EURUSD gapped lower at the open in Asia. News that German Chancellor Angela Merkel failed to secure a coalition partner(s) sparked a bit of political uncertainty. EURUSD dropped from 1.1794 to 1.1723. Prices fully recovered in Europe as traders dismissed German politics as “noise” and equity markets rallied.
Sterling bounced, rising from 1.3187 to 1.3278, powered by improved UK rate hike expectations and broad US dollar weakness.
USDJPY traded sideways in a 111.89-112.20 range. The technicals are bearish and looking for a break below 111.60 to extend losses.
The New Zealand dollar stopped sinking. NZDUSD climbed from 0.6796 to 0.6837. Profit-taking and negative US dollar sentiment were behind the move.
AUDUSD traded in a narrow band torn between selling pressures from soft inflation data and emplyment report gains.
Oil prices stayed firm ahead of Thursday’s 173rd (Ordinary) Opec General Meeting in Vienna. Traders are expecting that the cartel (and Russia ) will announce and extension the production cuts, which are supposed to end March 30, 2018.
USDCAD remains in an uptrend, supported by divergent Bank of Canada and Federal Reserve interest rate policies, a dash of NAFTA collapse fear and bullish technicals. Firm oil prices are acting as a drag on USDCAD gains.
There aren’t any economic reports from the US or Canada today. The US tax debate is on the back burner because of Thanksgiving. The politicians give American’s a one-day holiday to celebrate Thanksgiving, but they take the entire week. That’s because they must be special or perhaps it’s because they are a flock of turkey’s and want to make themselves scarce.
USDCAD Technical outlook:
The USDCAD technicals are bullish while prices are above 1.2720 looking for a break above 1.2820 to extend gains to 1.2915. A break below 1.2720 will lead to a retest of support in the 1.2640-60 area. For today, USDCAD support is at 1.2720 and 1.2670. Resistance is at 1.2790 and 1.2820
Today’s Range 1.2740-1.2820
Chart: USDCAD 30 minute