EGB OPTIONS: Bund put fly seller

The nominally centre-right Gaullist Les Republicains (LR) elected Eric Ciotti as new party head on Sunday, signalling a further shift to the political right in a party that has found itself squeezed on both sides in recent years. In the April presidential election, LR candidate Valerie Pecresse secured less than 5% of the vote, the worst result for the party or its predecessors in the Fifth Republic.

• Ciotti, a deputy from the Nice area, stated he intends to fight to, "rehabilitate the value of work, fight against violence and disorder in the streets, stop the migratory invasion and the rise of Islamism".
• First big test comes in pension reform, where Pres. Macron wants to raise the age from 62 to 65. LR is broadly supportive of the move, but Ciotti is fiercely anti-Macron and may not want to offer any support.
• Mujtaba Rahman at Eurasia Group writes on what Ciotti's election means for LR: "[...] The old, broad centre-right movement of Charles de Gaulle, Jacques Chirac and Nicolas Sarkozy is no more [...]. His enemies fear he will, de facto, merge LR with populist-nationalist Right of Le Pen & Zemmour. A group of moderate LR parliamentarians detest Ciotti. [...] An outright split is probable in the long run but most LR deputies may give Ciotti time to fulfil his pledge to reunite the party. [...] [Ciotti] is less interventionist & more classically conservative than Le Pen on econ issues."

• RES 4: 1.3855 High Oct 21 - Nov 16 bear leg
• RES 3: 1.3808 High Nov 3 and a key resistance
• RES 2: 1.3751 High Nov 4
• RES 1: 1.3700 High Dec 7
• PRICE: 1.3651 @ 08:00 GMT Dec 12
• SUP 1: 1.3504/3385 Former trendline resistance / Low Dec 5
• SUP 2: 1.3317/3226 Low Nov 24/25 / Low Nov 15 and bear trigger
• SUP 3: 1.3205 61.8% retracement of the Aug 11 - Oct 13 rally
• SUP 4: 1.3139 Low Sep 14

USDCAD is consolidating and trading closer to its recent highs. The short-term outlook remains bullish. Last week’s gains resulted in a break of trendline resistance drawn from the Oct-13 high. The trendline intersects at 1.3504 and represents support. Attention is on 1.3751 next, the Nov 4 high and 1.3808, the Nov 3 high. The latter is a key resistance and a break would strengthen bullish conditions.