America’s Roundup: Dollar jumps on Powell renomination, Wall Street retreats, Gold slides over 2%-November 23rd,2021

Posted at 23 November 2021 / Categories Market Roundups

Market Roundup

•Canada Wholesale Sales (MoM) 1.4%, 1.0% previous

•US Oct Chicago Fed National Activity  0.76,-0.13 previous

•French 6-Month BTF Auction -0.847%,-0.800% previous

•French 3-Month BTF Auction -0.959%,-0.863% previous

•French 12-Month BTF Auction -0.754% ,-0.754% previous

•EU Nov Consumer Confidence -6.8, -5.5 forecast, -4.8 previous

•US Oct Existing Home Sales (MoM)  0.8%,7.0% previous

•US Oct Existing Home Sales  6.34M,6.20M forecast, 6.29M previous

•US 3-Month Bill Auction 0.070%,0.045% previous

Looking Ahead Economic Data (GMT)

 •No data ahead

Looking Ahead - Events, Other Releases (GMT)

•No significant events

EUR/USD: The euro declined against dollar on Monday as growing concerns over the impact of new COVID-19 restrictions in Europe weighed on euro. Austria began its fourth lockdown, the first introduced since vaccines became widely available, shutting Christmas markets, bars, cafes and theatres. A fourth wave of infections has plunged Germany, Europe's largest economy, into a national emergency, Health Minister Jens Spahn said, warning that vaccinations alone will not cut case numbers. The euro slipped 0.25% to $1.1239 , close to a 16-month low touched on Friday. Immediate resistance can be seen at 1.1289(5DMA), an upside break can trigger rise towards 1.1301 (38.2%fib).On the downside, immediate support is seen at 1.1226 (23.6 % fib), a break below could take the pair towards 1.1200(Psychological level).

GBP/USD: The pound declined against the dollar on Monday as UK rate variability and rising COVID cases in Europe weighed on sterling. Traders' focus remains firmly on whether or not the Bank of England will raise interest rates at its December meeting. The BoE wrong-footed many investors earlier this month when it did not lift rates from their record low 0.1%, following comments from Bailey in late October which markets interpreted as a signal that a rate hike was very near. The pound against the dollar was a tad weaker at $1.3400 , off the $1.3354 low hit last week. Immediate resistance can be seen at 1.3453(5DMA), an upside break can trigger rise towards 1.3481(38.2%fib).On the downside, immediate support is seen at 1.3395 (23.6%fib), a break below could take the pair towards 1.3353 (12th Nov low).

USD/CAD: The Canadian dollar declined against its U.S. counterpart on Monday  as oil prices slipped and the U.S. dollar was broadly stronger against most major peers. Oil prices reversed earlier losses but were still under pressure as the rising COVID-19 cases in Europe and a potential release of Japanese and Indian oil reserves raised concerns about both oversupply and weak demand.Brent crude was last up 0.9% at $79.6 a barrel and U.S. crude rose 0.86% to $76.59 per barrel. The Canadian dollar was trading 0.4% lower at 1.3222 to the greenback. The currency touched its weakest intraday level since Oct. 16 at 1.3237.Immediate resistance can be seen at 1.2700 (23.6%fib), an upside break can trigger rise towards 1.2737 (Oct 1st high).On the downside, immediate support is seen at 1.2651(38.2%fib), a break below could take the pair towards 1.2613(50%fib).

USD/JPY: The dollar strengthened against the Japanese yen on Monday after Federal Reserve Chair Jerome Powell was nominated for a second four-year term by President Joe Biden. Lael Brainard, the Federal Reserve board member who was the other top candidate for the job, will be vice chair. The Fed will release minutes from its Nov. 2-3 meeting on Wednesday, which will be evaluated for any new indications that it may speed up the taper of its bond purchases and hike rates sooner than expected. The dollar  gained 0.79% against the safe haven Japanese yen to 114.93, approaching the 4-1/2 year high of 114.97 reached on Nov. 17.  Strong resistance can be seen at 114.8 (23.6% fib), an upside break can trigger rise towards 115.21 (Higher BB).On the downside, immediate support is seen at 114.36(32.8%fib), a break below could take the pair towards 113.92(50% fib).

Equities Recap

European shares ended flat on Monday as Germany's warning of tighter lockdown restrictions overshadowed gains in Telecom Italia following a $12-billion proposal from U.S. fund KKR to take Italy's largest phone group private.

UK's benchmark FTSE 100 closed up by 0.44 percent, Germany's Dax ended down by 0.27 percent, France’s CAC finished the day down by 0.10 percent.

Wall Street retreated from record highs on Monday, and shares of lenders rallied as two-year U.S. Treasury yields rose after President Joe Biden tapped Jerome Powell to continue as Federal Reserve chair.

Dow Jones was up by 0.05 percent, S&P 500 was down 0.32 percent, Nasdaq was down by 1.26 percent.

Treasuries Recap

U.S. Treasury yields rose on Monday after President Joe Biden announced he would nominate Fed Chairman Jerome Powell to a second term while elevating Fed Governor Lael Brainard to vice chair.

The yield on 10-year Treasury notes was up 8.9 basis points to 1.625%. The yield on the 30-year Treasury bond  was up 6.6 basis points to 1.973%.

Commodities Recap

Gold prices fell more than 2% on Monday as the dollar jumped after Federal Reserve Chair Jerome Powell was nominated for a second term, driving expectations that the central bank may stay the course on tapering economic support.

Spot gold slipped 2.1% to $1,805.30 per ounce by 02:00 p.m. ET (1900 GMT), its lowest since Nov. 5. U.S. gold futures settled 2.4% lower at $1,806.30.

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