01/09/2016

Technical Analysis

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

EUR/USD almost flat at 1.1150 on Thursday morning

Level Rationale

■ R3 1.1307 Weekly R1

■ R2 1.1244 Weekly PP

■ R1 1.1190/1.1214 Monthly PP; 20 and 100-day SMAs

■ S1 1.1147/07 Weekly S1; 55 and 200-day SMAs

■ S2 1.1069 Weekly S2

■ S3 1.1035/13 Bollinger band; monthly S1

Pair’s Outlook The common European currency moved slightly lower on Thursday

morning against the US Dollar, as the currency exchange rate still does

not manage to find enough support in the cluster below it to rebound.

Previously, on Wednesday the currency pair started the day’s trading

session in the middle of the cluster and fluctuated amidst it until it

ended the session at 1.1157, which is just above the 55-day SMA. Due

to the combined strength of the support cluster, it is clear that the rate

will most likely rebound against it and move to the newly formed

monthly pivot point at 1.1190.

Traders’ Sentiment SWFX trader sentiment remains unchanged on Thursday, as 59% of

open positions are short. In the meantime, pending commands are 54%

to sell the pair.

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

Thursday, September 01, 2016 07:30 GMT

"Europe has seen a rise in nationalism and populism that we think could draw into question the whole euro zone project." - Michael Hasenstab, Franklin Templeton, (based on Reuters)

Sentiment Today Yesterday 5 days ago Positions -18% -18% -22%

-8% -12% -6% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Buy Buy Sell

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Sell Sell

ADX (14) Neutral Neutral Neutral

CCI (14) Buy Neutral Neutral

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Neutral Buy Sell

SAR (0.02; 0.2) Sell Sell Buy

Aggregate ↗ → →

GBP/USD poised for more gains

Level Rationale

■ R3 1.3385/96 Monthly R1; weekly R2

■ R2 1.3263/1.3322 Bollinger band; weekly R1; 55-day SMA; 23.60% Fibo

■ R1 1.3152 Weekly PP

■ S1 1.3126/1.3080 Monthly PP; 20-day SMA

■ S2 1.3025 Weekly S1

■ S3 1.2908/1.2880 Weekly S2; Bollinger band; monthly S1

Pair’s Outlook The British currency managed to outperform the Greenback on

Wednesday, not only retaking the 1.31 level, but also negating

Monday’s and Tuesday’s losses. Gains were limited by the immediate

resistance, which could cause the Pound to retreat today. However,

technical indicators suggest otherwise, as they retain bullish signals. In

case the bullish momentum prevails, the pair could reclaim the 1.32

level. The second closest resistance area is likely to remain out of reach,

as there no impetus today is expected to push the Cable beyond

1.3250.

Traders’ Sentiment There are 52% of traders with a negative outlook towards the Sterling,

unchanged since yesterday. The share of buy and sell orders barely

changed, as they take up 51% and 49% of the market, respectively.

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

Thursday, September 01, 2016 07:30 GMT

“We remain broadly bearish on the GBP, anticipating further BOE easing in the months ahead and anticipating that direct investment and portfolio flows will be insufficient to easily fund the UK current account deficit in the near term.” - BNP Paribas (based on PoundSterlingLive)

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

2% 4% -4% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Buy Sell Sell

RSI (14) Neutral Buy Buy

Stochastic (5; 3; 3) Neutral Sell Neutral

ADX (14) Neutral Sell Neutral

CCI (14) Neutral Neutral Buy

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Neutral Sell Sell

SAR (0.02; 0.2) Buy Sell Sell

Aggregate ↗ ↘ →

USD/JPY puts the down-trend to the test

Level Rationale

■ R3 105.44 100-day SMA

■ R2 104.55/79 Weekly R3; monthly R1

■ R1 103.44/51 Down-trend; Bollinger band

■ S1 103.25/102.84 55-day SMA; weekly R2

■ S2 102.55/16 Weekly R1; monthly PP

■ S3 101.39/24 20-day SMA; weekly PP

Pair’s Outlook The USD/JPY currency pair posted more gains on Wednesday, but they

were limited by the eight-month resistance line at 103.55.

Consequently, the American Dollar is now likely to undergo a

correction, which could cause the given pair to slide back under the

103.00 major level, at least from the technical point of view. Aggregate

technical studies, on the other hand, are unable to confirm the

possibility of the negative outlook, as they keep giving mixed signals.

Furthermore, there is a relatively large number of supports under the

103.00 mark, all having the potential to cause a bullish outburst if some

demand is sufficient.

Traders’ Sentiment Bulls retreated again, as 65% of traders hold long positions today

(previously 66%). The buy and the sell order ratio is now equal to one.

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

Thursday, September 01, 2016 07:30 GMT

“The dollar and Treasury yields had risen in tandem following Jackson Hole last week but that phase came to an end yesterday. The US dollar will not be making much further headway before Friday's non-farm employment report.” - Barclays (based on The Business Times)

Sentiment Today Yesterday 5 days ago Positions 30% 32% 34%

0% 34% 26% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Buy Sell Sell

RSI (14) Neutral Neutral Buy

Stochastic (5; 3; 3) Sell Neutral Neutral

ADX (14) Neutral Sell Sell

CCI (14) Sell Neutral Buy

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Neutral Sell Sell

SAR (0.02; 0.2) Buy Sell Sell

Aggregate → ↘ →

Gold trades below 1,310 on Thursday

Pair’s Outlook The yellow metal is located between two weekly support levels at

1,310.87 and 1,301.13 without clear direction on Thursday morning.

Previously, on Wednesday the metal fluctuated around the first weekly

support level at 1,310.87 and ended the day’s trading session at

1,307.70. On Thursday morning the bullion had slightly surged, as it

continued a rebound from the support cluster located below, which

occurred on Wednesday. However, the metal is most likely to bounce

off the weekly S1 at 1,310.87 and continue its downward movement in

accordance with the channel down pattern, in which it has been for the

past nine sessions.

Traders’ Sentiment Traders are neutral bearish on the metal, as 51% of open positions are

short. In the meantime, pending commands are 61% to buy.

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

Thursday, September 01, 2016 07:30 GMT

“Gold held last month’s decline as investors await U.S. jobs data due Friday for further clues on the timing of an interest rate increase.” – based on Bloomberg

Sentiment Today Yesterday 5 days ago Positions -2% -4% -8%

22% 4% 22% Orders

Indicator 1D 1W 1MN

MACD (12; 26; 9) Sell Buy Buy

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Sell Sell

ADX (14) Neutral Neutral Neutral

CCI (14) Buy Neutral Neutral

AROON (14) Buy Buy Buy

Alligator (13; 8; 5) Sell Buy Buy

SAR (0.02; 0.2) Sell Buy Buy

Aggregate → ↗ ↗

Level Rationale

■ R3 1,326/30 Monthly and weekly PPs; 20 and 55–day SMAs

■ R2 1,316.94 Trend line

■ R1 1,310.87 Weekly S1

■ S1 1.301/1,283 Bollinger band, trend line; weekly S2

■ S2 1,295.95 100-day SMA

■ S3 1,285/84 Monthly S1; weekly S3

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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