- SWFX market sentiment is 66% bullish
- 54% of pending orders in the 100-pip range are set to BUY
- Pair breaks above 109.00 level
- ISM Manufacturing PMI
During the 24 hours up to the middle of Thursday's trading session the US Dollar had recovered against the Japanese Yen. However, the surge seemed to have reached its limits, when it reached the combined resistance of various dominant channels near the 109.60 mark.
The US Federal Reserve announced the decision to keep interest rates at 1.50% on Wednsday, but stated that consumer inflation is likely to accelerate this year, fuelling expectations that borrowing costs would keep climbing under the new Central Bank's Chief Jerome Powell.
Citing strong increases in household spending, capital investment and employment, the Fed anticipated the country's economy to expand at a modest pace and the job market to remain solid in 2018. The Bank is expected to hike rates three times more this year.
ISM PMI
On Thursday there is one data release to focus on. The ISM Manufacturing PMI is set to be published at 15:00 GMT.
The release will be covered on the bank's webinar platform live. Join by clicking on the notification on the JForex platform or find the webinars in the TV section.
USD/JPY points to change in sentiment
The USD/JPY was characterised by low volatility on Wednesday morning which was caused by the failure of bulls to overcome the 55– and 100-hour SMAs for several hours.This resistance cluster was eventually breached, but further advance was limited, as the weekly PP and the 200-hour SMA were likewise located nearby.
In general, the US Dollar is starting to recover against the Yen. However, the high positioning of technical indicators suggest that the most recent movement up might not be sustainable.
Apart from the 200-hour SMA which was already breached several hours ago, the nearest resistance is set by the boundaries of two channels near the 109.70 mark. Even if this area does not hold, the Greenback might reverse near 110.00.
Hourly chart
By looking at the daily chart one can see that the situation remains the same. It can be seen that the next notable supporting trend line is located below the 108.00 mark.
In addition, in the near future the pair will be slowed down by the lower trend line of the already mentioned medium channel down pattern.
Although, if the bounce off from the previously active long term descending channel pattern's lower trend line does not occur, the junior descending channel might only stop the surge at the 110.00 mark.
Daily chart
SWFX traders are on the long side, as 65% of open positions were bullish during the morning hours. Meanwhile, 66% of pending orders are to buy the Greenback.
The market sentiment of OANDA traders remains bullish with 72% long positions (+3%). Meanwhile, Saxo Bank clients are likewise bullish, as 58% (+4%) of open positions are long
Spreads (avg, pip) / Trading volume / Volatility