Monday November 9th, 2020

Risk on sentiment increases on vaccine news. In a vaccine breaking news today, Pfizer says COVID-19 vaccine 90% effective in a large study. Equity, currency and oil markets rally on the vaccine news. Still in play, Biden is win’s the US Presidency; US President Trump is yet to concede and is expected to start his legal challenge. President elect Biden said he will convene a coronavirus task force as global virus cases surpass 50mio and US cases nears 10mio. CNY up 0.4%, slightly off its 28-month highs, Asian currencies are up 0.4% on average vs US$. Trading currencies remain volatile with JPY down 0.5%, while ZAR & NOK are up 1%, AUD & NZD up 0.7%, MXN rallies up 1.4%. With no key economic data releases today, US elections next steps & vaccine updates will likely dictate intraday direction.

Oil prices leap 8% on Pfizer vaccine news. C$ breaks 1.2990 key support on the Vaccine news, as oil prices extended 6% on the vaccine announcement. Markets will focus on follow up vaccine updates, rollout prospects and expectations to complete the vaccine approval process. Intraday Support at 1.2952 (Jan10th) if breached then 1.2778 (Oct2018) with resistance at 1.3100.

Eur holds near the 1.1880 level retreating from its highs despite the vaccine news. The ECB President will be speaking today and will likely focus on the rising coronavirus cases, the economic impact from lockdowns and the ECB’s response. US election uncertainties will continue to have an impact on Euro as we await US Presidents next steps on the election results. No key economic data out today so focus will remain on the ECB president speech and vaccine updates. Support at 1.1710 with resistance at 1.1880 (pivot), a clean break looks for 1.2011 (Sep1st).

GBP found support from the vaccine news rallying 60 basis points. The Biden win is expected to put pressure on the UK to secure a Brexit deal. The President elect commented previously that if the UK PM endangered the Good Friday Deal in NI, it would impact a US/UK trade agreement. UK PM and EU Commission President spoke over the weekend and both sides expect to reach a possible deal by November 15th. The positive virus news will also provide support to GBP as the UK is the hardest hit country in Europe from the coronavirus. Also on the docket BoE  baily is expected to speak. Support at 1.2940 with resistance at 1.3177 (sep21st), if breached look for possible extension to 1.3482 (Sep1st).