- SWFX market sentiment is 51% bearish
- 56% of pending orders in the 100-pip are to SELL
- No data releases with USD impact
On Wednesday morning the USD/JPY currency exchange rate met with the resistance of the 110.20 cluster, as it was forecast on Tuesday. Due to that reason on Wednesday the main question was whether the currency pair manages to pass the resistance cluster or bounce off it.
The Bureau of Labor Statistics simultaneously released three data sets, where Average Hourly Earnings data that came out better-than-expected of 0.3%, compared to the 0.1% in the previous period.
Moreover, Non-Farm Employment Change data came out better-than expected of 223K, instead of economists forecast of 189K, and Unemployment Rate data came out to be less-than-expected of 3.8%.
No relevant US data releases
First release of the week, which might have impacted the US Dollar's strength on Tuesday and subsequently all financial instruments that involve it, was also the last one.
However, macroeconomic data release traders still have data to watch on Wednesday. Namely, the Canadian Trade Balance is set to be published at 12:30 GMT. Moreover, the data release will be covered at 12:20 GMT on Dukascopy Bank's live webinar platform.
USD/JPY reaches for strong resistance at 110.20
The US Dollar was trading sideways against the Yen for the second consecutive session on Tuesday. Its attempt to move below the 109.50 mark was restricted by the combined support of the 55-hour SMA and the monthly PP. As a result, the pair was once again pushed to the upside.The rate had reached the psychological 110.00 level by Wednesday morning. Technical indicators flash bullish signals for this session. This likelihood of this scenario is also strengthened by the fact that the Greenback surpassed the 100-period (4H) SMA early in the morning which could provide additional support. However, the 200-day SMA and the weekly R1 are located at 110.20, so gains could be limited today.
In terms of downside potential, the pair might fall until the 100– and 200-hour SMAs and the weekly PP at 109.20.
Hourly Chart
The rebound has met with the previously set target of the resistance cluster near the 110.20 mark. Due to that reason the rate needs to be watched closely, as it can either break the resistance and gain additional 60 base points or decline back down to the 109.45 mark.
If the cluster gets broken, watch the monthly R1 and weekly R2 near the 110.80 mark. If a bounce off from the resistance occurs, the support of the monthly PP will be targeted next. Meanwhile, in the longer term a large scale ascending channel was still set to prevail.
Daily chart
Swiss Foreign Exchange market sentiment remains slightly bearish, as 51% of open positions were short during the morning hours. Previously, 52% of Swiss traders were short
Meanwhile, 54% of orders were still set to buy.
This indicates that some have opened short term short positions in an effort to possibly profit from the bounce off from the mentioned resistance levels. However, they are set to close the shorts and reopen long positions, as a rebound begins to occur.
The market sentiment of OANDA traders has been constantly largely bullish, as 61% of their traders are still holding long positions. In addition, the proportion of long positions of Saxo bank traders is 56%.
Spreads (avg, pip) / Trading volume / Volatility