- SWFX market sentiment is 69% bullish
- 54% of pending orders in a 100-pip range to sell
- Gains could be capped near 109.50
- Upcoming Events: US Unemployment Claims, FOMC Member Dudley speaks, Japan's Final GDP q/q
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.
Unemployment claims at 1230GMT
The economic calendar for this session includes three events that should be taken into account by USD/JPY traders. The US Department of Labor is to release weekly Unemployment Claims at 1230GMT. In addition, the President of the Federal Reserve Bank of New York is to speak about the economic outlook at New York University at 2300GMT. Finally, the Cabinet Office of Japan will publish the country's Final GDP for the second quarter of 2017.
USD/JPY rebounds from monthly S1 at 108.48
In accordance with expectations, most of the previous trading day the currency rate spent in an upward movement, using the weekly and monthly S1, as trampolines. Despite such rebound, the further road to the north is still obstructed by the 100- and 200-hour SMAs and then by the weekly and monthly PP. For this reason, today the pair is expected to resume the fall and once again to try to break through the above weekly S1 at 108.80. In the meantime, there is a need to take into account a certain effect that might appear after publication of data on the Japan's Final GDP at 23:50 GMT. Finally, there is also a need to remember that the rate is simultaneously moving in a senior descending channel and still hasn't formed a new reaction low.Hourly chart
The rate shot up until the 109.40 mark on Wednesday, but was unable to sustain the given level. It seems that bears have taken the upper hand in this session, forcing the US Dollar to target the weekly S1 at 108.80. The upside limit is set by the 20-hour SMA circa 109.60.
Daily chart
SWFX market sentiment has slightly increased on Thursday, as 69% of traders are holding open positions (+3%). Meanwhile, 54% of pending orders are to buy the US Dollar.
OANDA is strongly bullish on the pair, with 67% of its clients having long positions (+1%). Similar viewpoint is held by Saxo Bank clients with 64% long positions (+1%).