New York Forex Report: Markets Mute Heading Into Middle Of Week

Risk sentiment was impaired over early European trading following the overnight announcement of Chinese CPI which undershot expectations of 1.5% to print 1.3% with PPI falling just shy of 6%, renewing concerns over the world’s second largest economy and leading both equities and commodities lower on the session. Meanwhile, the US Dollar consolidates just off Friday’s highs whilst the Euro is weaker following comments yesterday that the ECB is converging on a deposit rate cut in December.

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

Fundamental: EUR extends losses from yesterday’s news that the ECB are converging on a December deposit rate cut and could possibly consider a cut larger than 0.1%. US Wholsesale inventories at 1500 GMT is the main news over the American session, expected o% from 0.1% previous.

Technical: While 1.0830/50 caps intraday upside corrections, bears target a break of Friday’s lows en route to a test 1.0560 next ahead of an assault on year to date lows. Only a close above 1.09 eases immediate downside pressure.

Interbank Flows: Bids 1.07 stops below. Offers 1.0830 Stops above.
Retail Sentiment: Bullish
Trading Take-away: Sell against 1.0830/50 resistance targeting 1.0560

eu2015-11-10 08_06_24-NetDania - NetStation

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

Fundamental: GBP was very constrained over the European morning, consolidating post-BOE & post-NFP losses amidst an absence of key domestic data. Traders look ahead to tomorrow’s UK earnings and unemployment data which have been very positive recently.

Technical:  While 1.5150 contains upside reactions expect a test of of bids at 1.50 as the next bearish objective. Only a close above 1.52 eases immediate bearish bias

Interbank Flows: Bids 1.50 stops below. Offers 1.52 stops above
Retail Sentiment: Bullish
Trading Take-away: Sell against 1.51 resistance targeting a 1.50 test

gu2015-11-10 08_06_52-NetDania - NetStation

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

Fundamental: USDJPY remains near highs. JPY safe-haven strength following the Chinese CPI miss has kept rate capped over the European morning whilst USD pauses near last week’s highs.

Technical: Upside objective of the primary equality objective at 123.50 essentially achieved, while 122.50 supports downside reactions, market structure remains bullish to test 2015 highs next

Interbank Flows: Bids 122.50 stops below. Offers 124 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

uj2015-11-10 08_07_21-NetDania - NetStation

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

Fundamental: EURJPY was lower over the European morning with EUR weakness and JPY strength clearly present. Further China data much later today could spur further JPY safe-haven demand.

Technical:  Bears now target equality corrective objective at 131.20, only a close above 133.50 eases immediate bearish pressure.

Interbank Flows: Bids 131.00 stops below. Offers 133.50 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

ey2015-11-10 08_07_47-NetDania - NetStation

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

Fundamental: Despite the impaired risk sentiment we’ve seen in the wake of poor China CPI data, AUDUSD has managed to remain lightly bid over the European morning. Westpac consumer confidence data is out later today.

Technical: While .7100 caps corrective upside reactions expect a retest and breach of Friday’s lows as bearish momentum builds for a retest of year to date lows.

Interbank Flows: Bids .7000 stops below. Offers .7100 stops above
Retail Sentiment: Bullish
Trading Take-away: Squared shorts into .7030 target, sidelines for now

au2015-11-10 08_08_19-NetDania - NetStation

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

Fundamental: USDCAD remained firmly range-bound over the European morning as markets are fairly quiet with USD pausing at highs and Oil flat.

Technical: Offers just above 1.33 stall the upside ratchet, bulls have the ball while 1.3260 supports intraday downside. However a close below 1.3260 today would suggest a false upside break and a bull trap sustained weakness below 1.3220 confirms.

Interbank Flows: Bids 1.3250 stops below. Offers 1.3350 stops above
Retail Sentiment: Bearish
Trading Take-away: Sidelines for now

uc2015-11-10 08_08_45-NetDania - NetStation

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