Overnight Range 1.3352-1.3388
Its here! The seemingly endless Presidential campaign concludes today, maybe. Donald Trump is on record saying he wouldn’t accept the results if he loses. But what can he do? The US tried breaking into two countries 155 years ago and it didn’t work.
The overnight session was as dull as dishwater. China Trade data under performed expectations. The trade surplus narrowed to $49.06 billion. (forecast $51.7 billion) Exports declined 7.3% while imports were down 1.4%. The news took the shine off the Australian dollar which had rallied on Monday and AUDUSD inched lower.
USDJPY managed to keep almost all of Monday’s gains supported by increased expectations of additional Bank of Japan easing in December and hopes of a Hillary Clinton victory.
In Europe, EURUSD and GBPUSD were quiet and started the New York session right where they left off on Monday.
Oil prices are almost unchanged. WTI drifted higher in early European trading but gave back those gains a few hours later. Opec released the 10th annual World Oil Outlook 2016 today. They increased their forecast for 2017 global oil demand expecting cheaper prices to drive consumption.
Global equity indices were flat to slightly lower as traders were content to await the election results.
The day ahead will look a lot like the evening that preceded it. Dull. FX traders will hug the sidelines watching election coverage. Chicago Fed President Charles Evans is speaking today but markets are unlikely to pay any attention to him.
Canadian Housing Starts are forecast at 195,000 but could miss due to new mortgage rules. Nevertheless, the data won’t have any USDCAD trading impact today.
USDCAD technical outlook
The intraday USDCAD technicals are bearish while prices are below 1.3405 looking for a break of support at 1.3350 to extend losses to 1.3305 and then 1.3260. A break of 1.3405 targets 1.3460 and 1.3550.
USDCAD has rallied on the back of a dovish Bank of Canada, US rate hike concerns and a decline in oil prices with a dose of Trump=phobia thrown in. It is fair to say that the market is long USDCAD. A Hillary Clinton win will lead to a “relief rally” and the Canadian dollar will benefit with a retest of 1.3050 likely.
Today’s Range 1.3320-1.3420
Chart: USDCAD daily with moving averages