Morning Commentary & Currency Insights – December 20, 2017

Yesterday’s failure to break above the 1.2910-20 level will make it difficult for options plays towards 1.3000 for the highly publicized expiries at 10 AM EST this morning.  With little else going on in the G7 currency  complex these options may just fizzle out and slowly fade away as we trade near 1.2860 for the 10^th day in a row.  A note of caution – last time I dismissed option expiries that were 150 points away the market traded directly to that point so the possibility remains, however slight it may be.  Canadian wholesale trade data is out at 8:30 but this is a minor release which should not have a great deal of impact.  Tomorrow’s retail sales and, more importantly, CPI will have the market’s attention given BoC Governor Poloz’s assertions of anticipated higher readings and should give us direction into the new year.