29/06/2016

Technical Analysis

EUR/USD GBP/USD USD/JPY XAU/USD

“The market is pricing in a non-trivial probability of a Fed rate cut over the next couple of months. The Fed is really boxed in now, so the market doesn’t even begin to price in any real chance of hikes until mid-2017.”

- BMO Capital Markets (based on Bloomberg)

EUR/USD fluctuates around 1.1065 on Wednesday

Level Rationale

■ R3 1.1207/31 20 and 100-day SMAs

■ R2 1.1144 Weekly PP

■ R1 1.1097 200-day SMA

■ S1 1.0988 Lower BB

■ S2 1.0948 Monthly S1

■ S3 1.0859 Weekly S1

Pair’s Outlook The European currency surged from 1.1023 to 1.1062 on Tuesday

against the US Dollar, as the Euro is slowly recovering after the huge

drop it experienced on the results of the UK referendum on EU

membership. At the moment, the currency exchange rate is fluctuating

around the level of 1.1065, and it has already experienced volatility

between the ranged of 1.1050 to 1.1080 today. The rate is most likely

to struggle with the 200-day SMA at 1.1096.

Traders’ Sentiment SWFX traders have not changed their slightly bullish sentiment from

yesterday, as 52% of all open positions are still short. In the meantime,

short pending orders in the 100-pip range have increased from 56% to

66%.

Dukascopy Bank SA, Route de Pre-Bois 20, International Center Cointrin, Entrance H, 1215 Geneva 15, Switzerland tel: +41 (0) 22 799 4888, fax: +41 (0) 22 799 4880 research@dukascopy.com

Wednesday, June 29, 2016 07:30 GMT

Sentiment Today Yesterday 5 days ago Positions -4% -4% -6%

-32% -12% -6% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Sell Buy Sell

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Sell Sell

ADX (14) Neutral Neutral Neutral

CCI (14) Neutral Neutral Neutral

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Sell Buy Sell

SAR (0.02; 0.2) Sell Buy Buy

Aggregate ↘ ↗ →

GBP/USD attempts to surge again

Level Rationale

■ R3 1.4092 Monthly S2

■ R2 1.3981 Weekly PP

■ R1 1.3851 Monthly R3

■ S1 1.3304/1.3230 Bollinger band; June 24 low

■ S2 1.2942 Weekly S1

■ S3 1.2191 Weekly S2

Pair’s Outlook As was anticipated, the Sterling managed to rebound on Tuesday,

unable to fall below the post-Brexit’s low of 1.3230. Technically, the

Pound is likely to continue edging higher today, as the 1.3230 mark is

also reinforced by the lower Bollinger band. The Cable could keep

appreciating until the 1.40 major level is reached, as there are no

substantial resistances on the way to that area. Meanwhile, technical

indicators retain mixed signals, unable to confirm the scenario. As a

result, risks of the GBP/USD slumping back to 1.3320 or even lower

persist.

Traders’ Sentiment Bulls slightly retreated, as 57% of all open positions are now long

(previously 60%). At the same time, the number of purchase orders

increased from 54 to 57% over the day.

Dukascopy Bank SA, Route de Pre-Bois 20, International Center Cointrin, Entrance H, 1215 Geneva 15, Switzerland tel: +41 (0) 22 799 4888, fax: +41 (0) 22 799 4880 research@dukascopy.com

Wednesday, June 29, 2016 07:30 GMT

“The pound has enjoyed a welcome relief rally, as sentiment starts to stabilise in the wake of last week’s surprise UK referendum vote outcome.” - CMC Markets (based on WBP Online)

Sentiment Today Yesterday 5 days ago Positions 14% 20% 12%

14% 8% -4% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Sell Sell Sell

RSI (14) Buy Neutral Neutral

Stochastic (5; 3; 3) Neutral Sell Sell

ADX (14) Neutral Sell Neutral

CCI (14) Buy Sell Buy

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Sell Neutral Sell

SAR (0.02; 0.2) Sell Buy Buy

Aggregate → ↘ →

USD/JPY struggles to post more gains

Level Rationale

■ R3 106.34/65 Weekly R1; 38.20% Fibo

■ R2 105.33 20-day SMA

■ R1 103.34 Monthly S2

■ S1 102.69 Weekly PP

■ S2 101.87/14 Trend-line; Bollinger band; monthly S3

■ S3 100.72 50.0% Fibo

Pair’s Outlook The Greenback’s bullish development against the Japanese Yen on

Tuesday caused the broadening falling wedge pattern to be preserved.

Even though the bearish momentum could prevail today, there is a

number of supports located below the 102.00 major level, which are

likely to prevent the Buck from sustaining sharper losses. One of those

supports is a five-month trend-line, which should ideally be the lowest

border to contain the volatility. Technical indicators also suggest the

USD/JPY pair is to weaken today, but strong fundamentals could be

sufficient to trigger a buying-spree, leading the exchange rate above

the 103.00 psychological level.

Traders’ Sentiment Bulls retreated over the day, with 66% of traders holding long positions

(previously 72%). The share of buy orders skyrocketed from 45 to 78%.

Dukascopy Bank SA, Route de Pre-Bois 20, International Center Cointrin, Entrance H, 1215 Geneva 15, Switzerland tel: +41 (0) 22 799 4888, fax: +41 (0) 22 799 4880 research@dukascopy.com

Wednesday, June 29, 2016 07:30 GMT

“The fallout from Brexit had held sway through yesterday's European and North American sessions, sending the pound even lower. But for now, the market is experiencing a lull in absence of fresh factors and dollar/yen appears to be holding out well.” - Societe Generale (based on Reuters)

Sentiment Today Yesterday 5 days ago Positions 32% 44% 44%

56% -10% 10% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Sell Sell Sell

RSI (14) Buy Buy Neutral

Stochastic (5; 3; 3) Sell Sell Neutral

ADX (14) Sell Sell Sell

CCI (14) Neutral Buy Buy

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Sell Sell Sell

SAR (0.02; 0.2) Sell Sell Sell

Aggregate ↘ ↘ ↘

Gold surges on Wednesday

Level Rationale

■ R3 1,365.71 Weekly R1

■ R2 1,343.10 Monthly R2

■ R1 1,338.97 Upper BB

■ S1 1,307.95 Weekly PP

■ S2 1,281/78 Monthly R1; 20-day SMA

■ S3 1,260/1,257 55-day SMA; weekly S1

Pair’s Outlook Although, the market recovered on Tuesday from the Brexit induced

shock last week, markets have returned to risk off sentiment on

Wednesday, as, in the meantime, the yellow metal met the weekly

pivot point at 1,307.95 and began to increase. The bullion started

Wednesday’s session at 1,310.24, and it has moved to 1,319.42 by 5:30

GMT. If the metal continues its northwards movement, it is bound to

meet the monthly R2 at 1,343.10. In addition, daily aggregate technical

indicators forecast a surge for the metal today.

Traders’ Sentiment SWFX traders have decreased their bearish sentiment, as 53% of open

positions are short on Wednesday. In the meantime, pending orders in

the 100-pip range are 70% long.

Dukascopy Bank SA, Route de Pre-Bois 20, International Center Cointrin, Entrance H, 1215 Geneva 15, Switzerland tel: +41 (0) 22 799 4888, fax: +41 (0) 22 799 4880 research@dukascopy.com

Wednesday, June 29, 2016 07:30 GMT

“While European equity prices have suffered the effects of investors’ uncertainty over the future of the EU, gold prices and other financial safe havens have benefited – and should continue – to benefit from it.” -Clif Droke (based on investing.com)

Sentiment Today Yesterday 5 days ago Positions -6% -8% -14%

40% 38% 46% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Buy Buy Buy

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Sell Sell Sell

ADX (14) Buy Neutral Neutral

CCI (14) Neutral Neutral Sell

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Buy Buy Buy

SAR (0.02; 0.2) Buy Buy Buy

Aggregate ↗ ↗ ↗

Signals Buy – the pair shows a clear uptrend Sell – the pair shows a clear downtrend Neutral – no specific trend for the pair Chart SMA (55) – Simple Moving Average of 55 periods SMA (200) – Simple Moving Average of 200 periods Indicators MACD – Moving average convergence divergence – momentum indicator RSI – Relative strength index – compares the magnitude of recent gains to recent losses in attempt to determine ‘overbought’ and ‘oversold’ conditions of the asset Stochastic – technical momentum indicator that compares a currency pair’s closing price to its price range over a given time period ADX – Average directional index – trend strength indicators CCI – oscillator used in technical analysis to help determine when a currency has been overbought or oversold SAR – trending indicator – shows the direction of a trend AROON – measures strength of a trend and likelihood that it will continue Alligator – trending indicator demonstrates presence of a trend and its direction Forecasts

Third Quartile – separates 25% of the highest forecasts

Second Quartile – the median price based on the

projections of the industry

First Quartile – separates 25% of the lowest forecasts

EXPLANATIONS

Dukascopy Bank SA, Route de Pre-Bois 20, International Center Cointrin, Entrance H, 1215 Geneva 15, Switzerland tel: +41 (0) 22 799 4888, fax: +41 (0) 22 799 4880 research@dukascopy.com

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