New York Forex Report: Sterling Sold Sub 1.30

New York Forex Report: Sterling Sold Sub 1.30

New York Forex Report: GBP has been under pressure during the European session as it broke back below 1.30 overnight the catalyst for the move was comments from BoE ‘s McCafferty suggesting rates closer to 0% were likely appropriate for post Brexit Britain, especially if UK data continues to weaken. The Euro continues to hold levels just below 1.11 as the USD Index holds a meagre 0.04% gain on the day as most markets continue to experience reduced volatility in slow summer price action.

FX Majors: EUR had little change on Monday after the sharp US employment numbers Friday pushed the pair dropping below 1.1100. German industrial production rose 0.8% month over month in June, beating the consensus forecast of 0.7%, even before taking into account that the decline in May was revised to 0.9% from 1.3%. The sharp rise in German industrial production in June merely reversed much of the decline posted in May, as demand for capital goods bounced back GBP fell for a fourth day against the US dollar, its longest losing streak since the Brexit vote amid the Bank of England started its expanded monetary easing program on Monday. As well as cutting interest rates for the first time since 2009, the BoE exceeded market expectations in its 4 August policy announcement by increasing its gilt-purchase program by 60 billion pounds to 435 billion pounds, starting from Monday. The central bank is boosting the money supply, which tends to weaken a currency, in order to reinvigorate Britain’s economy in the wake of the 23 June vote to leave the European Union. JPY rosier economic assessment by Eco Watchers on both current conditions and outlook was offset by halving in the current account surplus as a result of sharply lower investment income in Jun. A summary of the BOJ meeting held in end-July revealed divergence among BOJ board members with some in favour of unlimited easing monetary policy while some opine monetary policy easing has its limit and side effects.

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

Technical: 1.1090 downside objective achieved, while 1.1040 supports there is potential for a near term base to target 1.1330. Failure below 1.1030 opens 1.0950 on the downside.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: 1.2950 equidistant swing objective firmly in bear sites. !.3020 is near term resistance with 1.31 the medium term upside hurdle.
Retail Sentiment: Bullish
Trading Take-away: Short

USDJPY
Outlook: Short Term (1-3 Days): Neutral – 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 102.80, over 102.90 targets 103.50 next.
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: The breach of 113 opens 110.80 as the next downside objective. Near term resistance is sited at 113.90
Retail Sentiment: Bullish
Trading Take-away: Short

Commodities FX: GOLD struggled to keep its head above water as Friday’s strong jobs report in the US kept investors on the sidelines. Prior to this, investor demand was strong, with ETF holdings climbing 8.32 tonnes to 2,039.5 tonnes on Friday. Oil settled higher yesterday amid renewed speculation that OPEC would try to control output, easing oversupply concerns. At the same time, China’s fuel exports rose to a record in July, which surged 52.3 percent from a year ago to a monthly record 4.57 million tonnes. AUD held recent gains yesterday, staying near a three-week high as investors trying to escape negative interest rates in Europe and Japan. CAD was relatively stable followed steep losses on last Friday as a slump in domestic jobs and a record-wide trade deficit.

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

Technical: Range resistance at .7676 under pressure with near term support now at .7570, a close over .77 will shift attention to broader range resistance sited at .7830
Retail Sentiment: Bearish
Trading Take-away: Long

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

Technical: Sharp reversal ahead of 1.2965 symmetry swing support sets bullish sites on the upside equidistant swing target of 1.3380. Failure below 1.2950 opens 1.2860 as the next downside objective.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Bulls target 1391 as the next upside objective, near term support is sited at 1330. Below 1300 opens 1270
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Breach of bids at 41.87 opens 38.19 as the next downside objective, expect symmetry swing resistance sited at 43.28/96 to stall the corrective advance, a close over 44.40 is required to ease bearish pressure.
Retail Sentiment: Bearish
Trading Take-away: Long