April 24, 2025

USDCAD: open 1.3844, overnight range 1.3840-89, close 1.3881

President Trump needs an easy victory. China responded to US tariffs with almost equal fervor and so far, and according to the Chinese Ministry of Commerce, has no interest in negotiating while tariffs are in place.

So, Trump turned his sights on Canada again.

“I really don’t want cars from Canada. So, when I put tariffs on Canada, they’re paying 25%, but that could go up in terms of cars. When we put tariffs on, all we’re doing is saying, ‘We don’t want your cars, with all due respect.’ We really want to make our own cars — which is what we’re doing, in record numbers.”

Traders largely ignored the news because it was nothing new. However, that may be a mistake.  Canada is more vulnerable to US tariffs as over 75% of exports are to America. Only 14.8% of Chinese exports go to the US. Canada’s lack of trade diversity is a vulnerability that Trump seeks to exploit.

US data weekly jobless claims were 222,000, 6,000 higher than last week’s upwardly revised number. Durable Goods Orders surged 9.2% in March, mainly due to front-loading orders ahead of tariffs.

USDCAD Technicals

The USDCAD intraday technicals are bearish while trading below 1.3865 and looking for a retest of minor support in the 1.3820 area. A topside break will extend gains to 1.3920.

Longer term, USDCAD may revisit resistance at 1.4110, the 50% Fibonacci retracement level of the October February range on a decisive break above 1.3950. However as long as prices remain below the 2-day moving average at 1.4010, further weakness to 1.3720 is possible.

For today, USDCAD support is at 1.3840 and 1.3790. Resistance is at 1.3890 and 1.3950

Today’s Range: 1.3820-1.3920

Chart: USDCAD daily

FX at a Glance

Telling Tales About Tariffs

President Trump’s ego is getting battered. Americans do not think he is managing the economy very well and Wall Street agrees. The steep dive in stocks, bonds, and the dollar forced him to rethink how to implement his strategy. The Administration claims over 70 countries are lining up to negotiate but can never name more than a dozen. China has outright refused negotiations while tariffs are in place.

To date, Trump’s attempt to Make America Great has fueled a wholesale divestiture of US assets and devalued the dollar. His administration is embroiled in over 140 lawsuits filed by states, civil rights groups and businesses. That suggests the recent stock market and dollar rebound is just temporary.

Negative Risk Sentiment Weighing on Equities.

US equity traders were emboldened by Trump dialing back the harsh rhetoric against China and Fed Chair Powell, and Wall Street closed with gains. Asian equity indexes followed suit with Australia’s ASX gaining 0.60% and Japan’s Topix rising 0.32%.

It was a different story in Europe after Chinese authorities denied that Beijing and Washington were in trade talks. The European bourses are in negative territory led by a 0.27% decline in the German Dax. S&P 500 futures are off its worst levels but are still down 0.19%. The CBOE VIX index is 28.4 while the US 10-year Treasury yield is steady at 4.326%. Gold (XAUUSD) rose to 3367.89 from 3288.30

EURUSD

NY Open: 1.1385 Overnight Range: 1.1315-1.1393

EURUSD traded sideways but with a bit of a bid supported by better-than-expected German Ifo data. April Business Climate, Current Assessment and Expectations beat forecasts and the March results.

GBPUSD

NY Open: 1.3308, Overnight Range: 1.3254-1.3321

GBPUSD traded inside yesterday’s range due to a lack of domestic catalysts. The topside is capped by weaker UK consumer confidence and comments from Bank of England Governor Bailey who warned that the UK’s open economy makes it vulnerable to a global trade war.

USDJPY

NY Open: 142.40, Overnight Range: 142.31-143.46

USDJPY peaked in Asia then drifted steadily lower and opened in NY at its session low. The increase in negative risk sentiment in Europe weighed on the currency. The short-term technicals suggest a break below 141.50 will extend losses to 140.50.

AUDUSD

NY Open: 0.6386, Overnight Range: 0.6344-0.6389

AUDUSD clawed back some of yesterday’s losses on the back of broad-based US dollar selling pressure. Prices are underpinned by Washington’s expressed desire to kickstart trade talks with China, although Beijing is not as willing.

NZDUSD

NY Open: 0.5977, Overnight Range: 0.5942-0.5983

NZDUSD traded sideways but with a modestly bullish bias on hopes that China and the US begin trade talks.

USDMXN

NY Open: 19.5898, Overnight Range: 19.5773-19.6495

USDMXN inched lower after it saw its first half of April core-inflation rising 0.34%, which was higher than the 0.2% expected and above the previous reading of 0.24%.  Yesterday, traders shrugged off a weaker-than-expected Retail Sales report and prices drifted lower due to a generally weak US dollar.

China Snapshot`

PBoC fix:  7.2098 vs exp. 7.3111 (Prev. 7.2116)

Shanghai Shenzhen 300 fell 0.07% to 3784.36

The Ministry of Commerce demanded that Trump revoke all tariffs. Despite Trump’s claims to the contrary, the spokesman also denied that China and the US were having trade talks.

FX high, low, open (as of 6:00 am ET)

Sources: Yahoo Finance, Oanda, Investing.com, Bloomberg.