London Forex Report: Risk Partying Like Its 1999

London Forex Report: Risk Partying Like Its 1999

London Forex Report: Global financial markets remained in risk-on mode, hanging on to hopes President-elect Trump’s “new” policies will uplift growth and inflation for the US economy. The three headline US equity markets hitting all time highs on the same day for the first time since 1999. Meanwhile, further positive vibes seen on the data front also continue to cement the way for the Fed to raise rates next month. Existing home sales rose 2.00% MOM to annualised rate of 5.60 million in October, marking its highest level since February 2007 as low borrowing costs continued to buoy demand for properties. Richmond Fed manufacturing index rebounded to positive territory for the first time in four months in November, affirming that the sector was gathering steam in the final quarter of the year. USD climbed against 70% of its G10FX peers, while the USD Index bounced back from a lower opening to close largely unchanged at 101.04.

FX Majors: EUR Euro zone’s consumer confidence index came in at -6.1 in November (October: -8.0), marking the best reading since December 2015. Separately, Japan’s Nationwide department sales fell 3.90% YOY in October (September: -5.00% YOY). Household spending remained sluggish despite the government’s huge stimulus package, underscoring the challenge to revive falling price pressure. GBP European Union policy makers intensified their criticism of Prime Minister Theresa May’s plans to leave the bloc, saying that the UK appeared clueless about the implications of Brexit. The pound sank to an session low after Slovak Prime Minister Robert Fico said it’s not clear that the UK knows what it wants and European lawmaker Manfred Weber demanded May’s government produce clear proposals as it prepares to trigger Brexit negotiations by the end of March. Trader’s attention will shift to UK Chancellor Hammond’s Autumn statement JPY President-elect Donald Trump announced yesterday that he intends to begin the process of withdrawing the US from the Trans-Pacific Partnership agreement as soon as he takes office on 20 January. His announcement has left Japan’s political leadership into confusion after Tokyo had strongly backed the deal.

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

Technical: Bears have the ball the breach of 1.07 shifts bearish attention towards 2015 lows at 1.05. Near term resistance is sited at 1.07, medium term 1.0850 is a key upside hurdle which will need to be captured on a closing basis to stabilise the pair.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Bears target symmetry swing objective at 1.2270 as 1.2510 contains upside reactions, over 1.2520 opens a retest of 1.2580 ahead of 1.2670

Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Bulls achieve 1.11 pivot, while 1.0960 supports 1.1242 becomes the next upside objective representing the 50% retracement of the 2015/16 decline. Below 1.0830 opens 1.0740, only below 105.50 concerns bulls
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 116.20 primary upside objective achieved, this level now becomes near term support.The top side expansion through 117 opens 121.41 equidistant swing objective. A break back below 116 opens 115.30, only close below 114.60 questions bullish thesis
Retail Sentiment: Bearish
Trading Take-away: Long

Commodities FX: GOLD edged lower after US equities hit all-time highs on expectations for higher growth and more spending from a Donald Trump presidency. Notably, the previous metal has fallen more than $100/oz from its post-election peak on 9 November as US Treasury yields posted their biggest two week rise in more than five years and the dollar shot higher. OIL prices gave up gains in a volatile trading session on the back of worries that Iran and Iraq were not ready to agree on an OPEC output freeze after prices earlier rose to the highest level this month on reports cartel members had overcome their internal disputes. The market will remain sensitive to comments from officials ahead of the meeting of the OPEC on 30 November. AUD edged higher as the upbeat global stock markets and commodity prices continued to support the overall market sentiment. US stocks closed higher, hitting new all-time highs, as investors continued to digest US President-elect Trump’s policy agenda. CAD Canadian retail sales rose 0.6% MoM in September, broadly in line with market expectations, according to data from Statistics Canada.

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

Technical: The breach of 7412 symmetry support now opens .7092 AB=CD. as the next downside objective. Near term resistance is sited at .7440 ahead of pivotal 7530
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: 1.3573 achieved expect some profit taking pullback is testing symmetry support at 1.3407, as this area contains the pullback 1.3620 becomes the next upside objective. Only a close below 1.3250 concerns the bullish bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Bears achieve the targeted equidistant swing objective sited at 1203, near term resistance is sited at 1223 as this level contains 1190 is the next downside objective. Only a close over 1240 stabilises the decline..
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Offers emerge at 48.92 equidistant swing resistance as this level contains upside reaction opportunity for a move to the downside targeting symmetry swing objective at 39.78. A breach of 49.00 opens a quick test of offers above 50.00 .
Retail Sentiment: Bearish
Trading Take-away: Long

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