New York Forex Report: USD Marches on

New York Forex Report: USD Marches on

New York Forex Report: Fed rhetoric continues to be hawkish, spurring expectations the Fed is paving the way for a June rate hike. Fed Williams said the Fed is on track to raise rates in June or July despite Brexit risks. He reinforced the view both within the US central bank and in financial markets that overseas risks, even the Brexit vote he said would loom over next month’s decision, are not severe enough to delay rate hikes much longer. Meanwhile, Fed Bullard said extended period of low rates could cause financial instability in future, and stronger market expectations for a rate rise are “probably good”. PMI manufacturing in the US staged a surprised pullback to 50.5 in May while that of the Eurozone pulled back somewhat to 51.5, against expectations for a rise to 51.9. On a less downbeat note, PMI services managed to sustain at 53.1 based on May preliminary reading. USD Index retreated somewhat by 0.11% to 95.23 after paring earlier gains going into US trading session after the release of disappointing PMI manufacturing data.

FX Majors: A quiet session for the majors over the European morning with little in the way of key data. German 1Q GDP came out in line with expectations followed by a set of mixed ZEW surveys. UK Public Sector Net Borrowing increased over April to 6.6b against expectations of 5.8b. In comments made in Parliament, BOE governor Carney defended the BOE’s warnings over the likely damage to the UK economy from Brexit.

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

Technical: Prior support at 1.1280 now becomes resistance while this area contains upside reactions, bears now target symmetry support at 1.1065, only over 1.1450 eases immediate downside bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: The second failure at 1.45 suggests further downside, as 1.4560 caps upside reactions expect a test of 1.44 next ahead of a retest of 1.4330
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Retest of offers at 110.60/90 see sellers emerge, the subsequent failure at 109.50 opens a move to retest bids back towards 107.50, a close over 111.90 eases immediate bearish bias.
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: Bears now target weekly symmetry objective at 120.60. Intraday resistance at 124.20 only a close above 126.80 eases immediate downside pressure.
Retail Sentiment: Bullish
Trading Take-away: Short

Commodities FX: Oil remains off highs over the European morning today as continued US Dollars trength weighs on prices. Signs that recent production outahes are coming to an end have also been weighing on price as concerns build once again regarding over-supply .

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

Technical: 7240/60 support erased now becomes intraday resistance as bears target .7050 as the next downside objective. Only a close over .7400 eases immediate downside pressure
Retail Sentiment: Bullish
Trading Take-away: Short

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

Technical: While 1.2960 supports bulls target offers at 1.3210 as the next upside extension target. Only a close below 1.2760 eases immediate bullish pressure.
Retail Sentiment: Bearish
Trading Take-away: Sidelines

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

Technical: 1288 is now resistance. The anticipated second leg of corrective price action is underway to test of the pivotal 1240, the medium term bullish bias would be questioned with a close below symmetry support at 1230
Retail Sentiment: Neutral
Trading Take-away: Neutral

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

Technical: As 46.70 supports 50.00 becomes the material upside objective, with a symmetry swing target sited at 50.51 ahead of the larger AB=CD swing objective at 51.09, only a close below 43.00 threatens bullish bias
Retail Sentiment: Bearish
Trading Take-away: Long