June 2, 2026
USDCAD open: 1.3851, overnight range 1.3832-1.3853, close 1.3841
USDCAD inched higher due to widening CAD/US interest rate spreads which favour the US dollar. Yesterday’s ISM data supported higher US interest rates while last week’s Canadian Q1 GDP numbers painted a picture of a sick economy, flirting with a recession.
Soaring US Tech and A1 stocks are also underpinning USDCAD demand. The US government has already committed to massive, multi-year AI investments. Meanwhile, the Canadian government is stalking about an upcoming A1 strategy. A day late and a dollar short.
WTI traded in a USD 90.17–92.74 range overnight and sits near USD 90.97 in early New York. Prices are down about 1% from yesterday as traders faded Monday’s geopolitical spike and priced in more constructive U.S.–Iran ceasefire signals. Profit‑taking after the prior session’s surge also weighed on crude, though conflicting Iranian rhetoric kept a floor under prices.
USDCAD Technical Outlook
The intraday technicals are bullish above 1.3820 but 4-hour RSI are in extreme overbought territory, warning of a near-term pullback. A break below that level targets 1.3820 targets 1.3760.
Longer term, USDCAD is grinding out gains within a well-defined uptrend channel, pressing resistance at the 1.3880 area, a level that has capped rallies on multiple occasions. The daily RSI elevated but not yet extreme, and the MACD histogram is positive and expanding, arguing for a test of the 1.3880 resistance. A sustained break above that level opens the door to 1.3950. Failure there shifts the focus to 1.3710.
For today, USDCAD support is at 1.3820 and 1.3780. Resistance is at 1.3880 and 1.3910. Today’s range: 1.3820-1.3890.
FX Heat Map
FX open high low 6:00 am
FX Traders Uninspired
FX markets were very subdued overnight despite a barrage of headlines around Middle East developments and Russia’s latest attack on civilian infrastructure in Kyiv and other major Ukrainian cities. The US dollar is trading little changed but mixed in early NY.
Yesterday, US ISM Manufacturing PMI data rose to 54 from 53.7 in April which reinforced the sentiment of a resilient US economy, that does not need the stimulus of a Fed rate cut. Treasury yields rose in response which underpinned the greenback.
Markets are still optimistic for a US and Iran ceasefire but what should scare them silly is the news that the US is in talks to deploy nuclear weapons in Europe.
Today’s JOLTS Job openings data for April is expected to be little changed at 6.82 million compared to 6.866m in March
Taking Stock
In Asia, Chinese markets decoupled from others in the region. Hong Kong’s Hang Seng Index soared 2.52% to 26,038.32 on the back of Tencent nearing approval for its AI integration into WeChat. Japan’s Topix fell by 0.42% and Australian ASX 200 finished flat.
As of 5:30 am PT, European bourses are higher across the board led by the German Dax gaining 0.80%. The French CAC 40 is up 0.69% while the UK FTSE 100 has climbed 0.26%. S&P 500 futures are down 0.19%, partly because of AI spending fears. The10-year Treasury yield is 4.428%, DXY is 99.07, and gold (XAUUSD) is 4,529.26.
EURUSD | Range 1.1629-1.1654
EURUSD recouped yesterday’s losses supported by sticky inflation. Eurozone inflation rose 3.2% y/y in May, compared to 3.0% in April which signals a green light for the ECB to raise rates on June 11. The EU Parliamentary voted to except the lousy US trade deal. That’s the one where the EU removes tariffs on US industrial goods and gives preferred access to American agricultural and seafood products. In return, EU exporters face 15% US tariffs. The entire EU parliament will vote on the decision in a couple of weeks.
GBPUSD | 1.3451-1.3482
Sterling recovered all of yesterday’s post-ISM losses and is looking to challenge resistance in the 1.3510 area. Prices are supported by easing US Treasury yields and steady Gilts. News that UK mortgage approvals rose by 65.9k which beat consensus suggests the UK economy is more resilient than previously expected. Even better, negative headlines about UK political risk have diminished.
USDJPY | Range: 159.59-159.77
USDJPY is underpinned by demand following yesterday’s ISM data and the bump in Treasury yields which served to widen JGP/US Treasury yield spreads. Firmer oil prices provided additional USDJPY support. However, the rising threat of another bout of BoJ intervention around the 160.00 area, tempered demand.
AUDUSD | Range: 0.7153-0.7187
The Australian dollar survived selling pressure from the US data and then gained after tech and AI stocks rallied due to improved risk sentiment. AUDUSD got a bit of a lift after RBA Board member Ian Harper warned that long term inflation expectations have increased.
USDMXN | Range: 17.2736-17.3691
USDMXN is sliding on improved risk sentiment after Trump told reporters he thinks there wil be an agreement with Iran to extend the ceasefire and reopen the Strait of Hormuz. Of course, he has been saying the same thing for a couple of weeks.
CHINA
- PBoC Fix: 6.8187 vs exp. 6.7720 (prev. 6.8167)
- Shanghai Shenzhen CSI 300 rose 1.45% to 4,914.56
Wall Street’s positive close on the back of tech sparked another round of Asian tech stock/AI demand.
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics Tradingview
