New York Forex Report: UK Wages Growth Boosts Sterling

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

Fundamental: EURUSD softened back into yesterday’s range following initial strength over early European trading. EuroZone industrial production figures, which were expected to show an increase, missed starkly with a print of 0.9% vs the expected 1.8% extending data weakness from yesterday’s German ZEW miss.  Looking ahead at the American session traders will be watching US Retail Sales expected unchanged at 0.2% followed by the release of the Fed’s Beige Book at 1800GMT1.

Technical: price is pressuring 1.14 offers, while 1.1340/60 supports intraday downside reaction bulls now targets 1.1460 as the next upside objective.

Interbank Flows: Bids 1.1330/50 stops below. Offers 1.1460 Stops above.
Retail Sentiment: Bearish
Trading Take-away: Stay long for 1.15

eu2015-10-14 07_37_51-NetDania - NetStation

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

Fundamental: Another volatile European morning for Sterling which reversed sharply from yesterday’s lows ahead of key data. UK unemployment fell to 5.4%, marking a seven year low, whilst average weekly earning showed a further increase from last month’s 2.9% to 3% this month which saw GBPUSD trading back up into yesterday’s highs.

Technical: Reversal from 1.52 puts pressure on offers approaching 1.54 with 1.53 now returning as intra-day support.

Interbank Flows: Bids 1.52 stops below. Offers 1.54 stops above
Retail Sentiment: Bearish to neutral
Trading Take-away: Sidelines for now

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

Fundamental: JPY flows currently caught between market expectations of further BOJ easing and a reduction in risk sentiment following the drop in Chinese CPI to 1.6% from 2.0% previous.

Technical: Continues to coil in contracting range, play range 121.50 the offer and 118.50 the bid until broken.

Interbank Flows: Bids 118.50/30 stops below. Offers 121.50 stops above
Retail Sentiment: Neutral to bullish
Trading Take-away: Sidelines for now

uj2015-10-14 07_39_07-NetDania - NetStation

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

Fundamental: Weighed yesterday by softer equities, but still holding in upper end of recent range due to positive EUR cross flows.

Technical:  The close above 136 opens a retest of upper end of the recent range and a retest of offers at 137 next. Remain bullish while 135.80/136 supports intraday downside reactions.

Interbank Flows: Bids 135.80 stops below. Offers 137 stops above
Retail Sentiment: Neutral to bearish
Trading Take-away: Sidelines for now

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

Fundamental: The Aussie weakened over European trading as traders pared back risk following the drop in Chinese CPI overnight following on from weak Chinese import data which has seen commodities weaken.

Technical: Breach of .7300 support turns near term sentiment neutral. While .7300 caps intraday upside reactions expect another corrective leg to target pivotal .7040 symmetry support. A breach of .7300 targets a retest of .7400 offers.

Interbank Flows: Bids .7200 stops below. Offers .7400 stops above
Retail Sentiment: Bearish to neutral
Trading Take-away: Sidelines for now

au2015-10-14 07_57_11-NetDania - NetStation

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

Fundamental: The Loonie remained range-bound over the European morning with Oil prices slightly weaker heading into the New York open.

Technical: Near term bearish tend remains intact as intraday resistance at 1.3060 contains intraday upside reactions bears target 1.2850 bids as the next downside objective. A breach of 1.3080 opens test of 1.3130/50 offers next.

Interbank Flows: Bids 1.2890 stops below. Offers 1.3060 stops above
Retail Sentiment: Bullish
Trading Take-away: Sidelines for nowuc2015-10-14 07_58_58-NetDania - NetStation

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