London Forex Report: NFP Shocker Shakes USD Bullish Sentiment

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

Fundamental: The Euro jumped above 1.13 handle after US non-farm report missed market expectations with downward revisions on priors months data. The success of the ECB’s quantitative easing program will be pivotal on how well the Eurozone economy recovers over the next year or so, S&P said in its report late Friday. Spain’s ratings raised to BBB+ from BBB on reforms by S&P.

Technical: Headline risk volatility spike sees Euro trade through 1.13 resistance but offers ahead of 1.1350 repel advance, overnight retest of bids below 1.12 attracts buyers. While 1.12 supports expect another test of 1.1350 offers. Failure at 1.12 open retest of 1.1150 next

Interbank Flows: Bids 1.1130/50 stops below. Offers 1.1350 Stops above.
Retail Sentiment: Neutral
Trading Take-away: Sidelines for now

eu2015-10-05 07_56_18-NetDania - NetStation

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

Fundamental: GBP rebounded from five-month lows against the dollar as a US nonfarm report showed that employers added fewer jobs in September than the forecast, damping speculation the Federal Reserve could raise interest rates for the rest of the year. GBP posted another weekly decline as traders worried about a delay of US interest rates hike would also keep the Bank of England’s key rate at a record low for longer

Technical: Testing offers towards 1.5250 resistance tone remains bearish while 1.53 caps the upside reaction. While 1.53 stems the advance on a closing basis next downside objective is a test of 1.50 psychological support. A close above 1.53 opens 1.54 as the next upside objective.

Interbank Flows: Bids 1.5080/60 stops below. Offers 1.5250-1.53 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

gu2015-10-05 07_56_58-NetDania - NetStation

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

Fundamental: The USDJPY rebounded sharply more than 100 pips from daily lows and trimmed losses overnight. The pair weakened after US non-farm payrolls data surprised to the downside, boosting the demand of the yen across the board amid risk aversion. The yen pulled back in the market during the late New York session as US stock markets moved off daily lows and finally turned bullish.

Technical: Bids towards 118.50 hold strong once again, now trading back to the midpoint of the recent range. For now play range 121.50 the offer and 118.50 the bid until broken.

Interbank Flows: Bids 118.50/30 stops below. Offers 121.50 stops above
Retail Sentiment: Neutral
Trading Take-away: Sidelines for now

uj2015-10-05 07_57_28-NetDania - NetStation

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

Fundamental: EURJPY was a big beneficiary of the reversal in risk sentiment Friday combined with the cross flows into the EUR. Price action in the week ahead could be rangy, especially ahead of BOJ meeting on Wednesday where traders watch for hints of shift in dovish stance.

Technical: 134 intraday support to watch a failure here targets a retest of 133 bid. While 134 survives on a closing basis offers at 135 and stops above. A close above 135 opens a retest of upper end of the recent range and a retest of offers at 137 next.

Interbank Flows: Bids 143 stops below. Offers 135.10/30 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

ey2015-10-05 07_57_55-NetDania - NetStation

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

Fundamental: The Aussie held a bullish bias after Australian retail sales matched the forecast, but failed to sustain the gain upon the release of disappointing US non-farm payrolls data despite broad USD weakness. The currency turned to a bearish as the weak US employment data release fueled concerns over the global growth outlook.

Technical:Rally stalls ahead of .71 resistance. While offers at .71 cap upside attempts bears targets new year to date lows. A breach of .71 resistance targets a retest of offers towards September highs towards .7270.

Interbank Flows: Bids .6850 stops below. Offers .7100 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

au2015-10-05 07_58_28-NetDania - NetStation

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

Fundamental: USDCAD closed at daily lows of 1.3150s Friday. Reversing by more than 300pips from the fresh 11-year high of 1.3457 reached last Wednesday. The Lonnie posted the best weekly gain since April and was strengthened for the third day in a row after the better-than-expected GDP report released on last Wednesday before profit taking flows kicked in.

Technical: Testing downside symmetry objective at 1.31 while this area supports potential for trend continuation a failure here confirms a shift in tone a and focus shifts to larger symmetry and psychological support at 1.30

Interbank Flows: Bids 1.31 stops below. Offers 1.33 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

uc2015-10-05 08_00_55-NetDania - NetStation