Wed 3rd Nov: Dollar battles the election blues; trading expected to be range bound

Dollar lost most of its late European and early US trading session gains as rumours of a possible Kerry win hit the market. The traders unanimously agree that whatever be the outcome of the elections a swift decision would be dollar positive in the very near term though most of the likely gians would soon disappear as the markets would then look towards the existing fundamental strength of the US economy yet again.
The dollar hit 1.2660 aganist the single curency which showed disappointing data releases from Germany whose retail sales for September slipped below expectations. The single currency could chart new highs in the current rally ; should there be any uncertainity in the results of the US elections.
A stronger than expected CBI numbers from UK ensured that Pound vanquished the 1.84 levels.
Further dollar selling also ensued across the Pacific with the Japanese currency on the brink of breaching the 106 levels despite Japan's finance minister stating that any further movement in the currency could meet with action from the government.
The US stocks showed a strong response to the early exit polls as the Dow Jones fell from +100 to -40 before closing the day at -19. The markets would today focus on the US elections and majors should remain within a tight range.