New York Forex Report: Dollar Dips

New York Forex Report: Dollar Dips

New York Forex Report: Today’s Dollar dip reinforces the view that after 10 days of consecutive gains (higher daily closes) since early November which has delivered a near 6% rally in the USD Index, the market is prone to a correction or at least a consolidation. This morning, the USD has slipped against most of its G10FX peers. Markets are confronting a holiday-shortened week, with US Thanksgiving on Thursday; there are, however, some important data points and event risks to monitor, US durable goods, the US FOMC minutes from the November meeting and the UK Autumn statement (on the economy and fiscal policy) will be eyed by traders before vacation.

FX Majors: EUR Euro zone’s current account surplus dropped to € 25.3 billion in September (August: € 29.1 billion). Surplus slumped to the lowest level in almost a year due to the decline in investment income (- 3.80% MOM). GBP traders expect weaker growth and turbulence around talks on Britain leaving the EU to weigh on GBP next year, some participants have begun to argue that a 20% fall since last December is enough to deal with Britain’s large external deficit and aid to re-balance the economy JPY Japan’s trade surplus came in at 497.6 billion yen in October which was 1.4 billion yen short of the surplus in the previous month. Imports fell 97.3 billion yen while exports dropped a heftier 98.7 billion yen, narrowing the trade gap.

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

Technical: Bears have the ball the breach of 1.07 shifts bearish attention towards 2015 lows at 1.05. Near term resistance is sited at 1.07, medium term 1.0850 is a key upside hurdle which will need to be captured on a closing basis to stabilise the pair.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: 1.23 objective achieved, next support sited at the symmetry swing objective of 1.2270. Near term resistance is sited at 1.24 only a close over 1.25 resets attention on upside objectives.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Bulls achieve 1.11 pivot, while 1.0960 supports 1.1242 becomes the next upside objective representing the 50% retracement of the 2015/16 decline. Below 1.0830 opens 1.0740, only below 105.50 concerns bulls
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 116.20 primary upside objective achieved, this level now becomes near term support.The top side expansion through 117 opens 121.41 equidistant swing objective. A break back below 116 opens 115.30, only close below 114.60 questions bullish thesis
Retail Sentiment: Bearish
Trading Take-away: Long

Commodities FX:

GOLD hit its lowest since late May on Friday as the dollar surged to a near 14-year peak on expectations for a US rate hike in December and higher fiscal spending from US President-elect Donald Trump’s incoming administration. OIL prices eked out gains despite a stronger dollar and rising US oil rig count, as hopes that OPEC might agree to limit production cuts at the end of the month boosted sentiment. The OPEC is reportedly moving closer to finalising its first deal since 2008 to limit output, with most members prepared to offer Iran flexibility on production volumes, ministers and sources said. AUD sank to multi-month lows due to the broad strength of US dollar after Federal Reserve Chair Janet Yellen signalled US interest rates will probably rise next month. The Aussie has tumbled around 5% since 8 November as Donald Trump’s victory in the US presidential election raised the spectre of faster US inflation. CAD Canada’s annual inflation rate picked up to 1.5% in October, matching analysts’ expectations. But the core rate cooled slightly to 1.7% from 1.8%, hitting the lowest level since July 2014. CAD weakened slightly against the USD as higher oil prices were offset by broader gains for the USD and cooler domestic core inflation

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

Technical: The breach of 7412 symmetry support now opens .7092 AB=CD. as the next downside objective. Near term resistance is sited at .7410 ahead of .7504.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: 1.3573 achieved expect some profit taking pullback is testing symmetry support at 1.3407, as this area contains the pullback 1.3620 becomes the next upside objective. Only a close below 1.3250 concerns the bullish bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Bears achieve the targeted equidistant swing objective sited at 1203, near term resistance is sited at 1232 as this level contains 1190 is the next downside objective. Only a close over 1280 stabilises the decline.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Next downside objective is the symmetry swing objective at 39.78. Only a close over 47.33 stabilises the decent a eases bearish pressure, near term support is sited at 45.30
Retail Sentiment: Neutral
Trading Take-away: Neutral