USD/JPY Holds above 100.00 looking to go to 103.00

Technical Analysis

EUR/USD

EUR/USD struggles with the 23.6% Fibo
“The euro was for many years before seen as a more expensive currency, but now it’s not so obvious given the prospects of tapering. Draghi promises more accommodation if necessary for years to come.”
- UralSib Financial Corp. (based on Bloomberg)

• Pair’s Outlook
  It seems that bullish momentum from the bounce form the 50% Fibo (July to August move) has worn off as at the moment the pair is struggling with the 23.6% retracement. For the time being 20 and 55-day SMAs with the help of weekly R1 were able to keep the pair supported, but it might be that bearishness given by the short term technicals will take upper hand. It becomes even more likely when we remember that 61.8% retracement awaits testing.
• Traders’ Sentiment
  Situation in the market remains largely unchanged as greenback remains second most bought (in 60% of cases) currency across the board. Bears hold majority (60%) of all open positions. It is a marginal increase since yesterday. Distribution of pending orders is exactly the same—51% against 49% with the bears holding marginal upper hand.

GBP/USD

GBP/USD aims at 6 month high
"The kind of growth we want won't simply emerge of its own volition. In fact, I see a number of dangers. One is complacency, generated by a few quarters of good economic data. There are risks, not least the housing market getting out of control. Recovery will not be meaningful until we see strong and sustained business investment."
- Britain's Business Secretary Vince Cable (based on Reuters)

• Pair’s Outlook
  Pair struggles with the 1.575 resistance area where we have 6 month and recent (relative) high. Probability of a failure here is rather high. In case the pair manages to consolidate above it, 1.588 would be a good interim target, 1.580 might have some psychological effects as well. Closure below 1.570 could easily pave the way to slip to 1.560.
• Traders’ Sentiment
  Pound remains the most sold major currency across the board. There is no surprise that bears hold overwhelming majority (73%) of open positions. They are strengthening their positions in the distribution of pending orders as well. They have posted 55% of them, that is 2% more than yesterday.

USD/JPY

USD/JPY breaches 100 JPY
“Investors are taking on more risk amid a global stock rally as concern recedes over military intervention. That’s pushing the yen downward, which is raising expectations for higher earnings at Japanese exporters.”
- SMBC Nikko Securities Inc. (based on Bloomberg)

• Pair’s Outlook
  After the prolonged struggle with the 100 JPY, pair managed to breach it. This uplifted significant portion of the downside pressure and put 101.4 as an interim target. If the pair manages to advance above it in a timely fashion, we could easily expect it to test 103 JPY in the short term as well. In case of a failure at the 2 month high, we could expect it to slip to 100 JPY. Failure here would put 99 JPY on the map.
• Traders’ Sentiment
  Bears are keeping the pressure on the bulls, who have lost additional 4% of the market and at the moment account for 58% or market participants. Majority of pending orders, however, remains in favour of the bulls suggesting they are not willing to give up that easy.

USD/CHF

USD/CHF slips below the 200-day SMA
"Although Syria tensions continue to linger in the background, risk assets performed well overnight, helped in part by Chinese trade and inflation data released over the weekend."
- Credit Agricole (based on The Economic Times)

• Pair’s Outlook
  It seems that the pair’s bullishness after the failure at the 50% Fibo (July-August move), has ended as at the moment the pair is testing 100 and 200-day SMA.s Failure here could provoke a sell off till 0.915 with in between here and then support being at 0.924. Closure above the 100 and 200-day SMAs would put 0.945 on the map once again, but it is too soon to speak if the pair would manage to breach it with ease.
• Traders’ Sentiment
  Distribution of open positions is exactly the same as yesterday-bulls hold 72% of them. Noticeable changed took place in the distribution of pending orders. Share of the ones posted by the bulls increased by 6% and at the moment is at 63% gauge.