- SWFX market sentiment is 59% short (-6%)
- Pending orders in the 100-pip are set to SELL in 59% of all cases
- Economic calendar review at 12:00 GMT
The fresh weekly S1 has managed to provide enough support to push the currency exchange rate higher.
The Census Bureau released Residential Building Permits data that came lower-than-expected of 1.27M, compare to forecasted 1.33M and lower from the previous period.
A member of the California Mortgage Bankers Association, Rob Chrisman said: "More talk of the difficulty builders have finding labor, as well as the constraints they are facing with higher land, labor, and material costs. Yet the Federal Reserve's Beige Book for June noted that contacts in ten out of twelve districts reporting moderate or modest growth."
Quiet day
As it is accustomed on Mondays, no data release will take place during the day. Meanwhile, note that the weekly economic calendar review is set to occur at 12:00 GMT.
USD/JPY likely to edge upwards
The global weakening of the US Dollar caused a 0.90% plunge for the USD/JPY exchange rate on Friday. This bearish sentiment did not allay this morning, thus adding 62 pips to the full decline.At the time of this analysis, the rate was lingering near the weekly S1 and the 200-period (4H) SMA at 110.85. The bottom boundary of a four-month channel is likewise located near this area. The given plunge has sent technical indicators in the strongly oversold territory, thus giving bulls the opportunity to regain some of their lost positions.
If no fundamentals pressure the rate, it is unlikely that the US Dollar falls even lower. The nearest resistance is the 100-period SMA and the monthly R1 at 111.50, while the ultimate goal for this session is the 112.35 area.
Hourly Chart
The US Dollar has been strengthening against the Yen after reaching a new 2017/2018 low of 104.65 late in March. The pair breached the 55-, 100- and 200-day SMAs along the way.
The 200-day moving average provided support for the pair two weeks ago, thus allowing it to breach the prevailing one-and-a-half-year channel down and move towards 114.00.
The following weeks will show if the US Dollar is able to reach the upper boundary of a five-month channel near 115.00. It seems that the current bullish sentiment is starting to allay, thus giving opportunity for bears to send the pair back lower. The nearest support of significance on this long-term chart is the 200- and 55-day SMAs at 110.10.
Daily chart
Traders on the Swiss Foreign Exchange have decreased considerably their bearish sentiment, as 59% of open positions were short on Monday (-6%). Meanwhile, the proportions of total set up orders are shifted to the bearish side, as 53% of pending orders are set to sell.
Previously, a large number of retail traders went short. However, some of the market participants took profits by closing their bearish positions on Monday.
OANDA traders have become neutral on Monday. Meanwhile, Saxo Bank clients are 51% bullish.
Spreads (avg, pip) / Trading volume / Volatility