- SWFX market sentiment is 58% bearish
- 52% of pending orders in 100-pip range are set to BUY
- 54% of traders are bullish on the Dollar
- Upcoming Events: ISM Non-Manufacturing PMI
Despite the US Senate vote on tax reform, the Dollar did not manage to gain much value yesterday. The main barrier for an active plunge was set by the lower trend-line of a one-month long ascending channel that is expected to continue providing support until the rate receives a proper fundamental impulse.
The Greenback made the last attempt to rise against the Yen before falling sharply on non-negative US economic data. The USD/JPY added 5 base points, ahead of the sharp fall to the 111.74 area. However, bulls put the pair back to the pre-data level of 112.60.
US consumer inflation growth weakened in October, as the hurricane-related increase in purchases of motor vehicles started to fade. The Fed's closely watched inflation measure, the Core PCE Price Index excluding energy and food increased 1.4% year-over-year in October, though the figure undershot the bank's 2% target for more than 5 years. Recent economic data strengthened projections for the Fed to raise borrowing costs once again in December.
Non-manufacturing PMI release
At 15:00 GMT the Institute for Supply Management will release another survey, this time on the US non-manufacturing PMI that is expected to decrease from 60.1 to 59.2.
EUR/USD still trades near 1.1870
Despite positive sentiment related to successful vote on tax bill by the US Senate, the pair both started and ended the day near the 1.1870 mark. The reason for that is related to combined resistance formed by the 55-, 100- and 200-hour SMAs and support provided by the lower trend-line of a one-month long ascending channel. Unless the rate receives an impulse from some fundamental event, such as the Non-Manufacturing PMI data release, it is likely to spend another day in a similar horizontal movement. Apart from that, there is a need to take into account two additional junior descending channels. It is highly possible that their framework taken together with the above technical indicators will create a bearish pressure strong enough to dissolute the ascending channel eventually.
Hourly Chart
On daily chart the pair is still trading at the bottom boundary of a junior ascending channel. If traders interpreted Friday's drop as a fully-fledged rebound from the upper-trend line of a dominant descending channel, the pair will continue moving downwards. In the opposite case, bulls are going to regain momentum and elevate the once again to the 1.1900 mark.
Daily Chart
Market sentiment is bearish
In result of the previous trading session the bearish market sentiment remained unchanged, as 58% of open positions are short now.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 63% bearish and the Dollar is 54% bullish.
Traders of OANDA remain bearish, as 60% (-1%) of open positions are short. Meanwhile, SAXO are bearish on this currency pair with 58% (+0%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility