Daily Technical Analysis for Majors by Dukascopy

[Anastasia DC]

USD/JPY gravitates towards 50% Fibo

"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
Investors sold the American Dollar on Monday, due to uncertainty emitting from the US political debates that day. As a result, the USD/JPY currency pair crossed the nearest demand area, represented by the monthly S1 and the 50% Fibo. However, a significant drop lower would still be an achievement, as it would imply a full-scale breach of the 100.00 psychological level. In turn, the 100.00 mark is reinforced by the weekly S1 and the Bollinger band, also indicating that a fall deeper down is highly improbable today. The base case scenario is a rally, but it is uncertain whether the Buck will be able to climb over the 100.75 level, with technical indicators unable to confirm the bullish scenario.

Traders' Sentiment
Today 64% of traders are long the US Dollar (previously 63%), whereas 61% of all pending orders are to buy the Buck (down from 63%).

 

[Anastasia DC]

Gold attempts to build up bearish potential

"Financial markets judged the first of three American presidential debates a win for Hillary Clinton, as Mexico's peso rallied from a record low, U.S. stock index futures gained and gold retreated."
- based on Bloomberg

Pair's Outlook
Following a non-volatile trading session on Monday, Gold managed to tap at the top trend-line of the three-month descending triangle at 1339.83. XAU/USD is currently approaching 1332.22, the 55-day SMA which will then shift the risk to 1329.53 if broken. The senior wedge bottom trend-line is likely to limit the weakness at 1317.97, which will possibly serve as a starting point for a reversal when the pair begins to move to the top trend-line of the wedge. The triangle, however, suggests that the wedge might be mature enough to break soon, suggesting that a violation of 1317.97 is feasible and could open the way to 1302.08, the bottom trend-line of the triangle.

Traders' Sentiment
Traders have remained almost as bearish on Tuesday as they were on Monday, showing a 55% of positions being long (53% on Monday).

 

[Anastasia DC]

EUR/USD fails to retrace

"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 confirmed its change of track, opening bearish for the second consecutive session. The dip is currently stalled by the 20-day SMA, with risk at 1.1201, the weekly Pivot Point. A cluster made up by the 55-day SMA and the monthly Pivot Point at 1.1185/90 could further reduce bearish momentum or cut the losses entirely for Tuesday. In case the pair accumulates some strength to reverse the gloomy themes, 1.1260 will be a level to watch, putting 1.1280/84 into perspective if broken. Aggregate technical indicators as well as the 20-day and 55-day SMA crossover both give out BUY signals, suggesting that the broken channel retracement could still be in the picture .

Traders' Sentiment
SWFX traders are bearish, as 60% of positions are short. Pending commands are bearish as well, with 63% of set up orders being to sell.

 

[Anastasia DC]

GBP/USD attempts to stabilise above 1.30

"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
The GBP/USD pair surprised with its performance yesterday, having recovered from intraday lows and retaken the 1.30 level. However, technical studies keep suggesting the Cable is to edge lower. Today's US fundamental data could be the catalyst for a possible decline, in which case the main support will still be the cluster around 1.2880. Taking into account that the Sterling persistently remained above the 1.2950 level for more than a week, another bullish development would not be a surprise. Technically, the 1.31 major level should be the upper border, but 1.3150 is not out of the question either.

Traders' Sentiment
Market sentiment almost reached a perfect equilibrium, with bulls and bears taking up 51% and 49% of the market, respectively. Meanwhile, the portion of buy orders remains unchanged at 56%.

 

[Anastasia DC]

USD/JPY under the risk of falling under 100.00

"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 Greenback struggled on Tuesday, barely managing to post any gains against the Japanese Yen. As a result, the nearest upper and lower borders remain unchanged, with the 50% Fibo and the monthly S1 forming a cluster around 100.80, while the weekly S1 and the Bollinger band represent support just under 100.00. According to technical indicators, however, risks are skewed to the downside, which implies the pair's fall back to post-Brexit lows. In either way the USD/JPY pair remains in a bearish trend, thus, a rally is likely to be short-lived, with the 102.00 mark being the ultimate resistance.

Traders' Sentiment
Today 64% of traders are still long the US Dollar, unchanged since yesterday. As for the purchase orders, their share increased from 61 to 65% over the past 24 hours.

 

[Anastasia DC]

Gold surrenders to triangle

"Raw-materials producers led declines as gold slumped 0.8 percent and an index of gold miners lost 2.4 percent."
- based on Bloomberg

Pair's Outlook
The three-month triangle proved its merit not only by limiting access to levels above 1339.61, but by causing a 1.1% dive right trough levels of significance to close at 1325.81. Opening with little volatility, Gold showed signs that an extension of the bear-trend might be on the way with some high impact fundamental data releases pushing the metal around against the Dollar on Wednesday. The lack of demand pressures in between opens the way to 1317.89, the bottom trend-line of the wedge, suggesting that the triangle has overpowered the senior wedge which could be mature enough to give in to the junior triangle.

Traders' Sentiment
Traders have decreased their bearishness, as 52% of open positions are short on Wednesday, compared to 55% on Tuesday. In the meantime, pending commands remain bullish, as 65% of set up orders are to buy.

 

[Anastasia DC]

EUR/USD aims for 1.1280 on Thursday

"Mario Draghi is facing some of his prominent German opponents as lawmakers in Berlin get a rare chance to press him for an eventual end to record-low interest rates in the euro area."
- based on Bloomberg

Pair's Outlook
The common European currency was set to surge against the US Dollar on Thursday morning, as it faced no resistance up to the level of 1.1280, where the first weekly resistance is located at. Previously, on Wednesday the currency exchange rate experienced high volatility, as it was trading in the range from 1.1182 to 1.1236. In the meantime, daily aggregate technical indicators support a surge of the rate by the end of today's trading session.

Traders' Sentiment
SWFX trader sentiment remains unchanged, marking a week of steady bearish sentiment, as 60% of open positions are short on Thursday. In the meantime, pending commands have become identical to the open positions, as 60% of set up orders are to sell the pair.

 

[Anastasia DC]

GBP/USD: downside risks still present

"We remain fundamentally bearish on the GBP as we expect the Brexit process to weigh on growth and the government's stance to compromise prospects for the services industry."
- Scotiabank (based on PoundSterlingLive)

Pair's Outlook
The Cable surprised with its performance on Wednesday, as it remained completely flat after experiencing some downside pressure. The pair is expected to experience another leg down today, with technical indicators bolstering this possibility. The weekly PP on top of the 1.30 major level remains the closest support, whereas the key one is still located around 1.2880, represented by the Bollinger band, the weekly and the monthly S1s. However, the key support is unlikely to be reached today, as the 1.2950 level could also limit the losses, as it has been doing for nearly two weeks now.

Traders' Sentiment
Today 55% of traders have a positive outlook towards the Sterling, compared to 51% on Wednesday. The number of buy orders, on the other hand, dropped down from 56 to 51%.

 

[Anastasia DC]

USD/JPY surged after Kuroda's speech

"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
Wednesday ended with the US Dollar adding as little as 25 pips against the Japanese Yen, therefore, unable to climb over the immediate resistance. Earlier today BoJ Kuroda's speech triggered JPY-selling, which is a good sign, as a bullish USD/JPY development would eventually lead to another retest of the descending channel's resistance line. However, taking into account recent similar developments, the pair could still erased all intraday gains and end the day with another bearish outcome. Technical indicators keep giving bearish signals, thus, this possibility should not be ignored, where the 100.00 mark is the main target.

Traders' Sentiment
There are now 65% of traders holding long positions (previously 64%), whereas the share of purchase orders slid from 65 to 47%.

 

[Anastasia DC]

Gold rebounds against trend line

"Gold edged up on Thursday as the U.S. dollar weakened in the wake of an oil producer agreement to curb output."
– based on Reuters

Pair's Outlook
The bullion bounced off the rising wedge pattern's lower trend line and surged on Thursday morning. On early morning, the metal was about to face a resistance cluster from 1,326 to 1,331, which is comprised of both the weekly and monthly pivot points and the 20 and 55-day simple moving averages. Previously, it was possible that the yellow metal will break out from the rising wedge pattern due to the pressure provided by a triangle pattern, and the threat still remains, as the triangle remains active.

Traders' Sentiment
Traders have become neutral on the yellow metal, as 50% of open positions were long on Thursday morning. In the meantime, pending commands were 68% to buy gold.

 

[Anastasia DC]

EUR/USD slowly treading higher on Friday

"Euro-area economic confidence unexpectedly improved in September in a sign the region's recovery is maintaining its momentum."
- based on Bloomberg

Pair's Outlook
On early Friday morning the common European currency once more confirmed the channel up pattern's against the US Dollar lower trend line and moved higher. In general, it can be seen that for the past three consecutive trading sessions the currency exchange rate has been slowly moving northwards while experiencing high volatility, as it rebounded many times against the channel's support line. It is most likely, that the rate will continue these fluctuations and end today's trading higher than the opening price of 1.1222.

Traders' Sentiment
SWFX market sentiment remains unchanged for the sixth consecutive trading session, as 60% of open positions are short. In the meantime, pending commands are 69% to sell the European currency.

 

[Anastasia DC]

GBP/USD in tight range between 1.2950 and 1.30

"We remain fundamentally bearish on the GBP as we expect the Brexit process to weigh on growth and the government's stance to compromise prospects for the services industry."
- Scotiabank (based on PoundSterlingLive)

Pair's Outlook
On Thursday the British Pound weakened against the US Dollar, amid a better-than-expected reading of the US GDP. Basically, the GBP/USD currency pair has been consolidating since the beginning of the week, while holding above the 1.2950 level for more than two weeks. Consequently, a bearish development seems unlikely, but taking into account the fact that the Cable has been trading in a down-trend since the beginning of September, a rally beyond 1.30 would be difficult to achieve. Moreover, technical indicators keep suggesting the pair is to weaken further, but in this case the support line at 1.2932 should be the bottom floor.

Traders' Sentiment
Today 57% of traders are long the Sterling, compared to 55% yesterday. The number of purchase orders, however, slid from 51 to 44%.

 

[Anastasia DC]

USD/JPY struggles to remain above 101.00

"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 pair erased most of intraday gains yesterday, but still managed to close trade above the 101.00 major level. Once again having put the 20-day SMA to the test earlier today, the Greenback was unable to maintain trade above 101.50. This could be a sign of potential weakness, which technical studies are in favour of. The immediate support area, located around 100.80, is unlikely to limit the losses if bears take over today; instead, the 100.32 is the main target, as it kept the pair afloat for two weeks in a row now. Overall, another bullish development will not change the whole picture for the Dollar/Yen, as the bearish trend is to remain intact.

Traders' Sentiment
Bullish traders' sentiment returned to its Wednesday's level of 64%, whereas the portion of buy orders increased from 47 to 60%.

 

[Anastasia DC]

Gold surges after finding support

"Gold inched up on Friday as equities fell, but was on track to end the week down over 1 percent."
– based on Reuters

Pair's Outlook
The yellow metal surged on Friday morning, as the commodity found support by the end of Thursday's trading session. The rebound occurred when the metal approached the first weekly support at 1,315.44. After the encounter the bullion began to recoup some of that day's losses. However, it did not manage to do that, as the day's trading session was ended with losses at 1,318.78. Although, by 5:00 GMT on Friday gold had already touched the 1,324.69 level. It is most likely that the metal will continue the surge up until the level of 1,326.43, where the monthly PP is located at.

Traders' Sentiment
SWFX traders remain neutral on the metal, as 50% of open positions are long. In the meantime, pending commands are 69% to buy the bullion, as traders remain in expectations of a surge.

 

[Anastasia DC]

EUR/USD experiences high volatility

"The euro gained as Deutsche Bank AG shares rebounded on speculation it will reach a lower settlement with the U.S. Department of Justice in connection with an investigation into residential mortgage-backed securities."
– based on Bloomberg

Pair's Outlook
The common European currency is traded against the US Dollar above the newly formed weekly and monthly pivot points, which are respectively at 1.1224 and 1.1230. Previously, on Friday the currency exchange rate experienced very high volatility of an almost 100 pips range, as the pair bounced between 1.1250 and 1.1153 levels. Although, the Euro is still set to surge against the Greenback, in the recent trading sessions the 1.1250 level has showed a lot of resistance, as it has even made the rate change its direction on its own, without the assistance of other resistance levels.

Traders' Sentiment
Traders changed their thoughts after six consecutive sessions of bearishness, as on Monday 59% of open positions were short. In the meantime, pending orders are 58% to sell the pair.

 

[Anastasia DC]

GBP/USD in tight range between 1.29 and 1.2970

"We're back to the Brexit risks. Sterling has taken a bit of knock first. If the concerns become wider concerns about financial market contagion, we will find that the slight softening that we've seen in the dollar trend will be shaken off."
- Mizuho Bank Ltd (based on The Business Times)

Pair's Outlook
Friday ended with the Cable remaining relatively unchanged, as the post-Brexit down-trend limited the gains. Nevertheless, the GBP/USD pair opened with a bearish trend today, but the five-week support line keeps preventing the given pair from edging lower. Furthermore, the support line is also reinforced by the weekly S1, thus, a downside development would be difficult to realise, despite technical indicators retaining bearish signals. However, in case the immediate support area fails to hold, the 1.2882 level should be seen as a potential psychological support level, which kept the Sterling elevated since July.

Traders' Sentiment
SWFX traders' sentiment remains bullish, with 61% of all open positions being long (previously 57%). The share of purchase orders also improved, having risen from 44 to 52%.

 

[Anastasia DC]

USD/JPY: upside limited

"The dollar looks firm against the yen after the 100 yen level was repeatedly tested. However, the upside may be blocked near 102.00 yen."
- BBH (based on Reuters)

Pair's Outlook
On the last day of September the US Dollar managed to remain above the 101.00 major level, posting gains against the Japanese Yen for the fourth consecutive day. Despite that rally, further upside potential is still seen as limited, due to a nine-month resistance line located at 101.85, also being bolstered by a number of other resistance levels. Consequently, the USD/JPY currency pair is expected to surge only 55 pips, but technical indicators suggest otherwise. In case bears take over the market, the 101.00 mark is expected to be the bottom floor, with the weekly PP and the 50% Fibo forming support around it.

Traders' Sentiment
There are 62% of all open positions being long today (previously 64%). Meanwhile, 71% of all pending orders are to purchase the US Dollar, compared to 60% on Friday.

 

[Anastasia DC]

Gold continues the fall on Monday

"Hedge funds and money managers raised their net long position in COMEX gold for the first time in three weeks in the week to Sept. 27."
– based on Reuters

Pair's Outlook
The yellow metal marked a consecutive week of losses, as the bullion fell below the 1,315 level on Monday morning and broke out of the triangle pattern. Previously, a surge was occurring, as the metal had found support. However, the surge was not sustained, and gold managed to only touch the 1,327.90 level. Daily aggregate technical indicators forecast, that the metal will remain unchanged during today's trading session. Such kind of scenario could unfold, if the bullion finds support in the 100-day SMA at 1,310.03 and rebounds back to the 1,318.33 level.

Traders' Sentiment
SWFX traders became bullish on the metal on Monday, as 53% of open positions were long. In the meantime, pending commands remain largely bullish, as 66% of set up orders are to buy.

 

[Anastasia DC]

EUR/USD below 1.12 on Tuesday morning

"Manufacturing in the euro area accelerated in September as incoming new business grew at the fastest pace in three months."
- based on Bloomberg

Pair's Outlook
The common European currency fell below the 1.12 mark on Tuesday morning against the Greenback. The fall occurs due to the fact that the currency exchange rate did not manage to break the resistance cluster made up of the recently formed weekly and monthly pivot points respectively at 1.1224 and 1.1230 levels. At the moment, it is most likely that the currency pair will move lower, as the closest support is located near the 1.1180 level, where the 55 and 100-day SMAs are located at. Although, daily aggregate technical indicators forecast a surge of the pair by the end of the day.

Traders' Sentiment
SWFX traders remain bearish on the pair, as 57% of open positions are short on Tuesday. In the meantime, pending commands have remained unchanged, as 58% of set up orders are to sell.

 

[Anastasia DC]

GBP/USD remains subject to weakness

"GBP/USD is seeing a tiny bounce from the base of a symmetrical triangle at 1.2925. We have a near-term resistance line at 1.3069 (nearby high is 1.3119). And will consider the market remains directly offered below here."
- Commerzbank (based on PoundSterlingLive)

Pair's Outlook
The British currency slumped against the US Dollar on Monday rather unexpectedly, as a March deadline was set for implementing ‘Brexit' yesterday. As a result, the pair slid all the way down to the second support at 1.2845, namely the weekly S2, breaching the falling wedge pattern to the downside. Technical studies today keep giving bearish signals, implying that more weakness could follow. However, in this case the support area around the 1.28 mark is expected to hold, as it is formed by a number of levels, such as the July low, the weekly S3, the monthly S1 and the Bollinger band.

Traders' Sentiment
Bullish market sentiment slightly improved over the day, as 63% of all open positions are now long, compared to 61% previously. Meanwhile, the share of buy orders returned to previous Monday's level of 56%.