London Forex Report: Trump Trade In Trouble

London Forex Report: Trump Trade In Trouble

London Forex Report: Markets turned risk-off as optimism over potential boost from Trump’s new policies continued to fizzle out in the absence of policy details. Recall President Trump said more than a month ago that new tax reforms will be announced within weeks but we have yet to hear any measures as yet. This somewhat reinforced longstanding concerns that expectations over Trump’s new policies and growth agenda are being overplayed. USD extended its decline against 70% of its G10 peers as markets continued to unwind bullish bets in the absence of positive catalysts. The Dollar Index tumbled in early Asian and European sessions, to close 0.59% lower at 99.81.

FX Majors: EUR President Donald Tusk of the European Council announced that the first EU summit to prepare the guidelines for the other 27 countries regarding Brexit will take place on 29 April. GBP Three separate inflation indicators showed that UK’s price pressure was on the rise. Consumer prices surged 2.30% YoY in February, its quickest pace in 41 months after an increase of 1.80% YoY in January. Factory prices climbed 3.70% YoY while retail prices surged 3.20% YoY last month as the rise in global commodities prices fed through the supply chain, putting furher upside pressure to consumer inflation. JPY Japan’s trade balance turned to a surplus of ¥813.4 billion in February followed deficits of ¥1087.6 billion in January. The positive reversal in trade balance was driven by the 17.1% increase in exports and 15.0% drop in imports last month.

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

Technical: As 1.07 supports 1.0830 is the primary upside objective ahead of 1.0985 equidistant swing objective. A close back below 1.0620 would concern near term bullish bias
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 1.2450 upside objective achieved as symmetry swing support at 1.24 supports 1.2570 becomes the next upside objective only below 1.2370 concerns near term bullish bias
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 111.75 downside objective achieved a daily close below here suggests downside range break and opens 108.43 equidistant swing objective to the downside, near term resistance is sited at 112.20
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: A closing breach of 120 concerns near term bullish bias and opens a test of pivotal 119.30. Near term resistance is sited at 121 only over 122 arrests near term selling pressure
Retail Sentiment: Bullish
Trading Take-away: Short

Commodities FX: GOLD rallied as a strong performance from centrist presidential candidate Emmanuel Macron in a French election debate and fading expectations for near term US interest rate hikes pushed the dollar to a six-week low versus the euro. OIL slumped through $48 a barrel, seeing its lowest level since November as the market discounted the latest talk by OPEC that it would extend output cuts beyond June. The decline also came ahead of the release of weekly US crude inventory data later Tuesday and on Wednesday that is expected to show a crude stock build of 2.6 million barrels. AUD Australia Westpac leading index slipped 0.07% MOM in February, dropping at its quickest pace in eight months followed an increase of 0.03% MOM in January. The forward looking indicator reflected modest economic growth in the first quarter of the year. CAD Canadian retail numbers continues the trend of positive economic data as it came in at 2.2% vs 1.5% for January- beating estimates by a healthy margin. BoC Deputy Governor Schembri is set to speak today on business investment. His comments may begin to set the tone for the BoC heading into next month’s (April 12) policy decision and MPR forecast update.

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

Technical: Pivotal .7740 test achieved near term support is sited at .7630 as this level supports downside reactions bulls look for a test of weekly symmetry resistance sited at .7870

Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Symmetry swing objective sited at 1.3480 achieved, bulls target 1.3598 . Only a close below 1.33 concerns the near term bullish bias and opens a move back to test the base break at 1.32
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Broader correction has developed retesting 1241 a daily close above here opens 1263 potential double top set up, near term support is sited at 1235

Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Price is now testing primary trend line support from the February 2016 lows at 48.70 while this are supports there is an opportunity to retest range support at 51.00 as this level caps upside reactions bears target 45.20 as he next downside objective
Retail Sentiment: Bullish
Trading Take-away: Short

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