The big move was the oil price overnight with Non-OPEC nations agreeing a cut of around 600k barrels per day. We will see if they can all play ball but it has certainly given the oil price a fill-up. As a result, the USDCAD fx pair has traded lower and we will see if the Loonie can hold onto its gains.
Dean's Daily FX Update – 12 December 2016
In the Zone
- EURUSD
- USDCAD
- USDJPY
Noteworthy News
- President Elect Donald Trump continues to make headlines in the lead up to his inauguration, this time questioning the credibility of the CIA. There is a fine line between rebelling against institution and making headlines and I don’t think Trump fully grasps the affect his words as President can have. This could get messy.
Recap
Much of the weekend was dominated by the non-OPEC meeting, a favourable outcome such as the OPEC meeting was anticipated and they didn’t disappoint. Production freezes and cuts were included in the deal and this led to a gap open on Sunday evening in both the oil price and USDCAD – something that we were expecting.
This was the catalyst for a big gap open in the USDCAD, it was not as pronounced as the oil prices but substantial none the less. The focus going forward will be if these agreements are respected or if we have a little game of “liar’s poker.” The CAD has made a deep move the last 2 weeks and I will be looking for some opportunity between 1.3110 – 1.3078 for a bounce.
The EURUSD was also under a little pressure as Italian Banks creating negative headlines over the weekend. This pressure translated in some early morning softness in the EUR and a look at 1.0520, it was encouraging that the pair found some support at these levels and bounced to 1.0560. It has stabilized at these levels for now but the EUR will want to see some continuation of this bounce in the London session, if not the bears could create some chaos this afternoon.
Everything else is a little subdued this morning with the GBPUSD, AUDUSD and NZDUSD all hardly changed. We discussed over the weekend the tight ranges that the commodity pairs were forming and we have something similar in the gold price. I will be sitting these pairs out until we have a defined break out of the range.
We have event risk in the form of the FOMC on Wednesday and the BOE on Thursday and we might see liquidity start to dry up somewhat this week. We will obviously have some opportunity but consider where your exit prices will be before you enter any trades.
Daily Ranges 12/12/2016
Majors
EURUSD
Resistance 1.0600 – 1.0628
Support 1.0538 – 1.0505
GBPUSD
Resistance 1.2610 – 1.2635
Support 1.2560 – 1.2540
AUDUSD
Resistance 0.7475 – 0.7490
Support 0.7440 – 0.7420
NZDUSD
Resistance 0.7184 – 0.7200
Support 0.7145 – 0.7130
USDCAD
Resistance 1.3180 – 1.3200
Support 1.3120 – 1.3100
USDJPY
Resistance 115.68 – 115.90
Support 114.77 – 114.48
USDCHF
Resistance 1.0197 – 1.0208
Support 1.0145 – 1.0130
Rand
USDZAR
Resistance 13.8000 – 13.8700
Support 13.6330 – 13.5810
EURZAR
Resistance 14.6138 – 14.6662
Support 14.4832 – 14.4475
GBPZAR
Resistance 17.4108 – 17.4805
Support 17.1902 – 17.1045
Minors
AUDCAD
Resistance 0.9834 – 0.9848
Support 0.9780 – 0.9750
AUDJPY
Resistance 86.20 – 86.52
Support 85.51 – 85.44
EURCHF
Resistance 1.0770 – 1.0792
Support 1.0745 – 1.0720
EURGBP
Resistance 0.8450 – 0.8470
Support 0.8374 – 0.8350
EURJPY
Resistance 121.82 – 122.31
Support 121.80 – 120.96
GBPJPY
Resistance 145.52 – 145.60
Support 144.79 – 144.63
GBPCAD
Resistance 1.6633 – 1.6646
Support 1.6533 – 1.6504
GBPCHF
Resistance 1.2833 – 1.2850
Support 1.2740 – 1.2715
CADCHF
Resistance 0.7762 – 0.7781
Support 0.7710 – 0.7682
Indices
DE30
Resistance 11230 – 11270
Support 11035 – 10980
UK100
Resistance 6980 – 7000
Support 6870 – 6841
US500
Resistance 2260 – 2275
Support 2245 – 2225
US30
Resistance 19800 – 19900
Support 19600 – 19500
SA40
Resistance 44338 – 44600
Support 43300 – 43100
Commodities
BRENT
Resistance 56.58 – 57.20
Support 54.16 – 53.70
XAUUSD
Resistance 1170.00 – 1173.20
Support 1158.74 – 1154.00
XAGUSD
Resistance 17.19 – 17.30
Support 16.84 – 16.73
Important Economic Data out today
- NONE
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