Overnight Range 1.3307-1.3415
The FBI concluded (again) that Hillary Clinton should not face criminal charges and FX markets concluded that they should buy US dollars.
“Based on our review, we have not changed our conclusions that we expressed in July with respect to Secretary Clinton,” Comey wrote Sunday, in a letter sent to members of Congress and released by Rep. Adam Schiff (D-California).- From CBS News
EURUSD gapped lower in very early trading in Asia, falling from 1.1130 to 1.1040. USDJPY soared, rising from 103.40 to 104.62 in Europe.
The commodity bloc currencies dropped, popped and dropped again in a volatile session.
China reported that FX reserves declined by $45.7 billion to $3.12 trillion in October, which was very close to forecasts. Some analysts speculate that the reserve decline was due to currency stabilization measures.
In Europe, the Italian Central Bank (Banca D’Italia) reportedly said that the ECB is not talking about an early end to QE, but extending it. Data-wise, Eurozone Retail Sales declined 0.2% in September, slightly better than the 0.3% decline that was expected. EURUSD did not react to the data or the news.
Sterling is back under pressure. GBPUSD closed at 1.2513 on Friday, dealt as low as 1.2383 and is currently trading at 1.2430,
WTI oil prices rebounded, rising from a low of $44.39 to $44.96, before drifting back to $44.70 as of 7:30 am EST. That move is on the back of comments by the Opec Secretary General, Mohammed Barkindo, who said “We as OPEC we remain committed to the Algiers accord that we… put together. All OPEC 14 we remain committed to the implementation.“
Global equity indices rallied on the Clinton story, led by a 1.61% gain in Japan’s Nikkei 225 index. US equity futures are poised to open higher as well.
Today and tomorrow will be writ-offs as far as FX activity goes. There isn’t any meaningful Canadian or US economic data leaving US election polls and headlines to provide direction. Nothing is likely to change until the election results are known.
USDCAD technical outlook
The 1.3300-1.3460 range seen since will likely contain USDCAD moves until Wednesday. The intraday uptrend from Oct 21 remains intact while prices are above 1.3330. For today, a move below 1.3370 should lead to a retest of the overnight low while a break of 1.3420 will lead to 1.3460.
Today’s Range 1.3320-1.3420
Chart: USDCAD 1 hour