- The share of purchase orders slid from 65 to 47%
- 65% of traders hold long positions
- The 50% Fibo and the monthly S1 form resistance around 100.80
- The closest support rests around 99.85
- Upcoming events: US Final GDP, US Jobless Claims, US Goods Trade Balance, US Pending Home Sales, Fed Chair Yellen Speech, Japanese Household Spending, Tokyo Core CPI
New orders for US manufactured core durable goods dropped less than expected last month, official figures revealed on Wednesday. According to the US Department of Commerce, total new orders for durable goods were unchanged on a monthly basis in August, following the preceding month's downwardly revised gain of 3.6%, whereas market analysts expected new orders to drop 1.0% in the eight month of the year. August's flat reading was mainly driven by a 21.9% drop in demand for civilian aircraft. Excluding goods like motor vehicles and machinery, durable goods orders declined 0.4% in August, while economic desks penciled in a fall of 0.5%. The previous month's rise in core new orders was revised down to 1.3% from the originally reported 1.5%.
Other data released by the Energy Information Administration on Wednesday showed crude oil inventories in the United States fell 1.9 million barrels in the week ended September 23, whereas analysts anticipated a rise of 2.4 million barrels after the preceding week's 6.2 million-barrel drop. After the release, WTI crude rose 1.1% to trade at $45.18 per barrel, whereas Brent crude advanced 1.5% to trade at $46.66 on the NYSE.
US Final GDP, Initial Jobless Claims, Goods Trade Balance and Yellen's Speech
On Thursday most attention is to be paid to the US fundamental data, such as the Final GDP, the Initial Jobless Claims and the Goods Trade Balance. The most important one is the Final GDP, as it shows the monetary value of all the goods, services and structures produced within a country in a given period of time. It is a gross measure of market activity, because it indicates the pace at which a country's economy is growing or decreasing. As for the Jobless Claims, they are a measure of the number of people filing first-time claims for state unemployment insurance. In other words, it provides a measure of strength in the labor market. A larger than expected number indicates weakness in this market, which influences the strength and direction of the US economy. The Goods Trade Balance shows the difference between imported and exported goods. This data provides early insight into the Trade Balance, as it takes up a rather large part of it. Another event to pay attention to is Fed Yellen's Speech later today. Her words could turn the tide of the performances of USD-pairs. Furthermore, a number of Japanese data are due early tomorrow, which are likely to set the mood for the Friday's Asian session. One of the most important events will be the Tokyo Core CPI, which is a measure of price movements obtained by comparison of the retail prices of a representative shopping basket of goods and services, excluding fresh food. The index captures inflation in Tokyo and the purchase power of JPY is dragged down by inflation. Another event will be the Overall Household Spending. It is an indicator that measure the total expenditures by households. The level of spending can be used as an indicator of consumer optimism. It is also considered as a measure of economic growth.USD/JPY surged after Kuroda's speech
Wednesday ended with the US Dollar adding as little as 25 pips against the Japanese Yen, therefore, unable to climb over the immediate resistance. Earlier today BoJ Kuroda's speech triggered JPY-selling, which is a good sign, as a bullish USD/JPY development would eventually lead to another retest of the descending channel's resistance line. However, taking into account recent similar developments, the pair could still erased all intraday gains and end the day with another bearish outcome. Technical indicators keep giving bearish signals, thus, this possibility should not be ignored, where the 100.00 mark is the main target.Daily chart
The weakening of the Yen keeps pushing the given pair higher, namely towards the 102.00 level, where the bearish trend-line is located at. The USD/JPY pair is expected to bounce back from this area, impetus for which might be provided by the US GDP figures or Yellen's speech later today. Ultimately, the bearish trend is likely to remain intact.
Hourly chart
There are now 65% of traders holding long positions (previously 64%), whereas the share of purchase orders slid from 65 to 47%.
Meanwhile, there has been a decrease in the number of long positions at other brokers. Right now 70% of OANDA clients are bulls, down from 72% recorded on Wednesday. Saxo Bank clients, however, became less bullish than on Wednesday, being that the portion of longs now takes up 67% of the market.
Spreads (avg, pip) / Trading volume / Volatility
Traders are becoming increasingly bullish the Dollar
According to the poll that gathered forecasts between August 29 and September 29, traders expect the US Dollar to appreciate to 106.07 yen in three months' time, while the forecast for November 30 was only 103.30 yen. It is also worth noticing that 82% of all forecasts fall above 102 yen, which is the current spot price. By far the most popular interval is 109.50-111.00, chosen by 24% of all the surveyed, compared to popularity of the 105.00-106.50, 106.50-108.00 and 108.00-109.50 intervals.