New York Forex Report: Markets muted without any tier one data catalysts, likely range trading persists as we head into the weekend. Notable loser on the session is Cable dented by data disappointments. USD trading around unchanged territory after rebounding yesterday, lifted by renewed weakness in market risk sentiment that bolstered refuge demand. The USD Index mounted a sustained recovery after a plunge in early European session to close 0.05% higher at 94.48. This morning risk sentiment has stabilised with the USD trading around 94.50
EUR/USD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bearish
Fundamental: Euro traded within a 40pip range (1.1350-1.1390) although slightly softer from a slightly firmer Dollar. With a sparsely populated data diary ahead for the day current ranges likely to contain trade ahead of the weekend.
Technical: Price continues to recoil and rotate below symmetry swing objective at 1.1420, printing a hight of 1.1438 before pulling back below the figure, price action appears to be coiling. While 1,1330 continues to support expect a test of offers towards 1.15 next.
Interbank Flows: Bids 1.1330 stops below. Offers 1.1450 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines
GBP/USD
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: GBP UK IP and manufacturing production disappointments. Another poor month for industrial production in February means the sectors output will have to rise 3.1% on the month in March for Q1 not to post a decline on Q4 of 2015. Data dents the cable recovery attempt as we trade back towards 1.4050.
Technical: Price is rotating around 1.4050 pivotal support within the broader 1.45/1.40 range. A failure to hold 1.40 opens a retest of year to date lows at 1.38 ahead of 1.37 weekly swing objective
Interbank Flows: Bids 1.40 stops below. Offers 1.45 stops above.
Retail Sentiment: Bullish
Trading Take-away: Short
USD/JPY
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: JPY has now appreciated every day this month and is close to 4% stronger in that time. If we go back to the moments since the BoJ cut rates into negative territory in January, the Yen is nearly 11% stronger in that time. The pair edged higher overnight on the back of rhetoric from 3 MoF officials.
Technical: The downside ratchet now targets 105.50 as the next major downside objective. Near term look for upside reaction to fail 110.50 resistance for renewed weakness.
Interbank Flows: Bids 107.50 offers below. Offers 110.50 stops above
Retail Sentiment: Bullish
Trading Take-away: Short
EUR/JPY
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: Japan’s current account surplus widened to 2434.9bn in Feb (Jan: 520.8bn) due to positive trade balance and the increase in investment income. Surplus hit the highest level seen in 11 months, spurred by the 5.4% MoM climb in exports coupled with a 9.5% MoM decline in imports, pushing trade surplus to 584.6bn (Jan: – 637.7bn).
Technical: Bears target a retest of 122 year to date lows, intraday resistance is sited at 124.50. Only a close over 126.80 eases immediate downside pressure.
Interbank Flows: Bids 122 stops below. Offers 124.50 stops above
Retail Sentiment: Bullish
Trading Take-away: Short
AUD/USD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bullish
Fundamental: Muted interest in the Antipodeans today, Aussie on a 0.75 handle after comments from RBA’s Edwards overnight. The 0.7500 level will be decent support in the short-term can’t see a big move in either direction ahead of the weekend..
Technical: Only a close below .7500 threatens the near term bullish bias, while this level supports intraday expect a grind higher to test .7770. A failure at .7550 opens pivotal .7450 support.
Interbank Flows: Bids .7500 stops below. Offers .7650 stops above
Retail Sentiment: Neutral
Trading Take-away: Neutral
USD/CAD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bearish
Fundamental: The future of CAD will be dictated by Canadian unemployment change (market expects 10K (-2.3) with rate unchanged at 7.3%).
Technical: The major hurdle to the upside remains the symmetry swing resistance sited at 1.3230, while this area continues to contain upside reactions anticipate a retest of 1.2830/50 level as we once again attempt to set a double bottom base to encourage a broader correction
Interbank Flows: Bids 1.30 stops below. Offers 1.3250 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines
