New York Forex Report: Market Digests US Presedential Shock

New York Forex Report: Market Digests US Presedential Shock

New York Forex Report: The US election delivered the decisive win, just not the one that many had expected – even into early evening last night. The polls were wrong, the national mood mis-understood, the voter tracking ahead of the decision inaccurate and the result a stunning win for the outsider; it sounds like Brexit all over again. President-elect Trump’s win presents markets with enormous uncertainties; his position on key tenets of his campaign has wandered and the impact of his broader policy themes appear potentially contradictory trade conflicts, immigration versus a pro-growth fiscal policy and it may take investors some time to come to a firm position on what this means for the future. The president-elect’s first remarks to the country sounded conciliatory and helped markets steady after the initial sell-off but for now, the over-arching theme is uncertainty; equities are broadly lower, Treasuries have weakened, gold is bid and the “sell North America” mood in the FX space is reflected in the USD’s under-performance versus the EUR and JPY, the CAD’s relative weakness and the sharp plunge in the MXN to just under 20.00.

FX Majors: EUR On the release front, German Industrial Production disappointed the markets with a decline of 1.8 percent, well short of the forecast of -0.4 percent. While Germany’s surplus narrowed to EUR 21.3 billion, missing the forecast of EUR 23.4 billion GBP UK’s industrial production fell 0.40% MOM in September and August as continued maintenance at North Sea oilfields weighed down on the oil & gas sector. Production in the mining & quarrying and the utilities sectors were also lacklustre, overshadowing the robust manufacturing sector. Sterling’s depreciation has boosted demand for Britain’s goods and kept factories production on solid footing JPY Indicating slight improvement in economic conditions in September, a preliminary reading of Japan’s coincident index came in slightly higher at 112.1 versus August’s reading of 111.9. On the contrary, the gauge of economic optimism in the same month showed that businesses were anticipating business conditions to deteriorate in the next few months.

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

Technical: Near term support is sited at 1.0980 failure here opens pivotal 1.0850. 1.1150 is near term resistance
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Medium term resistance is sited at 1.2550. A close over 1.2550 eases bearish pressure. Interim support is sited at 1.24, below 1.2350 suggests false upside break and return to broader range trade.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Whipsaw price action within a broader range over 105.50 opens a move to target 107.40, below 101.10 opens pivotal 100
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Upside attention on 116.20 as the primary upside objective with in in the broader 112-116 range. A tops side expansion through 116 opens 121 equidistant swing objective. Back below 114 opens 112 again.

Retail Sentiment: Neutral
Trading Take-away: Neutral

Commodities FX: GOLD jumped nearly 5% to its strongest in six weeks as investors sought safe havens after Republican Donald Trump moved to the brink of winning the White House, setting world markets on edge. OIL whipsawed lower on market uncertainty AUD Australia’s Westpac consumer confidence index dropped to 101.3 in November (October: 102.4). The survey showed that households anticipated economic conditions to worsen in 5 years. CAD Structural weaknesses are weighing heavily on Canada’s export sector but an improved mix of fiscal and monetary policy release some pressure off the central bank to stimulate demand, a senior Bank of Canada official said.

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

Technical: AUD continues to rotates in the upper end of the contracting range with .7730 capping upside and .7500 containing downside reactions, a breach of the lower end of the range opens .7412 symmetry support. Through .7750 opens .7830 on the upside.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: 1.35 target achieved, as 1,32 supports bulls target a test of 1.3573 only below 1.2960 threatens this objective and suggests a test of pivotal 1.2820.

Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: As 1337 contains the upside reaction expect a retest of support back at 1245. Over 1340 opens pivotal 1375
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: The failure at 46.03 has opens 42.73 as the next downside objective ahead of 39.78. Near term resistance is sited at 44.40 ahead of 46.38
Retail Sentiment: Neutral
Trading Take-away: Neutral