New York Forex Report: Profit Taking Pause To Refresh King Dollar

New York Forex Report: Profit Taking Pause To Refresh King Dollar

New York Forex Report: The USD is lower against most major currencies on the day as the rally that developed around the US presidential election stalls.As noted in recent reports, runs of consecutive higher daily closes rarely extend much beyond the low double digit range before a pause sets in. After ten days of a rising USD and with the US Thanksgiving holiday looming, now is a convenient excuse to book some profits on USD longs. That is not to say that the USD rally is over, however; expect USD dips to remain fairly shallow and for the USD rally to resume well into December when policy divergence (Fed tightening and perhaps clearer indications of additional easing from the ECB) will become starker. Note that futures are factoring in less than 50% risk that the Fed funds target rate will reach 1% over the next 12 months. The USD rally has room to extend if the Fed maintains a relatively constructive view of prospects at the December meeting.

FX Majors: EUR snaps it’s ten day losing streak. European Central Bank President Mario Draghi told European Parliament in Strasbourg that the return of inflation toward our objective still relies on the continuation of the current, unprecedented level of monetary support, in spite of the gradual closing of the output gap. GBP broke above the 1.25 barrier after assurances from the Prime Minister Theresa May that businesses would not be left teetering on a Brexit “cliff edge”. The currency also gained some uplift from the PM’s aim to keep UK corporation tax lower than its international rivals. JPY Japan’s all industry activity index rose at unchanged pace of 0.20% MOM in September. The construction sector expanded at quicker pace, offsetting contraction in the services sector. Meanwhile, industrial production grew at a slower pace in September.

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

Technical: Bears have the ball the breach of 1.07 shifts bearish attention towards 2015 lows at 1.05. Near term resistance is sited at 1.07, medium term 1.0850 is a key upside hurdle which will need to be captured on a closing basis to stabilise the pair.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Bears target symmetry swing objective at 1.2270 as 1.2510 contains upside reactions, over 1.2520 opens a retest of 1.2580 ahead of 1.2670

Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Bulls achieve 1.11 pivot, while 1.0960 supports 1.1242 becomes the next upside objective representing the 50% retracement of the 2015/16 decline. Below 1.0830 opens 1.0740, only below 105.50 concerns bulls
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: 116.20 primary upside objective achieved, this level now becomes near term support.The top side expansion through 117 opens 121.41 equidistant swing objective. A break back below 116 opens 115.30, only close below 114.60 questions bullish thesis
Retail Sentiment: Bearish
Trading Take-away: Long

Commodities FX: GOLD rose, rebounding from 5-1/2 month lows as the dollar shed some of the hefty gains made the previous week on bets that US president-elect Donald Trump’s plans for fiscal stimulus would prove inflationary. OIL prices were higher as a result of renewed optimism that OPEC could agree on a production cut after Russian President Vladimir Putin reportedly commented that there are few hurdles for the producer cartel to clear in order to reach a deal. AUD stayed on the defensive yesterday as increasing Treasury yields and the prospect of a December rate hike in the United States boosted the USD. AUD decline will be welcomed by the Reserve Bank of Australia (RBA) as it should bolster the country’s terms of trade, reducing the need to cut official interest rates again CAD gained against the USD as a rally in oil eclipsed weaker-than-expected domestic wholesale trade figures.

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

Technical: The breach of 7412 symmetry support now opens .7092 AB=CD. as the next downside objective. Near term resistance is sited at .7440 ahead of pivotal 7530
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: 1.3573 achieved expect some profit taking pullback is testing symmetry support at 1.3407, as this area contains the pullback 1.3620 becomes the next upside objective. Only a close below 1.3250 concerns the bullish bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Bears achieve the targeted equidistant swing objective sited at 1203, near term resistance is sited at 1223 as this level contains 1190 is the next downside objective. Only a close over 1240 stabilises the decline..
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: Offers emerge at 48.92 equidistant swing resistance as this level contains upside reaction opportunity for a move to the downside targeting symmetry swing objective at 39.78. A breach of 49.00 opens a quick test of offers above 50.00 .
Retail Sentiment: Bearish
Trading Take-away: Long