Yesterday’s focus was on the commodity currencies. Today Dean sees the possibility that they run out of some steam against the dollar. Trump and Hilary go head-to-head tonight for the last of the Presidential debates and then the US must choose … I pity them!
Dean's Daily FX Update – 19 October 2016
In the Zone
- AUDUSD
- NZDUSD
- USDZAR
Noteworthy News
- Chinese Data was relatively solid, with GDP coming in at 6.7%. News that the world’s second biggest economy is stable will come as a relief to developed economies, as a wobble in China would have an adverse effect on global growth.
- Finance Minister Gordhan rejected the NPA offer for review yesterday. He seems focused on delivering the Mid Term Budget Speech. He has received a lot of support from prominent members within his party in the last week, you just wonder if after delivering his speech the gloves are going to come off.
Recap
The day was characterised by another bout of dollar selling yesterday, USD bulls will take heart that selling seemed modest and despite sliding for most of the day was able to close at its best levels of the day. With Chinese data out of the way, the close last night may pave the way for a deeper dollar rally today.
GBPUSD staged yet another “strong” rally yesterday, inflation was strong and there is continued speculation of a compromise in Brexit negotiations. There is talk in the market that traders have found the bottom and that there will be more rallies in the coming weeks. I am still suspicious though, the GBPUSD rally has been relatively small compared to the larger trend and this week could just be a little bit of short covering as traders take some profits off the table. I am still sitting on the side lines in cable.
USDCAD seemed a little undecided yesterday. It had range bound oil prices driving it and we also may have seen some positioning ahead of a bumper economic calendar for the CAD today. I am hoping that we may see some opportunity present itself tomorrow for this pair.
Daily FX Ranges
EURUSD
Resistance 1.1000 – 1.1014
Support 1.0965 – 1.0900
GBPUSD
Resistance 1.2280 – 1.2300
Support 1.2207 – 1.2200
AUDUSD
Resistance 0.7679 – 0.7700
Support 0.7630 – 0.7600
NZDUSD
Resistance 0.7200 – 0.7230
Support 0.7159 – 0.7139
USDCAD
Resistance 1.3138 – 1.3167
Support 1.3079 – 1.3060
USDJPY
Resistance 104.00 – 104.15
Support 103.60 – 103.50
USDCHF
Resistance 0.9900 – 0.9915
Support 0.9873 – 0.9850
USDZAR
Resistance 14.2900 – 14.3600
Support 13.9100 – 13.7891
Important Economic Data out today
- 10:30 GBP Average Earnings Index
- 10:30 GBP Claimant Count Change
- 14:30 USD Building Permits
- 16:00 CAD BOC Monetary Policy
- 16:00 CAD BOC Rate Statement
- 16:00 CAD Overnight Rate
- 17:15 CAD BOC Press Statement
- 22:15 CAD BOC Governor Poloz Speaks
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