London Forex Report: Welcome To Q4

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

Fundamental: EUR trades below 1.1150 this morning tracking risk-on appetite. EUR’s status as a funding currency remains in play. Price action continues to suggest an inverse relationship between risk assets and EURUSD. Month end flows have faded and the strong ADP data state side is weighing on the single currency.

Technical: Sustained breach of 1.12 sets up a retest of bids below the 1.11 handle. Intraday support sited at 1.1130 failure here sees 1.11 back in bears sites with stops below to be revisited

Interbank Flows: Bids 1.1150/30- 1.1080/60 stops below. Offers 1.12 -1.1250 Stops above.
Retail Sentiment: Long to neutral
Trading Take-away: Sidelines for now

eu2015-10-01 07_43_06-NetDania - NetStation

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

Fundamental: GBP firmed on 2Q GDP and current account data; traded a high of 1.5214 but strength was reversed into NY close overnight amid USD strength. 2Q final GDP held up on q/q basis but was slightly lower on y/y basis. 2Q current account deficit narrowed to lowest level in 2 years.

Technical: Remains under pressure while capped by 1.52 resistance, next downside objective is a test of 1.50 psychological support.

Interbank Flows: Bids 1.5130/10 stops below Offers 1.5210/30 stops above
Retail Sentiment: Bullish
Trading Take-away: Sell pullbacks against 1.52 targeting 1.50.

gu2015-10-01 07_43_51-NetDania - NetStation

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

Fundamental: USDJPY ended 3Q at 119.67 underpinned by safe haven flows. Pair back above the 120 -handle this morning, 3Q Tankan Report was mixed, which could spur the central bank to add to its easing at its October meeting

Technical:  Likely range bound trade persists ahead of Friday’s NFP release. 119 the bid 121 the offer for now, topside break targets 122.50 while a downside breach targets 118.

Interbank Flows: Bids 119/118.80, 118.50/30 stops below. Offers 120.50/80 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

uj2015-10-01 07_44_38-NetDania - NetStation

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

Fundamental: Third quarter BOJ Tankan survey numbers were in line with experts’ call, little softer from previous quarter. However, capital expenditure rose to 10.9% from 9.3%. Mixed domestic data and the weaker EUR weighs on EURJPY.

Technical: Interim support at 134 eroded next downside objective is a retest of bids at 132. 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 133.80/50 stops below. Offers 135.10/30. 135.50 stops above
Retail Sentiment: Neutral
Trading Take-away: Sidelines for now

ey2015-10-01 07_45_32-NetDania - NetStation

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

Fundamental: AUDUSD was easing back from yesterday highs of 0.7038 at first ahead of China’s PMI-mfg release. Print was 49.8, firmer than expected and better than the Aug number.Improvement in the Chinese PMI numbers gave AUDUSD a push higher.

Technical: Relief rally as positions are pared into tomorrows headline risk event. While offers at .71 cap upside attempts bears targets new year to date lows.

Interbank Flows: Bids .6850 stops below. Offers .7080/.7100 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for now

au2015-10-01 08_33_09-NetDania - NetStation

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

Fundamental: USDCAD slumped towards the 1.33 figure on Wednesday and hovers below there this morning. Growth in July eased less than expected to 0.3%m/m from previous 0.4% (revised). Year on year, growth accelerated to 0.8% from previous 0.5%.

Technical: Despite the pullback, uptrend is still intact and pair has come off from overbought conditions. While 1.3260 supports intraday downside reactions expect new trend highs en route to test projected ascending trend line resistance at 138 next.

Interbank Flows: Bids 1.3250 stops below. Offers 1.35 stops above
Retail Sentiment: Bearish to Neutral
Trading Take-away: Sidelines for now

uc2015-10-01 08_44_52-NetDania - NetStation

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