October Durable Goods orders were weaker than expected. (Actual -1.2% vs forecast 0.3%, m/m; ex-transportation 0.4% vs forecast 0.5%, m/m. The US dollar barely budged on the news due to the upcoming Thanksgiving holiday and because the headline number is often volatile.
Initial Jobless Claims (Actual 239,000 vs forecast 240,000) was close enough to the forecast to be a non-event.
it is “Travel Day in America.” Millions of people take to the skies, roads and rails to head home for the holidays. Those that could, have already gone and those that couldn’t are getting ready to sneak out of work early.
The FOMC minutes are due at 2:00 pm. The market expects the minutes to be a non-event which is a good thing because most of America will be gone for the day.
The US dollar opened in New York with small losses against the majors except for the antipodean currencies.
EURUSD was contained in a tight band with traders content to remain on the sidelines in case of a surprise from the FOMC minutes.
It’s budget day in the UK which made GBPUSD traders stay close to home. GBPUSD was a tad perky after news that the EU/UK expect to have a divorce agreement in place in three weeks. GBPUSD dropped after the UK Budget Office downgraded growth forecasts. Prices recovered quickly as the downgrades were expected.
Oil prices rallied thanks to a leaky Keystone Pipe. Reuters reports that the Keystone Pipeline reportedly carries 590,000 barrels of crude per day. The leak will cut 85% of that flow. WTI jumped from $57.06 to $58.02, helped by the API weekly crude stock change report showing a drop of 6.35 million barrels in crude inventories. The EIA Crude stocks report is due later this morning. Traders are looking for a bigger draw-down than the 2.16 million barrels forecast because of the API results.
USDCAD is under pressure due to the high oil prices and profit-taking after the failure to break above resistance at 1.2830. There aren’t any Canadian data releases today.
USDCAD Technical outlook:
The USDCAD technicals flipped to bearish with yesterday’s drop below 1.2790 and this mornings break of support at 1.2750 (the 50% Fibonacci retracement level of the Nov. 12-Nov. 21 range) A break below 1.2730-40 area targets 1.2690. and then 1.2660. A move above 1.2770 would negate the downside and retarget 1.2830. For today, USDCAD support is at 1.2730, 1.2690 and 1.2660. Resistance is at 1.2770 and 1.2830.
Today’s Range 1.2720-1.2790
Chart: USDCAD 30 minute