Dean is looking to play the USDCAD from the short side this morning. He is also looking at the AUDUSD from a long perspective and both these FX pairs are at big support and resistance levels. There is the risk that no deal happens within OPEC so the USDCAD Forex pair could be exposed to more upside.
Dean's Daily FX Update – 31 October 2016
In the Zone
- AUDUSD
- USDCAD
Noteworthy News
- Conflicting reports over the future of BOE Governor Carney surfaced this weekend and are bound to cause a little caution this morning. Some reports stating he is to resign whilst others are suggesting he will serve his 8 year term. This could create a little bit of choppy trade this morning.
Recap
Reports over the weekend that BOE Governor Carney was to resign was the catalyst for the GBPUSD to trade lower first thing this morning, this would naturally raise concern of future policy direction in what is an already fragile economy. Subsequent headlines out of the Financial Times that Carney will see out his term seems to have eased the nerves a little bit. The GBPUSD gapped lower but seems to have found some support at 1.2200. This could be a window to see how market reacts this morning, one to sit on the side-lines for me.
This also had an effect on the USDJPY, there was that initial “flight to safety” as the pair dropped down to 104.20, it has since staged a small recovery just as cable did. It has not quite tested that 105.00 level just yet, but that would be my pivot to start the week.
USDNZD, AUDUSD and USDCAD have not had any material move in Asia. I have covered the AUDUSD and USDCAD more in the video this morning. On the local front we have Pravin Gordhan to face his allegations this week, there are even rumours that charges have already been dropped – either way the USDZAR has been impressive in the last week and it could continue if there are no further fires to put out.
The US faces its own political scandal (who says only in South Africa), as the FBI have secured a warrant to search the emails of Hillary Clinton, this could weaken the USD a little bit as we enter the last week before the US hit the polls.
Please also bear in mind that both Europe and the UK have set their clocks back an hour and so there will be a later start to trading.
Daily FX Ranges
EURUSD
Resistance 1.0950 – 1.0990
Support 1.0920 – 1.0900
GBPUSD
Resistance 1.2245 – 1.2277
Support 1.2147 – 1.2130
AUDUSD
Resistance 0.7633 – 0.7648
Support 0.7573 – 0.7550
NZDUSD
Resistance 0.7190 – 0.7205
Support 0.7111 – 0.7100
USDCAD
Resistance 1.3418 – 1.3435
Support 1.3365 – 1.3330
USDJPY
Resistance 105.15 – 105.31
Support 104.80 – 104.50
USDCHF
Resistance 0.9915 – 0.9930
Support 0.9870 – 0.9850
USDZAR
Resistance 13.8615 – 13.9174
Support 13.7120 – 13.6725
Important Economic Data out today
- NONE
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