London Forex Report: Tusk Pence Joint Presser Eyed

London Forex Report: Tusk Pence Joint Presser Eyed

London Forex Report: It will be a holiday shortened week for US, as financial markets will be closed Monday for Presidents Day. UK will be in focus today with the House of Lords holding its first debate on the government bill authorising PM Theresa May to trigger Article 50 (to begin the process of UK withdrawing from the EU) . All eys will be on US Vice-president Michael Pence and President of the European Council Donald Tusk who are holding a joint press conference. USD rebounded to beat 90% of its G10 peers on the back of strengthening refuge demand amid softer equities. The Dollar Index rallied in Asian and US sessions to jump 0.51% to 100.95.

FX Majors: EUR Eurozone’s current account surplus was down by €5.4 billion to €31.0 billion in December. Investment income slipped to €5.30 billion (previous: €12.20 billion), overshadowing the increase in goods trade surplus (€ 31.70 billion vs € 30.80 billion). On a separate report, construction output fell by 0.20% MOM in December after a 0.90% MOM increase in November. GBP UK’s retail sales slumped 0.30% MOM in January followed a 2.10% MOM drop in December. Household goods stores, food stores and non-store retailing posted the most drag on the headline retail sales number last month. JPY Japan January trade deficit Y1.086 trln, Y636.8 bln expected, exports +1.3% y/y, imports +8.5%, +4.7% expected for both, exports to US -6.6%, China +3.1%, Asia +6.0%, Trump uncertainty may have seen Japan car makers slow US shipments.

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

Technical: 1.0670 near term resistance, only over 1.0710 stabilises selling pressure. While upside hurdles remain in place expect a retest of 1.0521 base.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Equidistant swing objective at 1.2679 capping advance for now. Near term support sited at 1.2345 survives on a closing basis prompting sharp reversal suggesting a retest of recent cycle highs, a close below 1.2330 opens 1.2236 symmetry swing support. Near term resistance is sited at 1.2580
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Only a 112 sustained breach will open 110.70 symmetry swing support underpinned by 109.90 50% retracement of the move from August 2016 lows. Near term resistance sited at 113.80, a close over 114.50 reasserts upside targets primarily at 115.50
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Symmetry swing support at 120.40 removed, the failure below 120.40 opens 118.70 as the next downside objective. Near term resistance sited at 121.50 a close over 122.10 resets attention on upside targets.
Retail Sentiment: Bullish
Trading Take-away: Short

Commodities FX: GOLD price eased on Friday on the back of a broadly stronger US dollar outweighing US political uncertainties & elections risks in Europe. This gold price decreased by $2.40 to close at three-month high of $1,237.40. OIL prices edged higher on Friday (17 Feb) but still posted the largest weekly decline in a month on the back of growing US crude. The US Nymex WTI finished the session higher by $0.04 to close at $53.40. AUD Wage data is released on 22 February (Wednesday) with the consensus looking for a small uptick in quarterly wage growth to 0.5% from 0.4%. On a y/y basis, wages are expected to rise 1.9%, as they did in Q3 CAD Friday’s release of another round of inflation figures may incrementally inform BoC risks, but that’s unlikely to be a material effect. Headline inflation will likely rise a tick to about 1.6% y/y. That would keep inflation below the BoC’s 2% target and well within the 1-3% policy band.

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

Technical: The next upside objective is sited at .7750. Near term support is sited at symmetry swing level .7600 ahead of pivotal .7449
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 1.3150 resistance eroded, over 1.32 opens a move back to test 1.3370.Price action remains erratic as price attempts to base above pivotal 1.30. Near term support is sited at 1.3050, failure here opens a retest of 1.2967
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: The 1225 upside breach confirmed the anticipated move to 1245 as 1218 supports expect a retest of last weeks highs, a failure below 1206 opens a retest of 1180.
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Rejection from equality objective area at 55.30, a close below symmetry support at 50.68 confirms a medium term high and opens a retest of pivotal 49.00. Near term resistance is sited at 54.50.
Retail Sentiment: Bearish
Trading Take-away: Long

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