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By XE Market Analysis November 7, 2018 3:07 pm
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    XE Market Analysis: Asia - Nov 07, 2018

    The Dollar fell in overnight trade, with the initial reaction to the U.S. elections taken as sa net-negative by the markets. A surge on wall Street reversed that sentiment however, and the Greenback managed a modest rally through the morning session. EUR-USD fell to 1.1445 lows from 1.1500 ahead of the open, as USD-JPY topped 113.45 from 112.95. USD-CAD rallied to 1.3119 highs as oil prices again fell. GBP-USD peaked at 1.3175 before falling back to 1.3119 lows.

    [EUR, USD]
    EUR-USD relinquished its overnight gains, pulling back from near three-week highs of 1.1500, to 1.1443 lows after the London close. The Dollar has generally firmed up following the elections, the outcome of which has so far made Wall Street happy, and has supported the Greenback. EUR-USD can be expected to remain in sell-the-rally mode, as slowing EU growth, and a dovish ECB contrast with a strong U.S. economy and a rate-raising Fed

    [USD, JPY]
    USD-JPY recovered during the N.Y. session bouncing from pre-open lows of 112.95 to highs over 113.45. The sharp post-election Wall Street rally has been supportive, though initial reaction overnight once it became clear the Democrats took back the House, was to sell the pairing. From here, it appears some consolidation may be in order, after printing a one-month high of 113.82.

    [GBP, USD]
    Cable was up for a fifth day out of the last six, earlier printing a three-week peak at 1.3175 before settling around 1.3140-50. Recent gains the Pound has seen reflected a lessening in sterling's Brexit premium, though there is a risk that hopes of the EU and UK are nearing to making an agreement on divorcing terms are being overegged as the seemingly intractable Irish border backstop issue still remains unresolved.

    [USD, CHF]
    EUR-CHF was steady near 1.1450, recovering from the four-week printed at 1.1355 last Wednesday, which extended a descent from levels above 1.1500. Signs of flagging Eurozone growth and concerns about the Eurosceptic populist movement have seen the common currency fall out of favor. EUR-CHF has support at 1.1355-62, which encompasses the recent low and the prevailing situation of the 50-day moving average.

    [USD, CAD]
    USD-CAD fell to 1.3056 lows in early North American trade, a four-session low. The pairing later perked up over 1.3119 as WTI crude slipped to session and trend lows of $61.22. The EIA inventory report revealed a larger than expected U.S. oil build.

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