy the metal.

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Anastasia DC

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Apr 27, 2016
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EUR/USD finally drops below 1.05

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"The euro and yen looked poised for declines against the dollar regardless of who would win the U.S. election. Both currencies were already in downtrend channels going back to June on technical charts."
– Netty Idayu Ismail, Bloomberg


Pair's Outlook
The common European currency depreciated against the US Dollar on Thursday morning, as the currency exchange rate fluctuated above the 1.0520 mark. Previously, on Wednesday finally occurred the fall of the Euro, which was expected for a long time, as the rate fell to the combined support level of the 2015 December and 2015 April low levels near the 1.0520 level. However, the Euro is positioned to continue falling, as not only the markets increasingly speak about EUR/USD parity, but also the technical indicators forecast a fall for today.

Traders' Sentiment
Traders remain bullish, as 57% of open positions were long on Thursday morning. Meanwhile, 63% of trader set up orders were to sell the Euro.

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Anastasia DC

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Apr 27, 2016
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GBP/USD struggles to climb higher

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"Further gains through 1.2475 would allow the market to test more meaningful resistance in the 1.28-1.30 region, while a move back through ~1.2300 should see a re-test of the range lows."
- Commerzbank (based on PoundSterlingLive)


Pair's Outlook
In spite of extremely good US Durable and Core Durable Goods Orders readings, the Cable still managed to erase all intraday losses and end the day with a 21-pip surge yesterday. This suggests that the demand area around the 1.24 major level, formed by the 20-day SMA, the weekly and the monthly PPs, is strong enough to keep the GBP/USD pair afloat. Moreover, the given support cluster is also reinforced by a seven-week up-trend, which received an additional confirmation on Wednesday. Even though there is sufficient room for another bearish development of approximately 70 pips, technical indicators are unable to confirm this scenario, also suggesting that bulls might take over.

Traders' Sentiment
Exactly three quarters (75%) of all open positions are long today, while the number of sell orders dropped from 59 to 58%.

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Anastasia DC

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Apr 27, 2016
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USD/JPY to reclaim 113.00

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"The momentum for the weaker yen could continue through the end of the year, since we are thinking the Fed will make two or three interest rate hikes in 2017."
- IHS Markit (based on Business Recorder)


Pair's Outlook
Wednesday was a rather productive day for the USD/JPY currency pair, being that it rallied more than 100 pips and, thus, preserved the ascending channel pattern. Consequently, another close in the green zone is the anticipated outcome today, with weekly R2, the channel's upper border, the Bollinger band and the 23.60% Fibo forming a strong resistance area around 113.90. This cluster is expected to be difficult to overcome, but a successful breach is likely to allow the Buck to prolong its bullish momentum. Meanwhile, technical indicators are bolstering the possibility of the positive outcome, as they retain bullish signals.

Traders' Sentiment

For the third consecutive day there are 67% of traders with a negative outlook towards the US Dollar. At the same time, the share of sell orders added 4% points, having risen to 58%.

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Anastasia DC

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Apr 27, 2016
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Gold falls below 1,200 mark

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"Some of the largest investment figures have been winding down their long positions in gold in the past quarter. We are going to see many more followers."
– Mark To, Wing Fung Financial Group (based on Reuters)


Pair's Outlook
As our team has been forecasting for the whole past week, the yellow metal reached the 1,200 mark. Although, the fall was expected to occur earlier than Wednesday. During Wednesday's session the bullion fell by 2.09% and even moved below two additional support levels at 1,195.64 and 1,184.22. It seems that the metal will continue to fall during Thursday's session, as the metal already reached below the weekly S2 at 1,184.22 more than once, and the next support level is located at 1,165.54, where the weekly S3 is located at.

Traders' Sentiment
SWFX market participants were bullish on the bullion, as 57% of open positions were long. Meanwhile, bullish trader set up pending commands have decreased. 53% of set up orders were to buy, compared to 57% on Wednesday.

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