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EUR/CHF Temporary bounce.

EUR/CHF's is moving up and down. The medium-term pattern suggests us to see continued bearish pressures towards key support that can be found at 1.0623 (24/06/2016 low).

In the longer term, the technical structure is mixed. Resistance can be found at 1.1200 (04/02/2015 high). Yet,the ECB's QE programme is likely to cause persistent selling pressures on the euro, which should weigh on EUR/CHF. Supports can be found at 1.0184 (28/01/2015 low) and 1.0082 (27/01/2015 low).

EUR/JPY Pausing around 120.

EUR/JPY rejection at 122.88 has triggered a correction. The pair is also very volatile. Hourly support can be found at 119.33 (23/03/2017 low). Resistance stands at 122.88 (13/03/0217 high). Expected to show continued weakness.

In the longer term, the technical structure validates a medium-term succession of lower highs and lower lows. As a result, the resistance at 149.78 (08/12/2014 high) has likely marked the end of the rise that started in July 2012. Strong support at 94.12 (24/07/2012 low) looks nonetheless far away.

EUR/GBP Bullish breakout.

EUR/GBP's bullish flag turned out to be true. The pair is now heading towards resistance at 0.8787 (13/03/2017 high). Key resistance is given at 0.8854 (15/01/2017 high). Hourly support can be found at 0.8605 (23/03/2017 low. Expected to show continued weakness.

In the long-term, the pair has largely recovered from recent lows in 2015. The technical structure suggests a growing upside momentum. The pair is trading above from its 200 DMA. Strong resistance can be found at 0.9500 psychological level.

USD/CHF Bouncing back.

USD/CHF is surging. Hourly support is given at 0.9814 (27/03/2017 low). Key resistance can be found at a distance at 1.0344 (15/12/2016 high). Expected to show continued weakness.

In the long-term, the pair is still trading in range since 2011 despite some turmoil when the SNB unpegged the CHF. Key support can be found 0.8986 (30/01/2015 low). The technical structure favours nonetheless a long term bullish bias since the unpeg in January 2015.

USD/CAD Short-term strengthening.

USD/CAD is pushing higher. A break of resistance area around 1.3400 is needed to invalidate the current short term bearish technical structure. The road seems still wideopen for larger decline. Key support is given at 1.2969 (31/01/2017 low).

In the longer term, there is a golden cross with the 50 dma crossing the 200 dma indicating further upside pressures. Strong resistance is given at 1.4690 (22/01/2016 high). Long-term support can be found at 1.2461 (16/03/2015 low).

AUD/USD Bouncing.

AUD/USD keeps on correcting lower since the pair has failed to test the key resistance at 0.7778 (08/11/2016 high). Expected to see some shortterm weakness towards support area around 0.7500.

In the long-term, we are waiting for further signs that the current downtrend is ending. Key supports stand at 0.6009 (31/10/2008 low) . A break of the key resistance at 0.8295 (15/01/2015 high) is needed to invalidate our long-term bearish view.

EUR/USD Bouncing lower.

EUR/USD has failed to hold above former resistance given at 1.0874 (08/12/2017 high). Hourly support is given at 1.0719 (21/03/2017 low). Stronger support can be found at 1.0493 (22/02/2017 low). Expected to show renewed bullish pressures.

In the longer term, the death cross late October indicated a further bearish bias. The pair has broken key support given at 1.0458 (16/03/2015 low). Key resistance holds at 1.1714 (24/08/2015 high). Expected to head towards parity.

GBP/USD Bearish consolidation.

GBP/USD has exited short-term uptrend channel. We consider that there are still rooms for further strength. Hourly resistance is located at 1.2615 (27/03/2017 high). Hourly support is given at 1.2324 (03/17/2017 low). Expected to show continued strength towards resistance at 1.2771 (05/10/2016 high).

The long-term technical pattern is even more negative since the Brexit vote has paved the way for further decline. Long-term support given at 1.0520 (01/03/85) represents a decent target. Long-term resistance is given at 1.5018 (24/06/2015) and would indicate a long-term reversal in the negative trend. Yet, it is very unlikely at the moment.

USD/JPY Bearish pressures are fading.

USD/JPY's bearish pressures are fadingHourly resistance can be located at 113.57 (16/03/2017 high) while support is given at 110.11 (27/03/2017 low).

We favor a long-term bearish bias. Support is now given at 96.57 (10/08/2013 low). A gradual rise towards the major resistance at 135.15 (01/02/2002 high) seems absolutely unlikely. Expected to decline further support at 93.79 (13/06/2013 low).

'Consumers' assessment of current business and labor market conditions improved considerably.' - Lynn Franco, The Conference Board

The Conference Board Consumer Confidence Index increased significantly despite experts' pessimistic forecasts. In March, it gained 8% and reached 125.6, which is the highest value since December 2000. Therefore, the number of consumers who evaluated business conditions as 'good' rose from 28.3% to 32.2%. Moreover, the number of consumers who believed that there was 'enough' job offers in the market also climbed from 26.9% to 31.7%. Accordingly, the number people who evaluated business conditions as 'bad' decreased from 13.4% to 12.9%. In addition, the number of people who were experiencing 'difficulties' finding a job slightly diminished from 19.9% to 19.5%. Altogether, this mean that consumers believe that the current economic conditions have improved and that they are ready to increase their spending and investments. This also suggests that people are more optimistic about the near-term economic situation. For instance, the number of consumers who suggested that business conditions would improve even more in the next six months soared from 23.9% to 27.1%. At the same time, the number of consumers who suggested that more jobs would be created in the next six months also nudged from 20.9% to 24.8%.

'It's sensible to wonder whether the dollar's recent slide is a sign that post-election euphoria is fading, but by one measure a decline was overdue before Election Day.' – Nir Kaissar, Bloomberg

Pair's Outlook

On Wednesday morning the common European currency traded flat against the US Dollar near the 1.0810 mark, and it was positioned to decline to the 1.0780 level. At the 1.0780 level was located the closest support to the currency exchange rate, as there the weekly PP was located at. Previously, during Tuesday's session, the pair failed to break the resistance put up by the 200-day SMA near the 1.0875 level. As a result the decline of the pair began, as it passed the weekly R1 and 38.20% Fibo, respectively, at 1.0841 and 1.0826. These levels of significance have begun to provide resistance on Wednesday.

Traders' Sentiment

Traders have not changed their opinion, as 63% of open positions remain short. Meanwhile, 51% of set up orders are to sell the Euro.

'According to our long-term fair value model G10 VALFex, the USD already looks quite overvalued vs SEK, EUR, JPY and GBP and that should limit any future gains.' – Credit Agricole (based on PoundSterlingLive)

Pair's Outlook

In the wake of formal beginning of Brexit the GBP/USD pair began sliding down, this was seen by yesterday's bearish development when the Pound lost more than 100 pips. Despite being supported by the weekly PP, the 55 and the 100-day SMAs, the Cable is likely to edge lower again. The 1.23 major level is expected to be the bottom floor for today's trading, even though technical indicators are giving bullish signals in the daily timeframe. Ultimately, the given pair has been consolidating between 1.1950 and 1.27 since October 2016, and this trading range still remains intact, with the Sterling headed towards the lower half, namely below the 1.23 mark.

Traders' Sentiment

Although not as strong as yesterday, but market sentiment remains bullish, now at 57%. The share of sell orders increased from 53 to 55%.

'I think the optimism about 'Trumponomics,' against the failure to pass the Obamacare reform bill, is still dominating the dollar/yen market.' – Mizuho Securities (based on Reuters)

Pair's Outlook

After a two-week decline the USD/JPY currency pair managed to breach the descending channel's support line yesterday, also reacquiring the 111.00 mark. Nevertheless, the rally was stopped by the monthly S1, which could still cause bears to push the exchange rate lower today. Moreover, technical indicators remain in favour of the negative outcome and the Bollinger bands suggest a close in the red zone today is likely. The nearest support is the weekly S1 at 110.35, but a drop that low is doubtful, with the 110.60 level seen as the lowest intraday closing point.

Traders' Sentiment

Bullish traders' sentiment returned to its Monday's level of 72% (previously 71%). At the same time, the number of orders to acquire the Buck edged down from 66 to 63%.

'A resurgent U.S. dollar, along with higher U.S. yields and equities has taken the momentum out of the gold rally for now.' – Jeffrey Halley, OANDA (based on Reuters)

Pair's Outlook

After failing to score more gains on Tuesday the yellow metal declined, and the commodity price fell below the 1,250 mark, where it remained on Wednesday morning. Due to the fact that the bullion's price recently passed the support put up by the 50.00% Fibonacci retracement level, which is located at the 1,248.96 mark, the price is set to fall. The reason for that is the fact that the closest support level is located at the 1,240.87 level. At that level the weekly PP is residing. The pivot point is also supported by the lower trend line of a medium term ascending channel.

Traders' Sentiment

SWFX market sentiment remains neutral bearish, as 51% of open positions are short. Meanwhile, 64% of trader set up orders are to buy the yellow metal.

EUR/JPY - 119.93

Recent wave: wave v of (C) ended at 94.12 and major correction in wave A has ended at 149.79

Trend: Near term up

Original strategy:

Bought at 121.30, stopped at 120.80

Position: - Long at 121.30
Target: -
Stop: - 120.80

New strategy :

Stand aside

Position: -
Target:  -
Stop:-

Although the single currency edged higher again, lack of follow through buying and the subsequent retreat from 120.44 suggest further consolidation is in store, near term upside risk remains for the corrective bounce from 119.32 to extend gain to 120.60-70, however, as this move is viewed as retracement of recent decline, reckon upside would be limited to 121.15-20, bring retreat later. Only break of 121.84 resistance would revive bullishness and signal the fall from 122.89 has ended, bring further gain to 122.25-30 first.

On the downside, below 119.70 support would bring test of said support at 119.54 but break there is needed to signal the fall from 122.89 top has resumed and may extend weakness to 119.00, then 118.67 support but loss of momentum should prevent sharp fall below latter level and price should stay well above previous chart support at 118.25, risk from there is seen for a rebound later.

Our latest preferred count is that wave (ii) is ABC-X-ABC which ended at 123.33 and wave (iii) is unfolding with wave iii ended at 100.77, followed by wave iv at 111.57 and wave v as well as the wave (iii) has ended at 97.04, followed by wave (iv) at 111.43 and wave (v) has ended at 94.12 which is also the end of the larger degree v, this also implied the major wave (C) has also ended there, hence major correction has commenced from there with (A) leg unfolding in its lower degree wave c which has possibly ended at 145.69. Under this count, A-B-C wave (B) has commenced with A leg ended at 136.23, wave B at 143.79 and wave C has possibly ended at 149.79.

Our larger degree count is that the decline from 139.26 is wave (C) and is sub-divided into a diagonal triangle i-ii-iii-iv-v with wave i - 105.44, wave ii- 123.33, wave iii - 97.03, wave iv - 111.43, followed by the final wave v as well as the end of wave (C) at 94.12, this also mark the bottom of larger degree wave B. Under this count, major rise in wave C has commenced as an impulsive wave with minor wave III ended at 145.69, wave V is still in progress for further gain to 150.00. Having said that, this so-called wave V could well be the first leg of larger degree 5-waver wave C and this wave C should bring at least a retest of wave A top at 169.97 (July 2008).

PM Theresa May will finally today deliver a letter officially triggering article 50 and beginning at least two years of tough negotiations.

Speculation likely to continue as meaningful talks could take months to begin

There has been endless amounts of speculation over the last nine months about how the negotiations are going to proceed and what will and will not be discussed, something that is unfortunately likely to continue for a while yet. And while the triggering of article 50 officially begins two years of negotiations, we could actually be waiting months before any meaningful talks get underway.

GBPUSD off more than 1.5% in 24 hours as sterling shows continued sensitivity to Brexit

The pound has been very sensitive to this speculation since last June and we saw more evidence of this overnight after pictures emerged of May signing the letter invoking article 50 to be delivered to EU President Donald Tusk later today. Sterling had already gradually lost ground against the dollar throughout the session, having traded close to 1.26 in early European trade, but another bout of selling in illiquid trade took it below 1.24 shortly after the photos emerged.

Sterling to remain volatile as May appears before parliament around midday

The pound is likely to remain quite volatile throughout today's session, particularly around May's appearance at PMQs just after midday. May will appear in parliament to discuss the triggering of article 50 just as the letter is being delivered to Brussels and what she says today will likely play a big role in how the pound trades, with the FTSE and UK bonds also being sensitive to her comments. The FTSE has tended to benefit from the pounds fall, as we saw yesterday and are likely to see shortly after the open. Given the selling that we've seen over the last 24 hours, it is worth being prepared for a possible case of traders selling the news and buying the fact today. Of course, that will heavily depend on May's comments this afternoon.

Scottish referendum may also be addressed after Edinburgh voted in favour on Tuesday

May could also address the Scottish parliaments vote on Tuesday to hold a second referendum, which came just one day before the UK triggered its own departure from the EU. May has not been very receptive to the idea previously and I would expect more of the same talk today. While again expected, this was likely another contributor to the pounds decline yesterday and it could be sensitive to it again today.