Monday November 22nd, 2021

The US$ is up and oil is flat, equity markets higher and US yields are up as we enter a US shorten week due to the US Thanksgiving holiday. The US dollar remains firmer on the session, tracking the rebound in the Treasury yields across the curve. Market awaits FOMC minutes amid a quiet start to the week. In other news, China ‘fired missile from hypersonic weapon’ over South China Sea. COVID, World Health Organization is worried about the surge in Europe as cases soars to record level. Austria plans compulsory Covid vaccination for all, while Germany debates it. Huge protests across Europe over new restrictions. In currency markets, Australia, NZ dollars are steady amid cautious tone in markets. China sets stage for easier monetary policy as central bank deletes language from new report.

The C$ continues to be influenced by the sentiment around the US dollar, oil prices and COVID-19 news. With limited economic news today, expect the C$ to trade in a narrow range. Support remains at 1.2580, while resistance holds at 1.2670.

EUR/USD is seeing some fresh selling pressure at market open. Support holds 1.1262, if breached look for 1.1162 (Jun2020) while resistance holds at 1.1370.

The Euro remains under pressure as Europe deals with a surge in COVID cases restraining any significant move higher in EURGBP. Support resets to .8354 (1.1970) while resistance lowers to .8480 (1.1792)Support resets to .8354 (1.1970) while resistance lowers to .8480 (1.1792)

GBP/USD attempts a bounce, but firmer USD has capped the upside. EU calls on Brexit minister to stop ‘political posturing’ over Northern Ireland protocol. Market digest BOE’s Bailey comments that inflation could be “elevated for longer” but there is also a chance that it does not prove as persistent as feared. Support drops to 1.3400 while resistance resets to 1.3490.