New York Forex Report: Pound Plunges On Soft CPI

New York Forex Report: Pound Plunges On Soft CPI

New York Forex Report: USD rotation continues ahead of the first major data of the week with USD CPI at 1330GMT1, expected to have picked up slightly in April. We also have real average weekly earnings as well as Industrial and Manufacturing Production with both Fed’s Williams and Kaplan speaking latr in the US session.

FX Majors: Key data over the European mroning was the release of UK April CPI which printed below expectations on both core and headline at 1.2% vs 1.4% and 0.3% vs 0.5% respectively. Elsewhere, ECB’s Praet warned that the EZ banking sector is in facing a looming profitability shocks due to high costs and excessive bad debt.

EURUSD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bullish

Technical: Prior support at 1.1350 now becomes resistance while this area contains upside reactions, expect a test of 1.1240 as interim support as bears now target symmetry support at 1.1065, only over 1.1450 eases immediate downside bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

GBPUSD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bullish

Technical: Bids ahead of 1.4316 primary symmetry support see GBP surge over night, the short squeeze now targets range resistance at 1.4530, only over 1.4550 eases immediate bearish bias
Retail Sentiment: Bearish
Trading Take-away: Long

USDJPY
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bearish

Technical: As 108.20 supports intraday expect a retest of offers at prior highs en route to symmetry swing resistance at 109.80 where trend selling should re-emerge, over 111 eases immediate bearish bias
Retail Sentiment: Neutral
Trading Take-away: Neutral

EURJPY
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bearish

Technical: Bears now target weekly symmetry objective at 120.60. Intraday resistance at 124.65 only a close above 126.80 eases immediate downside pressure.
Retail Sentiment: Bearish
Trading Take-away: Long

Commodities FX: Oil continues its march north fuelled by continued production outages and disruptions. Wildfires continue to plague the Fort McMurray region of Canada leading to a temporary shutting down of operations for various Oil groups operating in the region.

AUDUSD
Outlook: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks): Bullish

Technical: .7240 level survives on a closing basis AUD and the anticipated window to correct the recent pull back to test symmetry resistance sited at .7580 is in play. Intraday resistance is sited at .7400
Retail Sentiment: Bullish
Trading Take-away: Sidelines

USDCAD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bearish

Technical: 1.30 upside objective achieved expected a correction to retest 1.2740/60 is underway, this level should now act as support for further upside corrective action.
Retail Sentiment: Bullish
Trading Take-away: Sidelines

XAUUSD
Outlook: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks): Bullish

Technical: Gold has tested and held the 1260 symmetry swing level, 1283 is now resistance for a further leg of corrective price action to set up a test of the pivotal 1240. A close over 1285 suggests early upside reversal targeting a retest of 1303 next.
Retail Sentiment: Bearish
Trading Take-away: Sidelines

USOIL
Outlook: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks): Bullish

Technical: Oil as 46.70 supports 50.00 becomes the material upside objective, with a symmetry swing target sited at 50.51 ahead of the larger AB=CD swing objective at 51.09, only a close below 43.00 threatens bullish bias.
Retail Sentiment: Bearish
Trading Take-away: Long