New York Forex Report: FOMC Minutes Eyed

New York Forex Report: FOMC Minutes Eyed

New York Forex Report: The USD is trading in mixed fashion against its G10 counterparts overall during the European session but retains a generally firm undertone. Commodities are mostly higher (gold and crude oil) but remain within recent ranges. US yields continue to firm, with the 2Y bond rates reaching 0.8745% a fresh, short-term cycle high and the highest level seen since June – providing good support for the USD. The US releases JOLTS data and there is a little Fedspeak this morning but the real focus for traders today will be the September FOMC minutes which will give traders a chance to gauge the level of dissent against holding policy steady at the meeting (recall three governors voted for a rate increase and Vice-Chair Fischer termed the decision a “close call”). A hawkish undertone to the minutes should bolster December Fed tightening probabilities; with one ¼ point tightening still not fully factored into the curve through the turn of the year, the USD can still make progress on the Fed story.

FX Majors: EUR In line with more upbeat Sentix investor confidence released a day ago, ZEW surveys showed the expectation index more than doubled to 12.3 in October in the Eurozone, signs investor confidence remained intact despite Brexit woes and other economic headwinds. GBP shed nearly 2% to trade as low as 1.2086 against the dollar on Tuesday as senior officials and investors pointed to the potential for more declines in a market still trying to recover from Friday’s 10% flash crash. Bank of England policymaker Michael Saunders said on Tuesday he would not be surprised if Sterling fell further, but the BoE could overlook the effect of weak sterling on inflation, possibly for years. GBP bounced overnight on news UK PM May backs down on parliament vote over her Brexit terms, asked for room to negotiate. JPY Reports from Japan also showed Japanese households and businesses were expecting conditions to pick up in the next few months. Eco Watcher outlook survey index climbed to 48.5 in September (August: 47.4) even though the current index skidded to 44.8 in September (August: 45.6) pointing to slight deterioration in current conditions

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

Technical: 1.1085 symmetry support removed, next downside objective is 1.0995 ahead of 1.0957. Near term resistance is sited at 1.11 over 1.1220 eases near term bearish bias.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: As 1.2330 rejects corrective advances bears target a retest of 1.20. Only a close over 1.25 eases bearish pressure.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Bullish attention on the upside equidistant swing corrective objective at 104.86 near term support is sited 102.80
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 116.11 symmetry swing resistance stalls advance A close over 116.50 opens the larger scale AB=CD objective at 121.00 Near term support is sited at 114.60 has been eroded, below 113.60 suggests an early reversal to trend.
Retail Sentiment: Neutral
Trading Take-away: Neutral

Commodities FX: GOLD price fell one the back of the stronger US dollar. The gold price decreased by US$4.50 to US$1,253. OIL markets rebounded strongly on Monday (10 Oct) after the Paris-based International Energy Agency’s monthly report said global oil supplies increased in September. The US Nymex WTI futures declined by US$0.56 to US$50.79. AUD Australia’s Westpac consumer confidence index climbed 1 point to 102.4 in October as households’ assessment on family finances improved. That was the highest reading in five months. CAD reversed most of the gains it made against the US dollar as oil prices fell from recent highs.

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

Technical: Symmetry swing resistance sited at .7685 stalls advance as this area contains .7550 primary downside objective achieved as .7615 caps corrections bears target .7412 symmetry swing support.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: As 1.30 supports 1.3372 is the equidistant AB=CD corrective objective, only below 1.2960 threatens near term bullish bias. Near term symmetry swing support is sited at 1.3130.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Anticipate test of 1229 symmetry swing support failure here lets bears target 1200 as the next downside objective, near term resistance is sited 1276 ahead of pivotal 1300.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Equidistant swing objective sited at 52.40 is the primary upside objective as 49.00 supports the advance , only below 45.00 would suggest false upside break a continuation of a more complex corrective pattern
Retail Sentiment: Bearish
Trading Take-away: Long