America rally: dollar companies ahead of Fed policy meeting, Wall Street ends higher, gold prices fall, oil mixed with choppy trading ahead of US stocks, OPEC + meeting of November 3, 2021


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Market overview

• Building permit Canada Sep (MoM) 4.3%, 3.1% forecast, -2.1% previous

• US Red Book (YoY) 16.9%, 15.6% previous

• French 12 month BTF auctions -0.651%, previous -0.636%

• French auctions BTF 3 months -0.772%, previous -0.736%

• French auctions BTF 6 months -0.684%, previous -0.685%

• US economic optimism IBD / TIPP 43.9 46.8 previous

• New Zealand Dairy World Trade Price Index 4.3%, previous 2.2%

Future Outlook Economic Data (GMT)

• 06:00 Australia Sep Building Approvals (MoM) -2.0% forecast, 6.8% previous

• 06:00 Australia Sep Private home approvals 3.5% previous

Future prospects – Events, other versions (GMT)

• 03:30 New Zealand RBNZ Gov Orr Speaks

Currency Summaries

EUR / USD: The euro fell on Tuesday as the dollar strengthened as the US Federal Reserve kicked off its two-day policy meeting in which it was scheduled to announce it would start cutting back its massive purchases of assets put in place at the start of the COVID-19 pandemic. In recent weeks, investors have been anticipating a wave of central bank tightening as they are betting policymakers are concerned enough about rising inflation to end pandemic-era easing levels. . The dollar index, which measures the greenback against a basket of comparable currencies, rose 0.19% to 94.106. Immediate resistance can be seen at 1.1589 (38.2% fib), a bullish breakout can trigger a rise towards 1.1611 (9DMA). (Lower BB).

GBP / USD: The pound fell slightly on Tuesday, hovering around a three-week low, under pressure from uncertainty over whether the Bank of England will hike interest rates this week. BoE Governor Andrew Bailey spoke of the need to act to contain inflation expectations, with two of the other nine members of the Monetary Policy Committee expressing similar concerns. Meanwhile, two MPC members say there is little they can do to address the root cause of the acceleration in prices: the bottlenecks caused by the reopening of the global economy that could blend quickly. The British pound slipped 0.4% against the dollar to $ 1.3611 at 6:10 p.m. GMT, hitting a three-week low. Immediate resistance can be seen at 1.3639 (38.2% fib), a bullish breakout can trigger a rise towards 1.3667 (5 DMA). 1.3547 (lower BB).

USD / CAD: The Canadian dollar weakened to its lowest level in nearly a week against its US counterpart on Tuesday, as oil prices fell and investors became cautious ahead of an expected cut in policy measures. Federal Reserve economic stimulus. The price of oil, one of Canada’s top exports, fell 0.2% to $ 83.91 a barrel ahead of weekly U.S. supply reports that are expected to show increased crude inventories. The loonie was trading down 0.3% to 1.2403 versus the greenback, having hit its lowest level since last Wednesday at 1.2424. In October, the currency was up 2.3%, its biggest gain since last November. Immediate resistance can be seen at 1.2432 (50% fib), a bullish breakout can trigger a rise towards 1.2480 (61.8% fib). On the downside, immediate support is seen at 1.2377 (38.2% fib), a break below could take the pair towards 1.2311 (23.6% fib).

USD / JPY: The dollar edged up against the Japanese yen on Tuesday as the Fed kicked off its two-day policy meeting in which it was to announce that it would start cutting back on its massive purchases of established assets at the start of the COVID-19 pandemic. The Fed will issue a statement at the end of its two-day meeting on Wednesday, when it is expected to announce the start of the cut to its bond buying program. Markets are also forecasting a hike in interest rates at the Bank of England meeting on Thursday. The US dollar index, which tracks the greenback against a basket of six currencies, rose 0.181% even as the market fully incorporated a Fed cut announcement. Strong resistance can be seen at 114.29 (23.6% fib), a bullish breakout can trigger up to 115.05 (lower BB). On the downside immediate support is seen at 113.78 (38.2% fib), a break below could take the pair towards 113.36 (50% fib).

Summary of actions

European stocks hit an all-time high on Tuesday as strong outlook for hearing aid maker Demant supported health care stocks, although the wider gains were stifled by losses in minors and the prospect of large meetings of the central bank.

The British benchmark FTSE 100 closed down 0.19%, the German Dax ended down 0.94%, the French CAC ended the day up 0.49%.

Major Wall Street indices rose to record highs on Tuesday as a strong earnings season continued to bolster sentiment for equities, as investors eagerly awaited the results of a critical Federal Reserve meeting .

The Dow Jones closed up 0.39 %%, the S&P 500 0.37 %% and the Nasdaq 0.34 %%.

Summary of treasury bills

U.S. Treasury yields fell and the curve steepened on Tuesday as the market waited for a likely Federal Reserve announcement that it would start cutting asset purchases, while hoping for clues to seemingly persistent inflation and future interest rate hikes.

The benchmark 10-year yield lost 2.6 basis points for the last time to 1.547%.

Summary of commodities

Gold prices fell on Tuesday as the US dollar and stocks appreciated ahead of a much-anticipated US Federal Reserve meeting that could provide a timeline for interest rate hikes amid mounting inflationary pressures .

Spot gold was down 0.3% at $ 1,787.04 an ounce at 1:35 p.m. EDT (5:35 p.m. GMT). US gold futures fell 0.4% to $ 1,789.40.

Oil traded below $ 85 a barrel on Tuesday, but remained near a three-year high in choppy trading ahead of weekly U.S. supply reports which are expected to show an increase in crude inventories, the traders also looking to Thursday’s OPEC + meeting.

U.S. West Texas Intermediate (WTI) crude fell 14 cents, or 0.2%, to $ 83.91. Previously, it had fallen more than $ 1 a barrel. Brent crude rose 1 cent to $ 84.72 a barrel, trading negatively for much of the session.

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