London Forex Report: USD Bid On Safe Haven Flows

The USD ended higher across board in the first session after the Paris terror attacks, with the USD Index finishing at 99.40, highest close since mid-April. Market now looks poised to test the psychological 100 handle in the coming sessions. Data bag were mixed with trade activities indicators continue to under perform hampered by sluggish global demand while conditions over in the euro area and UK improved. While deflationary risks in the euro zone temporarily receded in October, lackluster price pressure may still prompt ECB to expand or extend its asset purchase program in its next review.

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

Fundamental: Eurozone October Core Consumer Price Index (YoY) was released as 1.1%, better than market expectations 1%, but it did not stop Euro from stumbling. EURUSD dropped nearly one percent, as traders continue to expect an interest rate hike from Fed.
EUR fell to near 6-1/2-month lows, versus the USD at 1.0672. Euro is suffering pressure as ECB President Draghi has been viewed by traders as signaling ECB will ease more next month

Technical: While 1.07 caps intraday upside corrections, bears target a test of 1.0560 next ahead of an assault on year to date lows. Only a close above 1.08 eases immediate downside pressure.

Interbank Flows: Bids 1.06 stops below. Offers 1.0750 Stops above.
Retail Sentiment: Bullish
Trading Take-away: Short 1.0830 targeting 1.0560

eu2015-11-17 07_32_31-NetDania - NetStation

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

Fundamental: GBP edged marginally lower overnight as traders continue to focus on the monetary policy divergence between BoE and Fed. Focus will be on UK CPI data today which might provide further guidance on future BoE monetary stance.

Technical:  While 1.5250 contains upside reactions expect a test of of bids at 1.50 as the next bearish objective. Only a close above 1.53 eases immediate bearish bias

Interbank Flows: Bids 1.50 stops below. Offers 1.5250 stops above
Retail Sentiment: Bullish
Trading Take-away: Sell 1.5280 stops above 1.5350 Target 1.50

gu2015-11-17 07_33_04-NetDania - NetStation

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

Fundamental: USDJPY opened at 122.32 and rebounded to a high of 123.33 to start the Tuesday session. Japan annualized third quarter GDP was released as -0.8%, seriously worse than the market expectation -0.2%. Markets are betting if BoJ will enlarge their easing programme due to the weak figures.

Technical: While 122.50/30 supports downside reactions, market structure remains bullish to test 2015 highs next

Interbank Flows: Bids 122 stops below. Offers 124 stops above
Retail Sentiment: Bearish
Trading Take-away: Long 122.50 stops below 122 target 125.50

uj2015-11-17 07_33_44-NetDania - NetStation

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

Fundamental: JPY initially gained during the Asian session on Monday as markets responded to the Paris attacks, eclipsing the poor Q3 Japanese GDP. However the gains were later surrendered as Wall Street climbed and as markets refocused on the poor GDP
report.

Technical:  Only a close above 133.50 eases immediate bearish pressure, while 132.50 caps upside reactions expect retest of 130.50 lows

Interbank Flows: Bids 130.50 stops below. Offers 132.50 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

ey2015-11-17 07_34_54-NetDania - NetStation

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

Fundamental: AUD edged back through 0.71 overnight as markets continued to price in a Fed rate hike in December. Meanwhile in the latest meeting minutes, RBA appeared optimistic about the improvement in economic conditions over recent months, pushing the Aussie through 0.71 handle. Under the lack of domestic data this week, the USD is expected to be the key driver for AUDUSD, in which attention will turn to US CPI and FOMC meeting minutes due today and Thursday respectively.

Technical: While .7170 caps corrective upside reactions expect a retest and breach of .7010 as bearish momentum builds for a retest of year to date lows. A close above .7200 eases bearish pressure

Interbank Flows: Bids .7000 stops below. Offers .7170 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

ey2015-11-17 07_34_54-NetDania - NetStation

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

Fundamental: CAD  lifted following a bounce in the price of crude oil, improving from its weakest level in more than six weeks after a surprise fall in domestic manufacturing. Crude oil rose after strong losses recently as the Paris attacks elevated the prospect of heightened
geopolitical tensions that could threaten global supply. US crude prices settled up 2.45 percent to $41.95, while Brent crude added 0.8 percent to $44.83.

Technical: While bids at 1.33 cap intraday downside reactions bulls now target a retest of 2015 highs, only a close below 1.3260 eases immediate bullish pressure.

Interbank Flows: Bids 1.3250 stops below. Offers 1.34 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

uc2015-11-17 08_25_28-NetDania - NetStation