- 64% of traders are long the US Dollar
- The share of buy orders increased from 61 to 65%
- The 50% Fibo and the monthly S1 form resistance around 100.80
- The closest support rests around 99.85
- Upcoming events: US Durable and Core Durable Goods Orders, Fed Chair Yellen Testimony, US Crude Oil Inventories, FOMC Members Bullard and George Speeches
Confidence among American shoppers rose unexpectedly to its highest level since the recession in September, official data revealed on Tuesday. According to the Conference Board, the Consumer Confidence Index (CCI) jumped to 104.1 in September, whereas market analysts expect it to come in at 98.6 in the reported period. Meanwhile, the preceding month's reading was revised up to 101.8 from the originally reported 101.1 points. The survey is a closely-followed barometer of consumer attitudes towards business conditions, personal finances, jobs and short-term outlook. The data showed that 27.9% of respondents stated that jobs were plentiful in the ninth month of the year, following August's 26.8%.
Furthermore, only 21.6% claimed that jobs were hard to find, compared to last month's 22.8%. The share of those expecting more jobs to be created in the upcoming months increased to 15.1% from last month's 14.4%, while the share of respondents expecting less jobs declined to 17.0% from August's 17.5%. The proportion of respondents expecting their incomes to worsen fell to 10.3% from 11.0% in the prior month. The US economy is mostly driven by consumer spending, which accounts for about 70% of all economic growth.
US Durable Goods Orders and Yellen's testimony
Wednesday brings a number of events that could potentially influence the USD/JPY pair. First of all, the US Durable Goods Orders, which measure the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more. Such as motor vehicles and appliances. As those durable products often involve large investments they are sensitive to the US economic situation. The final shows the state of US production activity. The Core data, however, excludes the transport sector. Another important event is Yellen's testimony later today. As head of the central bank, which controls short-term interest rates, she has more influence over the country's currency value than anyone else. The testimony is expected to provide insight on the US economic situation and the possible December interest rate hike.USD/JPY under the risk of falling under 100.00
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.Daily chart
As was anticipated, the USD/JPY pair kept trading in tight range between 100.00 and 101.30. The upper border is now bolstered by the 200-hour SMA, thus, a rally further is unlikely, despite the pair expected to eventually put the down-trend to the test again.
Hourly chart
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.
There has been an increase in the number of long positions at other brokers as well. Right now 72% of OANDA clients are bulls, up from 70% recorded on Tuesday. Saxo Bank clients, however, became more bullish than on Tuesday, being that the portion of longs now takes up 70% of the market.
Spreads (avg, pip) / Trading volume / Volatility
Traders are becoming increasingly bullish the Dollar
According to the poll that gathered forecasts between August 28 and September 28, traders expect the US Dollar to appreciate to 106.19 yen in three months' time, while the forecast for November 30 was only 103.30 yen. It is also worth noticing that 84% of all forecasts fall above 102 yen, which is the current spot price. By far the most popular interval is 109.50-111.00, chosen by 24% of all the surveyed, compared to popularity of the 105.00-106.50, 106.50-108.00 and 108.00-109.50 intervals.