- SWFX market sentiment is 73% bullish (+3%)
- Pending orders in the 100-pip range are 54% to BUY
- US Durable Goods and Consumer Confidence
During the previous hours the USD/JPY currency exchange rate broke the short term channel down pattern. However, it revealed something more relevant. Namely, it can be observed that the currency exchange rate is dominated by the strength of various hourly SMAs near the 107.00 mark and the monthly pivot point at 107.19.
The US National Association of Realtors reported that in January the existing home sales slumped for the second month in a row. Contrary to economists' expectations for the number to have surged 0.9%, existing home sales declined 3.2% in the reported month.
It was the largest drop on year-to-year basis over the three-year period. Yet, the demand for housing is increasing due to the boosting labour market, which results as a shortage of buying opportunities for some potential first-time buyers.
Notable US data incoming
Tuesday is a notable day for macroeconomic data release swing traders. The reason for that is the fact that two rather notable data sets are set to be published.
First will be the publication of the US Core Durable Goods Orders data at 13:30 GMT. However, at the time the testimony of the new head of the Federal Reserve will be released. As in, at that time the text is published before the testimony occurs at US Congress.
At 15:00 GMT the CB Consumer Confidence index will be published. This data set release is not as notable as the Durable Goods Orders, but it is still notable enough to cause fluctuations in the financial markets.
Both data releases will be covered by the Dukascopy research team on the bank's live webinar platform. Feel free to join by clicking on the popup window that will appear 10 minutes before the release on our trading platforms. Or it is possible to find the webinar platform by searching – Dukascopy Webinar – on Google.
USD/JPY two possible scenarios
Weaker US Dollar put downward pressure on USD/JPY early on Monday, thus allowing the pair to plunge down to the 106.50 mark. The subsequent hours saw a slight recovery up to 117.00.The rate's movement since mid-yesterday has been bounded between the 55-, 100– and 200-hour SMAs. It is likely that the direction of the breakout determines the US Dollar's movement during the following 24 hours.
Technical indicators are more supportive of the bearish scenario that should send the rate towards the weekly S1 at 106.00—a move that would likewise confirm the upper boundary of a short-term channel down.
On the other hand, a northern breakout of the 100-hour SMA and the weekly PP circa 107.00 is expected to result in a surge up to the 107.50 mark.
Hourly Chart
After the recent review of the pair it was discovered that the daily chart's channel down pattern is better drawn by tilting it a little bit to the downside.
If one draws the channel like that, he can notice that the pair has already confirmed the upper trend line of the channel down pattern. Moreover, the supports near the 107.00 mark are already serving as resistance. Due to that reason expect a decline down to the 104.00 mark during the upcoming months.
Daily chart
SWFX traders are on the long side, as 73% of open positions were bullish during the morning hours. In addition, 54% of pending orders are to buy the Greenback.
Meanwhile, the market sentiment of OANDA traders remains strongly bullish with 66% long positions. In addition, the Saxo Bank's published market sentiment is 56% long
Spreads (avg, pip) / Trading volume / Volatility