FX Morning Update November 1, 2011
USD/CAD Open: 1.0126-29 Overnight Range: 0.9974-1.0144
The Canadian dollar got clobbered overnight losing ground vs. the USD. Overnight, China reported weaker than expected mfg. PMI. Greece’s decision to hold a referendum on the eurozone bailout plan has caused a risk-off trade. Oil is at $90.72 and gold is at $1,692. NY futures are pointing lower today. The FOMC has a two day meeting starting today and ISM mfg. data is released today.
The short term Canadian dollar technicals are negative. For today, USD resistance is at 1.0131, 1.0213, and 1.0260. Support is at 1.0031, 0.9980, and 0.9920.
The focus is back on Greece as more uncertainty plagues the marketplace as Greek is going to vote on if they should accept the eurozone bailout plan. If Greece doesn’t accept the bailout plan, Greek may have to default and potentially exit the eurozone. This puts much of the widely publicized eurozone bailout plan announced last week in limbo and in the hands of the people of Greece. The market is concerned about uncontrollable contagion in the eurozone. Despite decent Q3 earnings results, the equity market is focused on the eurozone headlines. Look for a flight to safety towards the USD as those that built long CAD and equity positions may need to reverse them in a herd mentality as this Greek situation doesn’t look like its going to get resolved in the immediate future.
Today’s Range: 1.0050 – 1.0200
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By Admin | November 1, 2011 | Daily Update | 0 comments