03/06/2016

Technical Analysis

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

“Perhaps the market is fearful that Draghi will not be able to suppress the euro while delivering a modestly upbeat message.” - ING Groep NV (based on Bloomberg)

EUR/USD suffers losses on ECB press conference

Level Rationale

■ R3 1.1331 Weekly R3

■ R2 1.1281/96 Monthly PP; weekly R2; 55-day SMA

■ R1 1.1155/1.1217 Weekly PP; 100-day SMA; weekly R1; 20-day SMA

■ S1 1.1094 200-day SMA

■ S2 1.1067 Weekly S1

■ S3 1.1024/23 Bollinger band; weekly S2

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions -6% -12% 2% -4%

Orders (±50 pips) 12% -4% -16% -9%

Orders (±100 pips) 8% -4% -10% -8%

Indicator Day Week Month

MACD (12; 26; 9) Sell Buy Buy

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Buy Neutral

ADX (14) Neutral Neutral Buy

CCI (14) Neutral Neutral Neutral

AROON (14) Sell Buy Buy

Alligator (13; 8; 5) Sell Buy Sell

SAR (0.02; 0.2) Sell Sell Sell

Aggregate ↘ ↗ →

Pair’s Outlook On Wednesday the Euro had a very positive outlook against the US

Dollar, as it was steadily gaining strength and climbed up to 1.1220.

However, just a couple of hours later the situation changed, as in

expectations and amidst the ECB rate announcement and the following

ECB’s press conference the exchange rate plummeted. At the moment

the pair is fluctuating around the level of 1.1155, where a cluster of

supports is located. Among them are the three SMA’s, the middle

Bollinger band and the weekly pivot point at exactly 1.1155.

Traders’ Sentiment At the moment traders are bearish on the pair, as 53% have opened

short positions. However, pending orders in 50 and 100-pip range show

56% and 55% orders, respectively, are bullish.

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Friday, June 03, 2016 07:30 GMT

GBP/USD about to test neckline

Level Rationale

■ R3 1.4602 Weekly PP

■ R2 1.4529/10 Monthly PP; 20-day SMA

■ R1 1.4465 Weekly S1

■ S1 1.4397 55-day SMA

■ S2 1.4365/33 Up-trend; May low; 100-day SMA

■ S3 1.4305/1.4288 Weekly S2; monthly S1; Bollinger band

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions 8% 6% -14% -5%

Orders (±50 pips) -18% -2% -30% -4%

Orders (±100 pips) -2% 2% -16% -4%

Indicator Day Week Month

MACD (12; 26; 9) Sell Buy Buy

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Buy Neutral Neutral

ADX (14) Neutral Neutral Sell

CCI (14) Buy Neutral Neutral

AROON (14) Buy Buy Sell

Alligator (13; 8; 5) Buy Neutral Sell

SAR (0.02; 0.2) Sell Sell Sell

Aggregate ↗ → ↘

Pair’s Outlook The Cable took a pause from a strong two-day decline yesterday,

stabilising just above the 55-day SMA. Nevertheless, there is still some

room for the sell-off to extend to the key support area at 1.4360/30,

where the currency pair is in turn expected to turn around and begin to

recover. However, if the price closes below 1.4360/30, this will mean

that GBP/USD broke the neckline of the double top pattern and that

the exchange rate will most likely descend down to the April’s lows at

1.4150.

Traders’ Sentiment Despite Sterling’s proximity to a major resistance area between 1.4750

and 1.48 dollars, the market is undecided with respect to the currency’s

future: 54% of traders are long and 46% are short. The same is with the

orders, 49% of which are buy and 51% are sell.

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

Friday, June 03, 2016 07:30 GMT

“The polls seem towards the 'Remain' outcome - as does our hope and forecasts - so we believe something of that is priced in.” - NORD/LB (based on Reuters)

USD/JPY no major obstacles until 107 yen

Level Rationale

■ R3 110.50 Up-trend

■ R2 109.96/82 Weekly PP; 55-day SMA; up-trend

■ R1 109.53/24 Weekly S1; monthly PP; 20-day SMA

■ S1 108.63 Weekly S2

■ S2 108.15/107.98 Weekly S3; Bollinger band

■ S3 107.04/106.65 Monthly S1; 38.2% Fibo

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions 50% 48% 40% 46%

Orders (±50 pips) 6% -14% -2% -8%

Orders (±100 pips) 26% 12% -4% 14%

Indicator Day Week Month

MACD (12; 26; 9) Buy Buy Sell

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Neutral Buy

ADX (14) Sell Neutral Sell

CCI (14) Buy Neutral Buy

AROON (14) Buy Sell Sell

Alligator (13; 8; 5) Buy Sell Buy

SAR (0.02; 0.2) Sell Sell Sell

Aggregate ↗ ↘ →

Pair’s Outlook USD/JPY decided not to pull back after breaking out of the channel and

prolonged the decline down to the weekly S2 level. If there is a rally

today, as suggested by the daily technical indicators, it is likely to stay

limited by the monthly PP and weekly S1 at 109.50/20. The current

target is a critical support area between 107 and 106.65 yen, which is

formed by the monthly S1, but even more importantly—by the 38.2%

retracement of the four-year up-move started back in 2012.

Accordingly, the risks are to the upside.

Traders’ Sentiment As many as three quarters of the SWFX market participants are

planning to profit from a stronger Dollar. And even though the currency

may thus seem overbought, 63% of orders placed next to the spot price

are to purchase the Greenback against the Japanese Yen.

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

Friday, June 03, 2016 07:30 GMT

“There’s now less chance of more Japanese monetary policy particularly when Abe said he’s thinking about doing more fiscal initiatives.” - Patersons Securities (based on Bloomberg)

Gold eroded two-day gains on Thursday

Level Rationale

■ R3 1,243.25/55 Weekly R1; 55-day SMA

■ R2 1,233.09/1,239.17 20-day SMA; monthly PP

■ R1 1,222.07/1,224.96 100-day SMA; weekly PP

■ S1 1,207.87 March low

■ S2 1,193.94 Weekly S1

■ S3 1,185.19/1,181.14 Bollinger band; 2013-2015 downtrend

Sentiment Today Yesterday 5 days ago 10-day avg. Positions 2% 10% -4% -3%

Indicator Day Week Month

MACD (12; 26; 9) Sell Sell Buy

RSI (14) Buy Neutral Neutral

Stochastic (5; 3; 3) Neutral Buy Neutral

ADX (14) Neutral Sell Buy

CCI (14) Neutral Buy Neutral

AROON (14) Sell Sell Buy

Alligator (13; 8; 5) Sell Buy Sell

SAR (0.02; 0.2) Sell Sell Buy

Aggregate ↘ → ↗

Pair’s Outlook The bullion went up at the start of Thursday and provided a good

perspective for bulls. However, after reaching the levels around 1,217 it

erased all daily gains almost in an hour. The losses were extended

through Friday and the metal fell to 1,206.87, where it touched the first

daily support, which is located exactly at that point. At the moment

gold is rebounding and has passed the daily pivot point at 1,212.25.

Above it are located the 55-hour SMA at 1,213.35 and daily R1 at

1,214.94.

Traders’ Sentiment SWFX traders are marginally bullish on gold on June 3, as 51% of them

have opened long positions, a decline of four percentage points from

yesterday’s 55%.

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

Friday, June 03, 2016 07:30 GMT

“You're kind of range bound until you're clear on what the trend is of the Fed and of the dollar.” - U.S. Bank Wealth Management (based on CNBC)

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

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