Consolidative Moment As Markets Wait For Fresh Developments

Today is known in US election circles as safe harbor day.  All of the disputes on the state level must be resolved. This makes possible next Monday's meetings when each state's electors vote. All of the electors' votes must be received by December 23. The electoral votes are counted by Congress on January 6.  As Biden nominates his top advisers, note what happens at the Fed. Powell's term as chair is up in early 2022. Ostensibly, he could remain a governor until 2028. Clarida's position is a bit more complicated. His term as governor ends in early 2022, but his term as Vice-Chair does not end until September 2022.  Quarles's term as Vice Chair of supervision ends next October, but he could remain a governor until early 2032. There is also the governor seat that Trump had nominated Sheldon that remains vacant. The takeaway is that the political drama is nearly over and that Biden will have a chance to remake the Fed if so inclined.  

The North American economic calendar was light today, ahead of tomorrow's Bank of Canada and Brazil Central Bank meetings. The US dollar has edged to a new two-year low against the Canadian dollar today, just below CAD1.2770.  While there may be support around CAD1.2740, strong chart support is not seen until closer to CAD1.2500.  Initial resistance is seen in the CAD1.2800-CAD1.2820 area. The dollar has been confined to yesterday's range against the Mexican peso (~MXN19.7665-MXN19.9785).  A close above MXN19.92, the week-old downtrend line, would suggest additional near-term consolidative that could see the dollar push back above MXN20.00.  Last week's high was in the MXN20.21-area. 

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Read more by Marc on his site Marc to Market.

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