New York Forex Report: Equities Strong On Expectations Of ECB Easing

Equity markets remained firm over early European trading today with markets expectant of further monetary easing by the ECB next week, seeing US Dollar trading higher also. Copper and Oil were weaker so far today as Chinese data displayed further weakness with domestic industrial profits falling another 4.6% in October, adding to concerns over a slow-down in the world’s second largest economy.  Quiet session expected ahead with US markets closed early for Black Friday following on from yesterday’s Thanksgiving holiday.

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

Fundamental: EUR was sharply lower over the European morning as investor expectations mount for further easing to be introduced at next week’s ECB meeting. Improvements in EZ economic and services confidence managed to stem the bleeding so far heading into the US crossover.

Technical: While 1.07 caps intraday upside corrections, bears target a test of 1.05 next ahead of an assault on year to date lows. Only a close above 1.08 eases immediate downside pressure.

Interbank Flows: Bids 1.0550 stops below. Offers 1.07 Stops above.
Retail Sentiment: Bullish
Trading Take-away: Target achieved cover shorts +265pips, sidelines

eu2015-11-27 06_35_17-NetDania - NetStation

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

Fundamental: GBP was sharply lower over the European morning as 3Q GDP data came in at a lowly 0.5% which, although as expected, confirms the slowdown from the 0.7% April-June print, with net trade hitting an 18 year low.

Technical:  While 1.5160 contains upside reactions expect a test of of bids at 1.50 as the next bearish objective. Only a close above 1.5250 eases immediate bearish bias

Interbank Flows: Bids 1.5050 stops below. Offers 1.5250 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines

gu2015-11-27 06_36_12-NetDania - NetStation

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

Fundamental:. Japan Core CPI (YoY) was released overnight as -0.1% which did not surprise the market’s expectations. On the other hand, Japan’s unemployment rate was 3.1%, better than the market expectations. However, JPY seems unaffected by the data and it is now trading at around 122.63

Technical: While 122.50/30 supports downside reactions, market structure remains bullish to test 2015 highs next. A failure at 122 opens a test of 121.40 support next ahead of pivotal 120.

Interbank Flows: Bids 122 stops below. Offers 124 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines

uj2015-11-27 06_36_46-NetDania - NetStation

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

Fundamental: Ahead of next weeks ECB meeting and the high probability of further easing measures to be announced by the ECB the Euro remains under pressure and the negative cross flows continue to weigh on the pair.

Technical:  While 131.30 caps upside reactions expect a sustained break below 130 to confirm a retest of 2015 lows. Only a close above 132.50 eases immediate bearish pressure. Intraday initial upside hurdle is 130.50 while this caps upside corrections expect further grind lower to retest and break 129.70 lows.

Interbank Flows: Bids 130.50 stops below. Offers 132.50 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines

ey2015-11-27 06_37_27-NetDania - NetStation

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

Fundamental: AUD was softer over the European morning extending the weakness of recent days as Chinese data weakness weighs on price with Commodities sliding also.

Technical: While .7170/50 remains the bid zone expect grind higher to test .7350 area next, only a close below .7150 concerns near term bullish bias.

Interbank Flows: Bids .7150 stops below. Offers .7300 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines

au2015-11-27 06_38_06-NetDania - NetStation

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

Fundamental: CAD was softer over the European morning as a firmer US Dollar and weakening n Oil prices led USDCAD higher.

Technical: Bulls have the ball while 1.3280 supports intraday downside. A close below 1.3220 would ease the near term bullish bias and suggest a broader correction is underway.

Interbank Flows: Bids 1.3250 stops below. Offers 1.34 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines

uc2015-11-27 06_38_48-NetDania - NetStation

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