New York Forex Report: Markets managed to hold on to tentative gains over the European session as Crude Oil sustains its recovery, though still capped by the $27.90 area January lows. Heading into the US crossover traders await key US data: January Retail Sales expected to show a slight improvement and University of Michigan Confidence survey (FEB) expected to show an improvement also.
EUR/USD
Outlook: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks): Bearish
Fundamental: EUR softened over the early European session driven by improved risk appetite. EZ GDP oriented in line with expectations and traders now await key US data later today.
Technical: While 1.1150/30 remains intact as support expect rotation through last weeks highs en route to test 1.14 symmetry objective. Below 1.1050 eases immediate upside pressure
Interbank Flows: Bids 1.12 stops below. Offers 1.1350 stops above
Retail Sentiment: Bearish
Trading Take-away: Long
GBP/USD
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: A recovery in risk appetite drove Sterling higher over the European morning as traders shrug off recent data weakness.
Technical: Failure at 1.4350 suggests false upside break and resets bearish trend to attack and break 1.40 as the primary downside objective. Over 1.46 re- establishes bullish bias and targets retest of last weeks highs en route to 1.4860
Interbank Flows: Bids 1.4450 stops below. Offers 1.46 stops above
Retail Sentiment: Neutral
Trading Take-away: Neutral
USD/JPY
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: USD/JPY remained firm over early European trading as Japanese official comment, threatening action if moves continue, stemmed the surging Yen.
Technical: USD/JPY confirms break of major neckline support again overnight. While 114.10/20 caps intraday upside reactions expects a grind lower to test psychological 110 as the next downside objective.
Interbank Flows: Bids 112 offers below. Offers 114 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: Recent risk-averse market sentiment has seen EUR/JPY heavily under pressure but yesterday’s heavy JPY selling has stemmed the flow for now extended by a recovery in risk appetite across the European morning.
Technical: While 128.30 caps upside reactions expect a retest of year to date lows, ahead of a test of stops sub 126 only over 130.50 eases immediate downside pressure.
Interbank Flows: Bids 126 stops below. Offers 128.50 stops above.
Retail Sentiment: Bullish
Trading Take-away: Short
AUD/USD
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bearish
Fundamental: Choppy flows continue in AUD with the neurotic reversals in risk-sentiment and weak USD stifling any directional moves. US data later today will be key driver for AUD/USD short term.
Technical: AUD tests and hold bids ahead of.6950 a failure of support here opens a retest of year to date lows. Only a close over .7150 eases immediate downside pressure..
Interbank Flows: Bids .6950 stops below. Offers .72 stops above.
Retail Sentiment: Neutral
Trading Take-away: Neutral
USD/CAD
Outlook: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks): Bearish
Fundamental: A recovery in Oil over the European morning has USD/CAD trading weaker as the European session commences. USD strength is keeping directional moves contained however and likely to remain that way until key US data later today.
Technical: Anticipated 1.40 retest from below under way, while this area contains the upside reaction potential for bearish bias to resume, however while 1.38 supports there remains potential fro a broader corrective phase with 1.4160 the next upside pivot.
Interbank Flows: Bids 1.3750 stops below. Offers 1.40 stops above
Retail Sentiment: Neutral
Trading Take-away: Neutral
