Daily Technical Analysis for Majors by Dukascopy

[Anastasia DC]

EUR/USD recovers to 1.1076 on Monday

"While the EUR/USD traded down strongly on Friday, it failed to break below the bottom of its month-long trading range."
– based on Brooks Price Action

Pair's Outlook
The common European currency erased everything regained against the US Dollar in July on Friday, as the currency exchange rate marked a monthly low at 1.1029. However, on Monday morning the pair started day's trading session higher at 1.1044, and it reached above the weekly PP at 1.1070 by ending Monday's trading session at 1.1075. On Tuesday morning the pair had not moved, as it was trading at 1.1075 by 5:00 GMT.

Traders' Sentiment
SWFX traders have not changed their bearish sentiment, as 53% of all open positions remain short on Tuesday. In the meantime, pending orders in the 100-pip range have slightly shifted to the bullish side, as 63% of pending orders are short, compared to 67% on Monday.

 

[Anastasia DC]

GBP/USD muted ahead of UK CPI data

"We expect front loaded sterling/dollar weakness as the BoE adopts a range of easing measures at their August meeting and choose this pair as our trade of the week."
- Morgan Stanley (based on WBP Online)

Pair's Outlook
Demand, represented by the weekly PP, was sufficient to cause the Sterling to outperform the US Dollar, with the pair adding slightly more than 50 pips yesterday. Positive UK fundamentals could prompt the Cable to move higher again, but technical indicators retain bearish signals, suggesting that a bearish development is more likely. In this case the weekly PP is to fail to keep the GBP/USD currency pair elevated, and a drop towards a one-week of 1.2970 will be possible. The second support, however, rests around 1.2830, formed by the weekly S1 and the one-year trend-line, a cross of which is doubtful.

Traders' Sentiment
Market sentiment slightly weakened again, as 57% of all open positions are now long, compared to 59% on Monday. At the same time, the number of orders to sell the Pound decreased from 65 to 62%.

 

[Anastasia DC]

USD/JPY struggles to remain above 106.00

"Anticipation of a massive stimulus package continues to drive investor sentiment and the ensuing divergence in monetary policy between the Federal Reserve and BoJ continues to weigh on the yen."
- OANDA (based on Business Recorder)

Pair's Outlook
The US Dollar outperformed the Japanese Yen on Monday, with the exchange rate reaching the 55-day SMA, but failing to put the anticipated 106.50 level to the test. Nevertheless, the immediate resistance cluster remains strong, with the USD/JPY pair, technically, expected to undergo a corrective decline today. The nearest support rests only around 103.80, but the 104.50 mark could also prevent the Greenback from edging lower today. Meanwhile, technical indicators are giving bullish signals in the daily timeframe, suggesting that the 107.30 point could be reached, namely the highest level of the immediate resistance cluster.

Traders' Sentiment
Bulls are barely outnumbering the bears, with 51% of traders holding long positions. The portion of purchase orders surged from 49 to 54%.

 

[Anastasia DC]

Gold slightly falls on Monday

"Since the short-term top was set last week just .01 above the prior swing high of the previous week, price action in Gold has continued in a bearish short-term pattern of lower-lows and lower-highs"
– based on Daily FX

Pair's Outlook
The yellow metal slightly lost value during Monday's session, as it moved from 1,332.58 at the start of the trading session to 1,327.72 at the end of the day. However, on Tuesday morning the metal has stopped moving lower, as it met the 20-day SMA, which is located at 1,326.77. Since it is a possible rebound, and the daily aggregate technical indicators forecast a surge for the commodity during today's session, it is likely that gold will move to the weekly PP at 1,343.95. Although, a fall is also possible, in which case the commodity would fall to the weekly S1 at 1,312.88.

Traders' Sentiment
SWFX traders are almost neutral on gold, as 51% of open positions are short. However, pending orders in the 100-pip range are 70% long. Combining these number, it is possible to conclude that a surge is incoming.

 

[Anastasia DC]

EUR/USD fluctuating around 1.10 on Wednesday

"Price has been trading around a flat 200 day average for some time in what's indicative of a ‘trendless' market so a ‘move' is due."
– based on Daily FX

Pair's Outlook
The Euro depreciated on Tuesday against the US Dollar, as the currency exchange rate fell below the weekly PP at 1.1070, while it opened Tuesday's trading session at 1.1075 and ended the day at 1.1019. On Wednesday morning, the pair has slightly moved lower, as it started day's trading at yesterday's closing level of 1.1019 and has moved to 1.1015 by 5:00 GMT. Below the rate is located the weekly S1 at 1.0975, which might be reached, as daily aggregate technical indicators forecast a downwards movement for the pair today.

Traders' Sentiment
SWFX trader combined sentiment has become neutral, as 50% of open positions are long. In the meantime, pending orders in the 100-pip range are 65% short.

 

[Anastasia DC]

GBP/USD: risks skewed to the downside

"Going forward we expect ... sterling to decline on the back of weaker data, BoE easing and tough and long-lasting UK-EU Brexit talks."
- BN Amro (based on Business Recorder)

Pair's Outlook
Despite strong UK inflation figures, the Sterling was unable to outperform the US Dollar, having returned to the 1.31 psychological level yesterday. Today's fundamentals are expected to have a higher impact on the British Pound, but the Cable is now located under a relatively strong resistance area, represented by the weekly PP and the 20-day SMA; therefore, it is uncertain whether positive figures will be sufficient to erase yesterday's losses completely. Moreover, technical indicators suggest the pair is to weaken further, with the nearest support being the weekly S1 at 1.2868, also reinforced by the one-year trend-line.

Traders' Sentiment
Today 56% of traders are long the Pound (previously 57%), whereas the portion of sell orders barely changed, having fallen from 62 to 61%.

 

[Anastasia DC]

USD/JPY faces the 55-day SMA again

"If the BOJ doesn't take any action, the dollar/yen can fall back to 100 again."
- Global-info Co (based on Reuters)

Pair's Outlook
The USD/JPY currency pair remained completely flat on Tuesday, due to lack of impetus, as US fundamentals broadly fell in line with expectations. Moreover, the pair is located under a couple of strong resistances, with the most important level among them being the 55-day SMA, as it kept the Greenback at bay since the previous week. Even though technical indicators imply a bullish development is due, we should not rule out the risks of the Buck falling down to the 105.00 major level, which somewhat acts as an interim support area before the immediate cluster around 104.00.

Traders' Sentiment
Market sentiment remains unchanged, with bulls outnumbering the bears by only two percentage points. Meanwhile, the share of purchase orders also remains the same, taking up 54% of the market.

 

[Anastasia DC]

Gold trading flat on Wednesday morning

"Inflation/currency debasement may be the preferred long-term approach to deal with overwhelming global debt levels (good for gold and silver)."
– Ciovacco Capital Management (based on investing.com)

Pair's Outlook
The yellow metal has been trading almost flat for the past three consecutive trading sessions, as it has stuck around the level of 1,330. At the moment, the metal was trading at 1,331.44 by 5:00 GMT on Wednesday. The situation started three session previously, when the bullion slightly lost value and reached the support provided by the 20-day SMA at 1,326.52. As the commodity keep fluctuating around the same level, the 20-day SMA is closing in on it even more, as on Wednesday the SMA is at 1,327.30.

Traders' Sentiment
SWFX trader sentiment remains unchanged on Wednesday, as 51% of open positions remain short. In the meantime, pending orders in the 100-pip range are 63% long.

 

[Anastasia DC]

EUR/USD at 1.1030 on Thursday morning

"The ECB's rate decision stands out as the big event of the week but certainly not the only one."
– based on Forex Crunch

Pair's Outlook
The common European currency remained almost unchanged against the US Dollar on Wednesday, as during the day's trading session the pair moved slightly lower. The currency exchange rate started day's trading at 1.1019 and ended the day at 1.1013. However, on Thursday morning the pair had already moved to 1.1034 by 4:45 GMT, as it was pressured by the lower Bollinger band at 1.1013, which had moved northward due to yesterday's low volatility. In the meantime, daily aggregate technical indicator continue to forecast a fall for the pair today.

Traders' Sentiment
SWFX traders have come out of the neutral zone, as 51% of open positions on Thursday are long. In the meantime, pending orders in the 100-pip range remain short, as 62% of pending commands were short.

 

[Anastasia DC]

USD/JPY attempts to post more gains

"The dollar continues to benefit from the strength in U.S. equities, which have gone a head above their global peers and are attracting money thanks to high dividends, with strong earnings also helping. This has resulted in 'risk on', sustaining the dollar's rise against the yen."
- IG Securities (based on Reuters)

Pair's Outlook
The Greenback managed to prolong its short-term bullish trend against the Japanese Yen yesterday, but unable to reclaim the 107.00 major level. Today technical indicators retain bullish signals, implying that more bullish momentum could follow; however, weekly studies now suggest that the USD/JPY currency pair could undergo the anticipated decline, causing a drop towards 106.00. A successful breach of the immediate resistance, represented by the weekly R1 and the Bollinger band, is to open the door for a rally towards the 100-day SMA at 108.34, which in turn is the final obstacle on the way to the six-month down-trend.

Traders' Sentiment
Market sentiment is now equally divided between bulls and bears, whereas the portion of buy orders inched higher—from 54 to 55%.

 

[Anastasia DC]

Gold falls to 1,315 on Wednesday

"Gold prices extended overnight losses in North American trade on Wednesday, sinking to a three-week low amid renewed expectations for a Federal Reserve interest rate hike later this year."
– based on investing.com

Pair's Outlook
The yellow metal stopped the previous low volatility movements and dropped on Wednesday from 1,331.10 at the start of day's trading session to 1,315.11 at the end of Wednesday's trading. In addition, the metal touched the weekly S1 at 1,312.88, but it slightly rebounded afterwards. On Thursday morning the bullion continued to struggle with the support level. However, daily aggregate technical indicators forecast no change for the commodity price today.

Traders' Sentiment
SWFX traders have become neutral on the yellow metal, as 50% of open positions are long on Thursday. However, pending orders in the 100-pip range are 72% long.

 

[Anastasia DC]

GBP/USD anchored around 1.32

"Going forward we expect ... sterling to decline on the back of weaker data, BoE easing and tough and long-lasting UK-EU Brexit talks." - ABN Amro (based on Business Recorder)

Pair's Outlook
Strong UK employment figures caused the Sterling to outperform the US Dollar on Wednesday, but with the pair still failing to fully negate Tuesday's losses. Today the Cable opened on top of a relatively strong support cluster, represented by the 20-day SMA and the weekly PP, which should prevent the Pound from falling down again. However, technical indicators retain bearish signals, suggesting that another decline towards the 1.31 mark is possible. On the other hand, in case bulls take over the market, gains are unlikely to exceed the 1.3350 level, despite the nearest resistance located only around 1.3540.

Traders' Sentiment
Once again 57% of traders have a positive outlook towards the Sterling (previously 56%), while the number of sell orders increased further, having risen from 61 to 69% over the day.

 

[Anastasia DC]

EUR/USD slightly surges on Thursday

"USDollar's breakout earlier this week has stalled and failed to gain broad conviction necessary for trend"
– based on Daily FX

Pair's Outlook
The Euro was volatile between the levels of 1.1060 and 1.0980 during Thursday's session against the US Dollar. Most of the volatility was cause by the ECB rate decision and the afterwards press conference. However, it did not change the fact that by the end of the day's trading session the currency exchange rate had moved from 1.1013 to 1.1025, which was a small surge. The surge occurred due to the pair rebounding against the lower Bollinger band in the morning of Thursday. The rate continues to slowly increase on Friday morning, as it had reached 1.1030 level by 5:00 GMT.

Traders' Sentiment
SWFX trader sentiment has not changed on Friday, as 51% of open positions remain long. In the meantime, pending orders in the 100-pip range are still short, as 57% of pending commands are short.

 

[Anastasia DC]

GBP/USD attempts to remain above 1.32

"Going forward we expect ... sterling to decline on the back of weaker data, BoE easing and tough and long-lasting UK-EU Brexit talks."
- ABN Amro (based on Business Recorder)

Pair's Outlook
The GBP/USD currency pair remained relatively unchanged yesterday, having inched only 24 pips higher, amid mixed UK fundamental data results. However, the Cable opened on top a relatively strong support, represented by the 20-day SMA and the weekly PP, which should keep the Pound elevated. Even with better-than-expected fundamentals today, the UK currency is unlikely to climb over the 1.34 major level, leaving the immediate resistance around 1.3485 intact. On the other hand, we should not rule out the possibility of the bearish development prevailing, due to technical indicators in the daily timeframe giving bearish signals. The key bottom target is the 1.31 psychological level.

Traders' Sentiment
Today 58% of all open positions are long, compared to 57% yesterday. Meanwhile, the share of sell orders dropped from 69 to 53%.

 

[Anastasia DC]

USD/JPY on the edge of sustaining more losses

"The dollar continues to benefit from the strength in U.S. equities, which have gone a head above their global peers and are attracting money thanks to high dividends, with strong earnings also helping. This has resulted in 'risk on', sustaining the dollar's rise against the yen."
- IG Securities (based on Reuters)

Pair's Outlook
The Japanese Yen overperformed on Thursday, as the USD/JPY currency pair dropped to the 105.80 level, rather than finding support at 106.00. Nevertheless, the anticipated decline took place, leaving the Greenback under a set of resistances once again. The 38.20% Fibo and the 55-day SMA are now likely to prevent the Buck from edging higher, with risks of the 105.00 major level getting pierced again present. Despite the negative outlook, technical indicators in the daily timeframe retain bullish signals, but yesterday's losses are unlikely to be erased completely even if bulls manage take over.

Traders' Sentiment
Bears are now in the majority, but taking up only 51% of the market (previously 50%). The number of sell orders also takes the larger part of the market, namely 52%, compared to 45% on Thursday.

 

[Anastasia DC]

Gold returns back to 1,330 level on Thursday

"Gold prices were little changed in North American trade on Thursday, staying close to a three-week low hit overnight as market players digested mixed U.S. data and comments from European Central Bank President Mario Draghi."
– based on investing.com

Pair's Outlook
The yellow metal was trading flat at the start of this week, as it slightly fluctuated around the 1,330 level on Monday and Tuesday. However, the metal fell on Wednesday to around the level of 1,312, which seemed to indicate at the bullions new direction. Although, on Thursday gold surged back to 1,330 level, and it continues to be close by it, as the metal was trading at exactly 1,327.40 by 5:15 GMT. It seems that the commodity is most likely to continue to trade flat, as daily aggregate technical indicators forecast no change for it today.

Traders' Sentiment
Traders remain neutral on the yellow metal, as 50% of open SWFX positions are long on Friday. In the meantime, pending orders in the 100-pip range are 67% long.

 

[Anastasia DC]

EUR/USD moves to 1.10 on Monday

"The EUR/USD daily chart has been in a bear trend for 3 weeks. The bears want this to be the start of a trend that will accelerate down below the yearlong trading range. The bulls see this 3 week bear trend as two legs down in a 5 week trading range."
– based on Brooks Price Action

Pair's Outlook
The Euro recouped its Friday's losses against the US Dollar on Monday, as the currency exchange rate moved from the newly set low level of 1.0971 to 1.0995 by the end of Monday's trading session. On Tuesday morning, the pair was more volatile to the downside, as it touched 1.0983 level. However, the EUR/USD pair started surging by 4:45 GMT, as the exchange rate was at 1.10 at that time. In the meantime, daily aggregate technical indicators forecast once again a downfall of the pair.

Traders' Sentiment
SWFX sentiment on Tuesday morning has become neutral, as 50% of open positions are long and also short. In the meantime, pending orders in the 100-pip range are 63% short.

 

[Anastasia DC]

GBP/USD risks breaking the 1.31 psychological support

"Market expectations of the Fed raising interest rates by the end of this year have increased significantly over the last two weeks, and it is likely that the Fed could be conveying a more optimistic message about the U.S. economy."
- National Australia Bank Ltd. (based on Bloomberg)

Pair's Outlook
Once again the GBP/USD currency pair failed to fall below the 1.31 major level, remaining almost completely unchanged on Monday. However, the Cable is expected to experience more pressure today, with risks of the 1.31 mark getting breached now higher. Even though technical studies are neutral in all timeframes, a bullish development is unlikely, as the cluster, represented by the 20-day SMA and the weekly PP, keeps providing strong immediate resistance at 1.3163. A close above the 1.31 major level is still possible, unless losses exceed 40 pips, whereas the nearest support remains out of reach at 1.3011.

Traders' Sentiment
Bullish sentiment keeps fading away, as today 52% of traders hold long positions, compared to 55% on Monday. There is also a decent portion of orders to sell the Pound, namely 59% (previously 73%).

 

[Anastasia DC]

USD/JPY slumps ahead of central bank meetings

"For the yen, what matters most in our opinion is the 'mamizu' or real water content of the fiscal package - more so than the headline total which is easily inflated. The bigger this is, the more stock market supportive it will be and negative for the yen."
- National Australia Bank (based on Reuters)

Pair's Outlook
The US Dollar ended the day with another decline yesterday, falling below the 106.00 mark and completely negating Fridays gains. Earlier today the USD/JPY currency pair unexpectedly slumped below the 105.00 major level, amid growing skepticism that more easing from the BoJ will be successful in weakening the Japanese currency. The immediate support in this case is likely to be completely ignored, with all attention shifting to the cluster around 104.15, formed by the weekly S2, the monthly PP and the 20-day SMA. A drop beyond the 104.00 psychological level is unlikely, as the Buck is expected to partially recover from its current plunge during the day.

Traders' Sentiment
Today 55% of all open positions are long (previously 51%), whereas the share of purchase orders takes up 65% of the market, up from 27%.

 

[Anastasia DC]

XAU/USD ends Monday's trading at 1,314

"Price action from Brexit up to now has formed a head and shoulders, and the neckline is being tested for the third time."
– based on investing.com

Pair's Outlook
The yellow metal moved lower on Monday, as it was volatile around the 1,315 mark during the day and ended day's trading session at 1,314.29. However, on Tuesday morning the metal regained some of its previous losses, as the commodity had surged to 1,319.15 by 5:00 GMT and had tested the resistance cluster located from the upside, which is made up from the weekly PP at 1,323.60 and 20-day SMA at 1,324.13. However, daily aggregate technical indicators forecast no change for the bullion today.

Traders' Sentiment
SWFX trader sentiment came out of the neutral zone, and it became slightly bullish, as 51% of open positions were long on Tuesday morning. In the meantime, pending orders in the 100-pip range were 66% long.