London Forex Report: USD Bid With Better US Data, ECB Eyed

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

Fundamental: EUR retreated from the height of its gains after reaching a one-month high of 1.1495, the pair grinded lower during the US session and hit below 1.1350 level last week. European Central Bank Governing Council Member Nowotny said both headline and core CPI in Eurozone are “clearly” undershooting the institution’s goal, signalling that more monetary stimulus may be needed for the economy.

Technical: 1.1410/30 now a pivotal bull/bear battleground, while this area contains upside reactions expect further weakness and retest of 1.13 bids. A breach of 1.1450 refocuses bull on the 1.1740 range highs

Interbank Flows: Bids 1.13 stops below. Offers 1.1520 Stops above.
Retail Sentiment: Bearish to neutral
Trading Take-away: Sidelines for now

eu2015-10-19 07_26_26-NetDania - NetStation

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

Fundamental:  GBP traded in tandem with the EUR,  the pair hit 1.5485 high before slipped further towards 1.5430 level and closed there. Bank of England policy maker Kristin Forbes said UK economic prospects can survive the current difficulties in emerging markets, and the next move in UK interest rate will be up “sooner rather than later”

Technical:  While 1.5380 supports downside reactions expect a grind higher to test 1.56 symmetry objective. A breach of 1.5360 targets a retest of pivotal 1,53 support.

Interbank Flows: Bids 1.54 stops below. Offers 1.5550 stops above
Retail Sentiment: Bearish to neutral
Trading Take-away: Buy pullback against 1.5380 targeting 1.56

gu2015-10-19 07_27_07-NetDania - NetStation

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

Fundamental: USDJPY  traded largely above 119 Friday, and the pair surged to 119.66 high
after US Michigan sentiment and current conditions data released better than expected. BOJ Governor Kuroda had the first public speech after back from the G20; he expected Japan’s
economy to continue moderate recovery and monetary easing will be unlikely to expand

Technical: While 119.50 caps upside expect further bearish price action and further exploration of stops sub 118.50, a failure at 118 emboldens bearish spirits and targets 116 next. A close above 119.50 opens a retest of 120.50 next.

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

uj2015-10-19 07_27_46-NetDania - NetStation

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

Fundamental: A late move last Friday saw the pair push as high as 135.90 in the catch up with equities. The pair has since edged down a little, currently hovering around the 135.60 region. This week, the key highlight Japan’s economic docket is September’s trade on Wednesday, likely to be back in positive territory.

Technical:  While 136 caps upside reactions expect a retest of yesterdays low at 134.80 a failure here sets bearish tone targeting 133.40 next. A break back above 136.00 eases bearish pressure and sets a retest of 137.

Interbank Flows: Bids 134.80/60 stops below. Offers 137 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

ey2015-10-19 07_28_16-NetDania - NetStation

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

Fundamental: AUDUSD opened Friday at the high and slightly rallied to 0.7338, but then the pair eventually turned lower towards 0.7250 into the New York close. Traders will look forward to the RBA meeting minutes this week, in addition retail sales and industrial production data, which might hinder the upside of the Aussie dollar

Technical: The snap back breach of .7300 targets a retest of .7400 offers. Another breach of .7300 against overnight highs targets .7160 equality corrective objective.

Interbank Flows: Bids .7200 stops below. Offers .7400 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

au2015-10-19 08_44_48-NetDania - NetStation

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

Fundamental: Canadians will vote in a federal election today that might put an end to the decade-long reign of Prime Minister Stephen Harper’s Conservatives. Canadian factory sales declined by 0.2 percent in August, the first decline in four months was smaller than the market expected as dampened by falling energy prices which curbed gains for auto makers.

Technical: Near term bearish tend remains intact as intraday resistance at 1.2950 contains intraday upside reactions bears target a retest of bids below 1.2850. A breach of 1.2950 opens test of 1.3060 offers next.

Interbank Flows: Bids 1.2850 stops below. Offers 1.3060 stops above
Retail Sentiment: Neutral to bearish
Trading Take-away: Sidelines for now

uc2015-10-19 08_45_26-NetDania - NetStation