- SWFX market sentiment is 54% short
- Pending orders in the 100-pip are set to SELL in 54% of all cases
- Upcoming fundamental events: Philly Fed Manufacturing Index, US Unemployment Claims, FOMC Member Quarles to speak
The US Dollar bounces off the 55-hour SMA with a surge early on Thursday.
The Census Bureau released monthly Retail Sales data that came out better-than-expected of 0.5%, compare to forecasted 0.4%.
Pablo Piovano, an Economist from FXStreet, said: "In addition, the NY Empire State manufacturing index came in above expectations at 22.60 for the current month, a tad lower than June's 25.00 reading. Looking ahead, spot is poised to remain under scrutiny in light of headlines from the Trump-Putin meeting and the upcoming testimonies by Fed's J.Powell on Tuesday and Wednesday."
Quiet day
This trading session is allocated to semi-important fundamental releases from the United States, such as the Philly Fed Manufacturing Index and the weekly Unemployment Claims at 1230GMT. In addition, the Federal Reserve Governor Randal Quarles will deliver opening remarks at the Alternative Reference Rates Committee Roundtable at 1300GMT.
USD/JPY returns to 55-hour SMA
USD/JPY has been moving in a one-week ascending channel. The pair reversed from its upper boundary early on Wednesday and began depreciating in a gradual manner. This fall was not significant, as the Greenback was hindered near the 55– and 100-hour SMAs.The former has worked effectively at supporting the pair on previous occasions; thus, it is likely that the pair continues to move higher in this session, as well. The nearest resistance is the weekly R1 and the 2018 high at 113.50; a move above this cluster is unlikely.
In case bears prevail in the market today and thus breach the 55– and 100-hour SMAs, the US Dollar would be pushed down to the monthly R2 at 112.35. This could point to the beginning of a few-day decline.
Hourly Chart
The US Dollar has been strengthening against the Yen after reaching a new 2017/2018 low of 104.65 late in March. The pair breached the 55-, 100- and 200-day SMAs along the way.
The 200-day moving average provided support for the pair two weeks ago, thus allowing it to breach the prevailing one-and-a-half-year channel down and move towards 114.00.
The following weeks will show if the US Dollar is able to reach the upper boundary of a five-month channel near 115.00. It seems that the current bullish sentiment is starting to allay, thus giving opportunity for bears to send the pair back lower. The nearest support of significance on this long-term chart is the 200- and 55-day SMAs at 110.10.
Daily chart
Traders on the Swiss Foreign Exchange remain bearish, as 54% of open positions were short on Thursday. Likewise, 51% of pending orders are set to sell the US Dollar against the Japanese Yen.
It means that the Swiss retail traders are no longer preparing to open more long positions. Instead, some have even taken profit by closing these positions.
OANDA traders are also bearish with 58% of their positions being short. Saxo Bank clients share the same sentiment with 54% short positions.
Spreads (avg, pip) / Trading volume / Volatility