New York Forex Report: BOE Sounds Brexit Warning Bells

New York Forex Report: BOE Sounds Brexit Warning Bells

New York Forex Report: Traders now await key US data tomorrow with the release of Advance Retail Sales for April and also the University of Michigan Confidence Survey. Both data points are expected to register a slight improvement from the last. Alongside this data we also have comments from Fed’s Williams who speaks in Sacramento during the New York afternoon.

FX Majors: The European morning on Thursday was dominated by the Bank of England’s May rate decision. Rates were left unchanged as expected amidst a rather Dovish outlook which saw growth forecasts lowered over the remainder of this year and the next two. Alongside this the BOE were keen to highlight the damage already caused by Brexit uncertainty, to which they attribute the 9% fall in Sterling since Nov, and noted that they see both unemployment and inflation rising in the event of a Brexit, which would lead to materially lower economic growth.

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

Technical: A failure at 1.1350 failure opens a return to retest 1.1240 support. While 1.1350 survives as support expect a test of 1.1487 en route to a retest of 1.1616 highs
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: The failure at 1.4470 opens a deeper correction to 1.4280 next. Downside momentum loss suggest a base attempt to test resistance is now sited at 1.4590/1.46 before lower
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: 105.50 weekly swing objective achieved, 107.50 resistance now becomes support as the corrective move aims to retest 110 from below
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Bears now target weekly symmetry objective at 120.60. The breach of intraday resistance at 123.30/50 targets 126.80 a close above here eases immediate downside pressure
Retail Sentiment: Neutral
Trading Take-away: Neutral

Commodities FX: Oil prices traded higher over the European morning on Thursday after the International Energy Agency noted that the stock of global Oil will see a “dramatic reduction” in H2 due to falling supply and strong demand with recent production outages having tempered production.

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

Technical: Initial test of .7330 attracts buyers resistance is sited at .7490. A failure at.7300 threatens medium term bullish bias, below .7240 establishes a bearish medium term stance.
Retail Sentiment: Bullish
Trading Take-away: Sidelines

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

Technical: 1.30 upside objective achieved expected correction to retest 1.2740/60 from above as this level should now act as support for further upside corrective action.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Gold has tested and held the 1260 symmetry swing level, 1283 is now resistance for a further leg of corrective price action to set up a test of the pivotal 1240. Over 1285 suggests early upside reversal targeting a retest of 1303 next.
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Oil While 43.00 supports the bullish consolidation the break of 44.90 set ups a retest of prior cycle highs at 46.76 with 47.78 the next upside objective. Failure at 43.00 opens a move to 41.90 as the next support level.
Retail Sentiment: Bearish
Trading Take-away: Long