U.S. Session Forex Recap – Nov. 9, 2016

  • U.K. Supreme Court accepted Brexit appeal from gov’t
  • U.K. Supreme Court hearing on Dec. 5-8, ruling by January 2017
  • U.S. stock indices close higher in anticipation of Clinton victory

The Greenback was all over the place in the calm before the storm, as forex junkies were biting their nails while waiting for the results, while the comdolls enjoyed risk-on vibes.

Major Events:

U.S. markets hopeful for Clinton win – Wall Street closed higher for another day, indicating that investors are keeping their fingers crossed for the Hillz to win the U.S. elections. After all, this scenario would bring the least amount of uncertainty in the markets since it would ensure continuity with the incumbent political party.

The Dow 30 index was up 73.14 points to 18,332.74 (+0.40%), the S&P 500 index rose 8.01 points to 2,139.53 (+0.38%), and the Nasdaq closed 27.32 points to 5,139.49 (+0.53%). These are smaller gains compared to their 2% rebound on Monday, reflecting a bit of nervousness among market participants.

The action will heat up after the exit poll results start coming in, particularly from the swing states which have shown a neck-and-neck battle between Clinton and Trump, so better keep tabs on your dollar positions if you’re keeping ’em open!

U.K. Supreme Court to sit on Brexit – In other non-election news, the U.K. Supreme Court accepted the appeal from the British government to reconsider the need to get parliamentary approval before invoking Article 50. Recall that U.K. Prime Minister Theresa May set the date for officially getting the negotiation process started in March 2017, but the British High Court recently said “Not so fast!” in ruling that lawmakers have to give the thumbs-up first.

Now the Supreme Court hasn’t come up with a decision yet since they need to get their thinking caps on and convene from December 5-8, before giving their official ruling by January next year. If they rule against the need to get the parliament’s go signal for Article 50, the Brexit process could start much earlier instead of getting delayed in parliament limbo.

Major Market Movers:

GBP – Sterling was actually one of the biggest losers for the day as the U.K. Supreme Court’s acceptance of the government appeal could make Brexit happen sooner rather than later.

GBP/AUD tumbled from 1.6122 to 1.5900, GBP/NZD slipped from 1.6936 to 1.6713, GBP/CAD fell from 1.6586 to 1.6430, while GBP/USD struggled to stay above 1.6400 and GBP/JPY held on to 130.00.

Commodity Currencies – In contrast, the comdoll gang chalked up gains across the board as a bit of risk appetite came into play.

AUD/USD recovered from .7698 to a high of .7778, NZD/USD rallied from .7325 to .7403, USD/CAD broke lower from 1.3367 to 1.3300, AUD/JPY surged from 80.62 to 81.88, and EUR/AUD dropped from 1.4345 to 1.4200.

Watch Out For:

  • 1:30 am GMT: Chinese CPI y/y (2.1% expected, 1.9% previous)
  • 1:30 am GMT: Chinese PPI y/y (0.9% expected, 1.0% previous)
  • 5:00 am GMT: Japanese Economy Watchers Sentiment index
  • Tentative: U.S. election results

See also:

London Session Recap

Asian Session Recap

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