- SWFX market sentiment is 69% bullish
- 54% of pending orders in a 100-pip range to sell
- Gains could be capped near 108.49
- Upcoming Events: Minor US data releases
The Institute for Supply Management reported that its PMI for the US non-manufacturing sector posted weaker-than-expected increase to 55.3 in August, following the prior month's figure of 53.9.
An expansion was fuelled by strong increase in new orders and employment, suggesting the weaker job growth registered last month was temporary. Data indicated the US economy is set to gather momentum early in the Q3.
Minor data to be released
This session is relatively calm in terms of fundamentals events. The United States is to release some minor data sets at 1400GMT and 1900GMT. In addition, the President of the Reserve Bank of Philadelphia Patrick Harker is set to deliver opening remarks at a consumer finance research conference at 1245GMT. These events, however, are unlikely to affect the market in any way.
USD/JPY falls from senior channel
Even though a release of information on the Japanese GDP was worse than analysts anticipated, the last day of the week the currency pair started in a sharp downfall. To certain extent, this breakout from a dominant descending channel was triggered by a combined resistance level set up by the weekly and monthly S1 as well as the 55- and 100-hour SMAs. As a result, the next two likely targets for the pair will be the weekly and monthly S2 at 107.33 and 106.98. But starting from the next week, the buck most probably will try to restore some of the lost positions. However, there is a need to take into account that development of this currency pair will quite strongly depend on geological situation surrounding North Korea.Hourly chart
The US Dollar continues to be pressured by downside risks for the second consecutive day. It fell 74 pips against the Yen on Friday morning alone. The pair is currently positioned between the monthly S1 and the weekly S2 in the 108.48/107.34 territory. Meanwhile, the Greenback has surpassed the lower Bollinger band, thus suggesting that a change in sentiment might come during the next week.
Daily chart
SWFX market sentiment has remained at Thursday's level, as 69% of traders are holding open positions. Meanwhile, 57% of pending orders are to buy the US Dollar (+3%).
OANDA is very bullish on the pair, with 66% of its clients having long positions (+1%). Similar viewpoint is held by Saxo Bank clients with 59% long positions (-5%).