- SWFX market sentiment is 60% bearish (+1%)
- 51% of pending orders in the 100-pip range are to BUY
- Significant support is located at 113.80
- Upcoming events: US Advance GDP q/q, US Advance GDP Price Index q/q, US Revised UoM Consumer Sentiment
Disappointing data on the US pending home sales caused little changes in the USD/JPY exchange rate. The pair made an ordinary move of 0.04% down to the 113.79 mark, where bulls continued to push it highr to touch the weekly high one again on Friday morning.
The National Association of Realtors revealed that there was no change in the number of pending home sales in September. However, the August's figure was revised down, putting the yearly rate to 3.5% in the observed period. The report showed that the US housing market continued suffering from weaker sales due to tight inventories, while builders cited labour and land shortages as a restraint on construction. Activity is expected to fall further the lack of available properties.
US Advance GDP
The economic calendar for this trading session includes three fundamental events from the United States the most important of which is the US Advance Gross Domestic Product for the third quarter of 2017 published at 1230GMT. Advance GDP Price Index for the given period is published at the same time. Meanwhile, the University of Michigan is to publish its Revised Consumer Sentiment at 1400GMT.
USD/JPY once again tries to break above weekly R1
In result of the weaker than expected Japan's national CPI data release as well as the ECB announcement, the pair found support at the 113.34 level and then resumed the surge. Similarly to Wednesday, it failed to break above the weekly R1, which is located at the 114.19 level.In principle, a release of better than expected information on the US GDP growth later this day might provide a necessary impulse for successful break through the above resistance level.
In that case, bulls will get a chance to elevate the rate to the monthly R1 at 114.75. Otherwise the currency pair is expected to retreat back to the 113.80 level, which represents location of the 55- and 100-hour SMAs, or even lower.
Hourly chart
Despite being driven by strong downside momentum on Thursday morning, the US Dollar managed to turn the situation around and close with gains near the 114.00 mark. The bullish momentum continues to prevail in this session, as well, thus pushing the rate above the weekly R1 at 114.19.
The upper boundary of the ascending wedge is located circa 114.30 – a level that could be regarded as the upper limit for today. However, given that the US is to publish its Advance GDP at 1230GMT, this situation may swiftly change.
No support until 113.20 is restricting the pair from a fall.
Daily chart`
SWFX market sentiment remains bearish on Friday, as 60% of traders are holding short positions (+1%). Meanwhile, pending orders are at equilibrium in this session.
Traders at OANDA are likewise bearish on the pair, as 55% of open positions are short (+1%). Meanwhile, Saxo Bank clients have once again turned bearish with 51% short positions.