- SWFX market sentiment is 67% bullish
- Pending orders in the 100-pip range are 53% to SELL
- Wait for Tuesday
The surge, which followed the breaking of the long term descending channel's upper trend line, has ended. Due to that reason the locations of new patterns is to be speculated, as recent high levels can be used as reference points.
The Bureau of Labour Statistics simultaneously released 3 reports on Friday: average hourly earnings, non-farm employment change and unemployment rate, from which only the first 2 had a notable impact on the exchange rate.
The move up in the currency pair was caused by lower-than-expected average hourly earnings data, while the downtick was driven by better-than-expected non-farm employment change figures.
Empty Monday
Today there are no notable data releases scheduled. If there are events entered into the economic calendar, one can easily ignore them, as none of them could cause a correction in currency exchange rates.
However, look forward to Tuesday, as the first notable event of the week is set to occur during the day. Namely, the US CPI is set to be published at 12:30 GMT.
In addition, the rest of the week will also have notable data releases that the Dukascopy research team will cover on the bank's live webinar platform. In general, each day starting with Tuesday, at 12:30 GMT there will be a data release.
USD/JPY likely to test 106.20
Following a breakout of the descending channel early on Friday, the US Dollar entered a minor period of consolidation against the Yen.This neutral sentiment changed during the Asian session when the pair fell 50 pips in response to various fundamental events. Some downside potential still exists in the market today; thus, the pair could decline down to the 100– and 200-hour SMAs and the upper boundary of a three-month descending channel near 106.20.
Given that no significant fundamentals are scheduled for this session, the US Dollar is unlikely to breach this support.
On the other hand, in case of a strong bullish momentum, gains should be capped near the 107.50 mark where the weekly R1 and the monthly PP are located.
Hourly Chart
There have been new developments in regards to the massive scale channel down pattern. Namely, after looking closely at the way the reference points for the most dominant channel they were adjusted to the exact high levels of the hourly candles. Meanwhile, the reference for the lower trend line was experimented with.
As a result of the experiment, it was discovered that the lower trend line of the most dominant channel has been reached. This indicates that the initial decline of the US Dollar against the Yen in the first months of 2018 has ended.
The above discovery was made on Thursday. Since then the upper trend line of the named channel down pattern has been pierced.
Daily chart
SWFX traders are still on the long side, as 67% of open positions were bullish during the morning hours.
However, trader set up orders remain bullish, as 54% of trader set up orders were to buy the US Dollar in favour to the Japanese Yen.
Meanwhile, the market sentiment of OANDA traders remains strongly bullish with 69% long positions. In addition, Saxo bank traders are 55% bullish in regards to this pair.
Spreads (avg, pip) / Trading volume / Volatility