New York Forex Report: Brexit Volatility Weighs On Markets

New York Forex Report: Brexit Volatility Weighs On Markets

New York Forex Report: Heading into the final US session of the week and Brexit volatility continues to weigh on markets as investor uncertainty leads to low liquidity ahead of the UK referendum next week.USD remains weak following lackuster FOMC on Wednesday which failed to signal likelihood of rate-hike in coming months.

FX Majors: Markets remain trapped in viscous volatility with whipsaw dominating the flows over yesterday and today. No key data over the US session today but traders will be listening to ECB President Mario Draghi who speaks later today in Munich. Various ECB members have been commenting recently on the impact of Brexit and how the ECB will react.

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

Technical: Whipsaw price action within broader 1.11/ 1.14 range while 1.13 caps upside reactions bears have the ball and pressure a break of the range lows
Retail Sentiment: Bearish
Trading Take-away: Sidelines

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

Technical: Expected test of 1.40 next prompts sharp intraday reversal over 1.4350 suggests renewed attempt to test upper range and offers above 1.45. Failure at 1.4340 opens retest of yesterday’s lows.
Retail Sentiment: Bullish
Trading Take-away: Sidelines

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

Technical: Downside ratchet breaks 105.55 lows the failure at 105 opens 103 as the next downside objective. 105.50 becomes the near term pivotal resistance.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Weekly equality objective at 117.36 achieved. 118.50 becomes near term resistance only over 120.50 eases bearish pressure, while 118.50 caps upside bears target retest of 115.50 lows.
Retail Sentiment: Bullish
Trading Take-away: Short

Commodities FX: GOLD touched USD1315/oz as investors sort safe haven assets. However, the tragic death of a UK politician saw the suspension campaigning for the EU referendum and the GBP move higher, lessening the appeal of the precious metal Oil moved lower as supply restarts in Canada added to worries about global economic growth. However, reports that Nigerian crude output dropped even further while US gasoline demand climbed to a record in May highlights the glass half empty approach the market is taking at the moment. AUD rebounded in tandem with the GPB since a British member of parliament was shot dead in the street, markets rekindled sentiments supporting Britain to stay. The Australia’s May jobs data showed an economy in fairly good health. However, the external risks to growth were not lost on policy makers CAD dropped on Thursday amid the potential risk from Brexit and the slumped oil prices. Oil prices slumped about 4% and hit one-month lows on Thursday, setting down for a sixth straight day over the fear of global economic turmoil if Britain exits the European Union.

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

Technical: 7450 rejects upside reactions expect rotation to test .7230 support next as .7340 caps upside reactions.
Retail Sentiment: Bearish
Trading Take-away: Sidelines

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

Technical: 1.3150 is the next upside objective as 1.29 supports downside reactions. Failure at 1.29 opens pivotal support at 1.28.
Retail Sentiment: Bullish
Trading Take-away: Sidelines

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

Technical: 1331 is the next upside objective while 1280 now acts as near term support. Failure below 1275 sets up a bearish double top pattern targeting a rotation back to test 1230 support.
Retail Sentiment: Bearish
Trading Take-away: Sidelines

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

Technical: Only a close below 46 threatens medium term bullish bias, as 46.00 survives on a closing basis expect rotation back towards 50.00 where second wave of selling is likely to emerge.
Retail Sentiment: Bearish
Trading Take-away: Sidelines