New York Forex Report: European PMI’s Broadly In Line

New York Forex Report: European PMI’s Broadly In Line

New York Forex Report: Range bound trade during this mornings European trade as markets digest yesterdays moves with the Dollar stabilising post yesterdays losses. Headline data releases came in broadly in line with expectations UK Markit CIPS services PMI 47.4 vs 47.4 expectation. Eurozone Markit services PMI final reading for July registered 52.9 marginally beating the 52.7 expectations. Japanese PM Abe was on the wires confirming that he will not looking be looking to extend his term as LDP President, further confirming that Finance Minister Aso will remain in place during the cabinet reshuffle.

FX Majors: EUR surged above 1.12 for the first time since Brexit referendum yesterday as the dollar was broadly weakened due to the expectations that the Federal Reserve would delay raising interest rates after recent soft US economic data. GBP gained more than 1% against the USD on Tuesday to near its highest for three weeks, as the dollar fell broadly due to the diminishing expectations that the Federal Reserve would hike rate at the next meeting given a series of weak US economic data. JPY gauge of consumer confidence ticked down to 41.3 in July (June: 41.8) from the five month high in the previous month. The softer reading was due to weaker assessment on the job market. Surveys showed that households anticipate less employment opportunities and smaller income growth.

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

Technical: Advance stalls at symmetry swing resistance 1.1230, as 1.1180 supports expect a retest of yesterdays high a second close above 1.12 will embolden bulls to target broader range resistance sited at 1.14
Retail Sentiment: Bearish
Trading Take-away: Sidelines

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

Technical: The breach of 1.3330 shifts attention back to 1.3550 symmetry swing objective. Near term support is sited at 1.32
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: The close below 103 will see bears target a retest of cycle lows below 100. Near term resistance is sited at 102.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Below 113 opens 110.80 as the next downside objective. Near term resistance is sited at 114.50
Retail Sentiment: Neutral
Trading Take-away: Neutral

Commodities FX: GOLD rose as European equities fell and the USD hit its lowest in over a month versus the EUR, after last week’s soft US GDP data dented expectations for a near-term interest rate hike by the Fed. Oil prices fell more than 1%, erasing earlier gains and pushing US crude back below $40/bbl as persistent worries of a glut offset the impact of a weak dollar that initially propped the market. A slide in US equities also forced US crude futures, which plunged below the $40/bbl-level on Monday for the first time since April, to give back early gains of as much as 2%. AUD RBA delivered a 25 bps cut to its benchmark rate, pushing it down to a fresh record low of 1.50%. Market has anticipated the cut amid looming disinflation as headline CPI dropped to a seventeen year nadir last quarter. In addition, the central bank preferred lower Australian dollar as “terms of trade remain much lower than they had been in recent years”, strengthening the case for rate cut. CAD commodity-linked Canadian dollar pared gains against the US dollar as oil turned lower, while weaker-than-expected US figures last week weighed on the US dollar.

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

Technical: Offers above resistance sited at .76 continues to cap upside attempts. Range resistance is sited at .7676 with range support now at .7400
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Breach of 1.3060 opens 1.2965 symmetry swing support as this level attracts bids expect a further higher to target equidistant swing target of 1.3380

Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Anticpated breach 1360 sets bulls sites on 1391 as the next upside objective, neart term support is sited at 1354. Below 1300 opens 1270
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Breach of bids at 41.87 opens 38.19 as the next downside objective, expect 41.87 prior support to act as resistance, a close over 44.40 is required to ease bearish pressure.
Retail Sentiment: Bullish
Trading Take-away: Sidelines