FX Morning Update November 2, 2011
USD/CAD Open: 1.0181-84 Overnight Range: 1.0137-1.0225
The Canadian dollar was volatile overnight as it made some gains vs. the USD. Yesterday, US mfg. data showed a minor expansion and US car sales grew at the fastest pace this year. Oil is at $93.23 and gold is at $1,732. NY futures are pointing higher today. Bernanke speaks today discussing the FOMC’s policy outlook and ADP jobs data is released today.
The short term Canadian dollar technicals are negative. For today, USD resistance is at 1.0213 and 1.0260. Support is at 1.0131, 1.0031, and 0.9980.
Shockwaves around Europe driven by Greece remains the theme. The necessity of a referendum is the key issue and an uncontrollable default remains the main risk. Finland indicated it won’t give any more funds than agreed to in the eurozone bailout. Despite economic data that has muddled along and looks to avoiding a recession, negative headlines from Europe continue to jolt markets. Look for the move towards the USD to continue if this drags on and look for the risk-off trade to end if Greece ends its referendum vote or somehow hints the eurozone bailout plan will pass. The market is eager to see if the FOMC will shift its outlook towards QEIII, which would boost equities and the loonie. The USD is caught between a flight to safety on the Greece issues and some abandonment if the FOMC hints at further quantitative easing.
Today’s Range: 1.0100 – 1.0240
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By Admin | November 2, 2011 | Daily Update | 0 comments