01/06/2016

Technical Analysis

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

“The data front is holding the Fed back. The dollar’s going to give back some of its recent gains.” - BNP Paribas (based on Bloomberg)

EUR/USD bounces off 200-hour SMA

Level Rationale

■ R3 1.1226 20-day SMA

■ R2 1.1199 Weekly R1

■ R1 1.1155/77 Weekly PP; 100-day SMA

■ S1 1.1094 200-day SMA

■ S2 1.1067 Weekly S1

■ S3 1.1023/14 Weekly S2; Bollinger band

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions 0% -2% 0% -4%

Orders (±50 pips) 12% -12% -32% -11%

Orders (±100 pips) 0% -12% -16% -10%

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 EUR/USD continued its rally in the first half of Tuesday and reached the

200-hour SMA at 1.1170. However, the pair bounced off the moving

average midday and depreciated to 1.1130 at the end of the day, 20

pips lower than the 1.1150 level reached earlier the same day. With the

start of Wednesday the currency exchange rate continued moving

downwards and at the moment has reached the 1.1121 level. In the

meantime, aggregate technical indicators for today predict

depreciation of the Euro against the US Dollar.

Traders’ Sentiment Yesterday the portion of the bulls increased to 50% from 49% and

traders became unsure about the currencies’ further movement.

Alongside, pending orders in the 100-pip range from the current spot

price are evenly placed to either sell or buy EUR/USD.

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 01, 2016 07:30 GMT

GBP/USD at risk of forming double top

Level Rationale

■ R3 1.4725/13 Monthly R1; Bollinger band

■ R2 1.4602 Weekly PP

■ R1 1.4529/17 Monthly PP; 20-day SMA

■ S1 1.4465 Weekly S1

■ S2 1.4400 55-day SMA

■ S3 1.4340/1.4288 Weekly S2; monthly S1; 100-day SMA; up-trend; May low

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions -8% -6% -12% -9%

Orders (±50 pips) -38% 74% 10% 5%

Orders (±100 pips) -22% -2% 0% 2%

Indicator Day Week Month

MACD (12; 26; 9) Sell Buy Buy

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Neutral Neutral Neutral

ADX (14) Neutral Buy Sell

CCI (14) Neutral Sell Neutral

AROON (14) Buy Buy Sell

Alligator (13; 8; 5) Buy Neutral Sell

SAR (0.02; 0.2) Sell Buy Sell

Aggregate → ↗ ↘

Pair’s Outlook While trading within a rather poorly defined bullish channel (since late

February), the Cable appears to be forming a double top with peaks on

May 2 and May 25. Accordingly, if the price closes under the wide but

at the same time dense demand area between 1.4344 and 1.4288,

which consists of the neck-line, 100-day SMA and the lower bound of

the channel, the new target will be the April’s lows, namely 1.4050.

Meanwhile, even if the Sterling does rise from 1.4344/1.4288, the gains

are to be limited by the massive resistance circa 1.48 dollars.

Traders’ Sentiment There is still no consensus among SWFX traders with respect to the

British Pound, being that 46% of them are long the currency and 54%

are short. However, the sell orders exceed the buy ones: 61% versus

39%.

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 01, 2016 07:30 GMT

“The latest polls have hit sentiment and are driving down sterling.” - a spot trader in London (based on Reuters)

USD/JPY fails to reach 112 yen

Level Rationale

■ R3 111.91/90 Apr high; up-trend

■ R2 111.48/30 Weekly R2; Bollinger band

■ R1 110.82 Weekly R1

■ S1 110.00/109.93 Weekly PP; 55-day SMA; up-trend

■ S2 109.48/24 Weekly S1; monthly PP; 20-day SMA

■ S3 108.63 Weekly S2

Sentiment Today Yesterday 5 days ago 10-day avg. Open Positions 44% 44% 46% 45%

Orders (±50 pips) 30% -34% 12% -13%

Orders (±100 pips) -8% 28% 16% 3%

Indicator Day Week Month

MACD (12; 26; 9) Buy Buy Sell

RSI (14) Neutral Neutral Neutral

Stochastic (5; 3; 3) Sell Neutral Buy

ADX (14) Buy Neutral Sell

CCI (14) Neutral Neutral Buy

AROON (14) Buy Sell Sell

Alligator (13; 8; 5) Buy Sell Buy

SAR (0.02; 0.2) Buy Sell Sell

Aggregate ↗ ↘ →

Pair’s Outlook USD/JPY turned around before reaching the upper bound of the

channel, and the currency pair is now testing the up-trend and 55-day

SMA at 110 yen. The base scenario is that this support holds and

triggers a rally towards 112 yen, where the rate should meet the April

high, weekly R3 and 100-day SMA. If this is not the case and the price

falls lower, the sell-off will likely extend down to 107, where support is

implied by the monthly S1 and 38.2% Fibonacci retracement of the

2011-2015 up-move.

Traders’ Sentiment The number of bulls by far exceeds the number of bears: 72% of open

positions are long and only 28% are short. At the same time, the share

of orders set 100 pips around the spot to purchase the Greenback

declined from 64 to 46%.

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 01, 2016 07:30 GMT

The data “feeds into the idea of a Fed hike in the months ahead and into the concepts of an improving economy in Q2, all of which is important for the dollar.” - Commonwealth Foreign Exchange (based on MarketWatch)

Gold revives for the first time in ten days

Level Rationale

■ R3 1,238.58/1,239.17 20-day SMA; monthly PP

■ R2 1,224.96 Weekly PP

■ R1 1,219.57 100-day SMA

■ S1 1,207.87 March low

■ S2 1,193.94 Weekly S1

■ S3 1,186.79/1,186.25 Bollinger band; 2013-2015 downtrend

Sentiment Today Yesterday 5 days ago 10-day avg. Positions 8% 4% -6% -11%

Indicator Day Week Month

MACD (12; 26; 9) Sell Sell Buy

RSI (14) Buy Neutral Neutral

Stochastic (5; 3; 3) Neutral Neutral Neutral

ADX (14) Neutral Sell 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 Buy

Aggregate ↘ → ↗

Pair’s Outlook For the first time in ten days the bullion has finally gained value on

Tuesday of this week. The price rebounded only slightly, and after

touching the 100-day SMA at 1,218 gold was forced to make a setback

to close at 1,214. Nevertheless, the outlook remains largely negative

and the metal will feel bearish pressure as long as it keep fluctuating

under the 100-day SMA and the weekly pivot point of 1,224.96. A spike

above here would allow for another streak of gains in the direction of

the fresh June monthly pivot point at 1,239.17. From the downside, the

most important support is represented by the weekly S1 at 1,193.94.

Traders’ Sentiment More than 54% of all SWFX positions are bullish on the yellow metal in

the morning today, proclaiming an additional increase of about two

percentage points over the past 24 hours.

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 01, 2016 07:30 GMT

“The fact that gold did not undergo another sharp selling bout on Tuesday in light of strong U.S. macro data (and an equally strong dollar) tells us that participants may already have discounted a rate rise.” - INTL FCStone (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

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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