- SWFX market sentiment is 62% bearish
- 54% of pending orders in the 100-pip range are to SELL the US Dollar
- Nearest resistance is located near 113.00
- Upcoming events: US Core Retail Sales
In result of the Fed Funds Rate hike, the currency rate cough downside momentum and slipped straight to the 50% Fibonacci retracement level at 112.45. In nearest future the plunge is expected to continue due to pressure from various technical indicators located above the current market price.
The Labour Department stated that the US consumer prices slowed growth to 1.7% year-on-year in November, held down by a strong decrease in apparel prices and weak costs of healthcare, which is likely to determine the pace at which the Fed hikes rates next year. Later, the Federal Reserve announced its decision to raise rates to 1.50% from 1.25%, as widely anticipated, but kept future projections unchanged, despite a possible short-term jump amid Trump's proposed cuts of tax.
US Retail Sales
At 13:30 GMT the US Census Bureau will publish an update on the Retail Sales, which are expected to increase to 0.3% from 0.2%. The Dukascopy Research team will cover this event on webinar.
USD/JPY falls to 50% Fibo at 112.45
Due to interest rate hike by the Federal Reserve, the currency exchange rate got a downside momentum, which lasted until the pair reached the last combined support level formed by the weekly S1 and the 50% Fibonacci retracement level at 112.45. A successful recovery of the buck looks unlikely, as the rate will need to cross a combination of the weekly PP, the 200-hour SMA and another 50% retracement level near the 113.00 mark. In addition to that, the northern side is strengthened by the falling 55- and 100-hour SMAs. From the opposite direction, the pair, in contrast, faces no notable support levels up until the 112.10 mark. In support of this assumption, majority in pending orders in 100-pip range are set to sell.Hourly chart
Due to major plunge that happened yesterday as well as pressure from support-turned-resistance 55-day SMA the currency rate is likely to start moving in southern direction towards the bottom boundary of a junior ascending channel that together with the upper boundary of a dominant channel down has formed symmetrical triangle pattern.
Daily chart
The SWFX sentiment has slightly decreased, as 62% of open positions are short. Meanwhile, 52% of pending orders are to buy the US Dollar (-7%).
OANDA traders are bullish on the pair, with 50% of open positions being long (-5%). Saxo Bank clients are holding 50% short positions (+1%).