USDCAD Overnight Range 1.2968-1.3083
NOTE: This chart represents gain (or loss) of G10 currencies vs. the US dollar from NY close (4pm) to 5:30 am PDT
The US dollar is in retreat. A broad-based shift in global sentiment has led to an extension of yesterday’s risk rally and as a rising tide lifts all boats, the sinking US dollar has lifted the Loonie. US equity futures and global equity indices are much higher from their previous closes with the UK FTSE 100 up 2.08%. Traders have shrugged off any market concerns from the Istanbul terrorist attack.
USDJPY reversed Asia losses in early European trading helped by additional comments from the Japanese Prime Minister. He repeated that Japan would use all available tools to keep the economy going. One of his key advisors, Masahiko Shibayama threatened intervention “if prices become unstable”. While nothing even remotely new, USDJPY buyers still emerged.
Oil prices were confused. They drifted lower in Asia, rebounded in Europe and slid again, in early New York trading but have since rebounded. WTI has traded within a $48.08-$48.56 since yesterdays close.
The improved risk tone following the UK’s Brexit vote could be fleeting. Senior EU officials have met with Scottish leaders who do not want to leave the EU. The UK political landscape is a dogs breakfast and France appears willing to play hardball with the UK.
Reuters reports that JP Morgan says it expects Scotland to vote for independence and introduce its own currency before Britain leaves the EU. England has the pound; would Scotland have the Haggis?
USDCAD direction continues to be governed by US dollar sentiment and oil and not domestic data. Month end and quarter end rebalancing flows tomorrow, combined with the Canada Day holiday on Friday may limit USDCAD losses.
USDCAD technical outlook
The intraday USDCAD technicals are bullish while trading above 1.2980 looking for a break of the 100 day moving average at 1.3065 to extend gains to 1.3200. Longer term, the 38.2% Fibonacci retracement level of the January-June range is at 1.3309 which makes a nice target. For today, USDCAD support is at 1.2970 and 1.2940. Resistance is at 1.3040 and 1.3070.
Today’s Range 1.2970-1.3040
Chart USDCAD daily