- SWFX market sentiment is 71% bullish
- Pending orders in the 100-pip range are 56% to SELL
- Consumer survey
On Tuesday morning the USD/JPY currency exchange rate continued to surge on Tuesday, as the pair reached above the 105.50 mark. Meanwhile, traders have to note that the currency exchange rate was located between two hourly SMAs, which both were showing influence.
The Greenback strengthened against its European counterpart, following the US core durable goods orders data released on Friday. The EUR/USD currency pair lost 17 pips, or 0.14%, to continue fluctuating in the 1.2336 area.
The Census Bureau reported that the country's core durable goods orders came in better than expected, posting 1.2% uptick in February and surpassing the forecast of a 0.5% surge.
One of the main reasons for this rebound was the increase in shipments of core capital goods. Moreover, non-defence capital goods orders recorded the biggest increase in five months. This surge indicates that business spending is set to continue.
CB Consumer Confidence
On Monday another unscheduled fundamental announcement dictated the strength of the US Dollar. Namely, the announcement that China and the US are set to first negotiate their trade agreements prior to any tariffs caused an increase in volatility.
However, there are some events scheduled for this week, which might cause medium fluctuations in the currency pairs and commodity prices that have the US Dollar as one of the financial instruments being exchanged.
The first notable event will be the release of the CB Consumer Confidence on Tuesday at 15:00 GMT. The data release will be covered by the Dukascopy research team on the bank's live webinar platform. Tune in ten minutes before the data is released to see the cover.
USD/JPY moves away from yearly low
After reaching a new 2017/2018 low of 104.67 late on Friday, the US Dollar picked up momentum and had therefore shot up to 105.80 by Tuesday morning.This rapid change in sentiment was due to investors re-gaining confidence in global markets and thus relocating their funds from safe-haven currencies, including the Japanese Yen.
The Greenback dashed through the 55– and 100-hour SMAs and the weekly PP during the previous session and, at the time of this analysis, was testing the 200-hour moving average. This line is located near the weekly R1 and the prevailing trend-line circa 106.00.
It is likely that bulls do not have sufficient strength to overcome this resistance after yesterday's surge, thus allowing for a minor decline today. A possible downside target is the 55-hour SMA at 105.00.
Hourly Chart
After the recent events and the breaking of the previously drawn massive scale channel down pattern a full review of the situation has been conducted.
As it turns out, if one uses a different reference point for the lower trend line of the channel down pattern, its support hasn't been reached yet. The modified channel's support line is more likely to be touched near the 104.00 mark.
Daily chart
SWFX traders are still on the long side, as 71% of open positions were bullish during the morning hours. However, trader set up orders remain bullish, as 52% of trader set up orders were to buy the US Dollar in favour to the Japanese Yen.
Meanwhile, the market sentiment of OANDA traders remains strongly bullish with 69% long positions. In addition, Saxo bank traders are 57% bullish in regards to this pair.
Spreads (avg, pip) / Trading volume / Volatility