- SWFX market sentiment is 55% bearish
- 54% of pending orders in the 100-pip range are to BUY
- Strong resistance is located near the 111.80 mark
- Upcoming events: US Preliminary GDP q/q, FOMC Member Dudley to speak, Fed Chair Yellen to testify, US Pending Home Sales m/m
The Conference Board revealed that the Consumer Confidence Index for the US rose to the 129.5 mark in November, reaching the highest level in 17 years.
The strong increase mostly reflected households' optimistic perceptions of the job market. Economists noted that bullish consumers in conjunction with tight job market were reasonable grounds for the Fed to make the interest rate hike in December, despite worries over persistently low consumer inflation growth.
Session full of fundamentals
Various sets of fundamentals are scheduled for this session. The US is to release its preliminary GDP data for the third quarter of 2017 at 1330GMT and Pending Home Sales during October at 1500GMT.
Meanwhile, two speeches are schedules for today. The President of the Federal Reserve Bank of New York William Dudley will participate in a panel discussion about current economic issues at Rutgers University at 1330GMT, while the Federal Reserve Chair Janet Yellen is to testify on the US economic outlook before Joint Economic Committee of Congress at 1500GMT.
USD/JPY breaks two-week long channel down
For the first time in many weeks, reports about another ballistic missile launch made by North Korea did not led to appreciation of the Yen. The news from Asia most probably was beat by a series of positive news coming from the United States.From technical point of view, strengthening of the buck led to breakout through strong resistance formed by the upper boundary of a descending channel together with the 55- and 100-hour SMAs.
Although certain signs point out on formation of a new ascending channel, this view might be premature, as further path to the north is obstructed by resistance zone surrounding the 38.2% Fibonacci retracement level at 111.65 as well the weekly PP at 111.78 that is backed up by the 200-hour SMA. In other words, today the pair is likely to plunge back to 111.20.
Hourly chart
As apparent on the chart, the appreciation of the US Dollar was once again disrupted by the combined resistance of the 100- and 200-day SMAs and the 38.2% Fibonacci retracement.
Given that this session includes important fundamentals, bulls might finally succeed and push the rate higher. However, another resistance barrier - the weekly PP - is also located nearby.
Daily chart
The bearish SWFX sentiment has remained at the same level on Wednesday, as 55% of open positions are short. Meanwhile, 60% of pending orders are to buy the Greenback.
OANDA traders are bullish on the pair, with 56% of open positions being long (unchanged from Tuesday). In addition, the number of open positions of Saxo Bank clients is 56% long (-1%).