April 8, 2026

USDCAD open: 1.3872, overnight range 1.3824-1.3900, close 1.3887

USDCAD dropped sharply in the wake of Trump’s Iran ceasefire announcement but has already retraced about 50% of the move today. The steep drop in crude oil prices is a double-edged sword for Canada. The inflationary impact from high gas prices will ease but government revenues will take a hit.

You may have noticed that despite all the political handwringing about the negative impact of high gas prices, none of them offered to slash gas taxes, which account for around 35% of the price of a litre of fuel.

WTI oil prices collapsed from 117.63 yesterday around noon hour to 91.11 in Asia and are sitting at 93.04 in NY. The ceasefire deal may be in place but no tankers have transited the Strait of Hormuz yet. Furthermore, damage to gas plants in Qatar will put a huge dent in the LNG supply. Air travellers may not see much relief in fuel surcharge pricing as jet fuel shortages are expected to last for months.

The FOMC minutes from the March 18 meeting are today, and they will be closely parsed to see which is a bigger concern for the Committee, employment or inflation.

USDCAD Technical Outlook

The intraday USDCAD technicals are bearish below 1.3890 and looking for a break below 1.3820 to target 1.3770. A move above 1.3890 opens the door to 1.3950. The 4-hour chart  show the RSI has dropped to 43 from overbought levels, suggesting fading upside momentum.

The medium-term USDCAD outlook is neutral following the rejection from the 1.4000 area and the inability to sustain gains above the upper Bollinger Band (1.4002). The downside is supported by the 100-day moving average at 1.3816 and the 200-day moving average at 1.3820. Resistance at 1.3950–1.4000 caps the topside. A sustained break below 1.3810 risks a deeper pullback toward 1.3620.

For today, USDCAD support is at 1.3830 and 1.3810. Resistance is at 1.3890 and 1.3940.

Todays range 1.3820-1.3920.

FX Heat Map (6:00 am) one week

FX  open high low 6:00 am

“Oh, What a Relief It Is”

Global markets were getting wind of some sort of US and Iran ceasefire happening late yesterday afternoon. The US dollar and oil prices drifted lower even though Wall Street closed mixed to flat; prices had recouped earlier losses.

Trump tweeted that he would “suspend the bombing and attack of Iran for a period of two weeks” at 6:32 pm ET, and the reaction was swift. As of 5:30 am, PT,  WTI oil has dropped 17.21%,.

The market is pricing a return to February 27th and may soon turn its attention to economic data, tariffs, and developments at the Fed.

Taking Stock

Asian equities rallied hard. Japan’s Topix soared 3.32%, Australia’s ASX 200 rose 2.56%, and Hong Kong’s Hang Seng rallied 3.09%.

As of 5:30 am PT, European markets are soaring. The German DAX is up 5.21%, the French CAC 40 has gained 4.81%, and the UK FTSE 100 is up 3.03%. S&P 500 futures are up 2.64%, the 10-year Treasury yield is 4.231%, the DXY is 98.65, and gold (XAUUSD) is 4,800.58.

EURUSD

EURUSD soared, rising from 1.1599 at yesterday’s close to 1.1717 overnight and into NY trading. German factory orders rose 0.9% m/m in March (forecast 2.0%, previous -11.1%), while Eurozone PPI and Retail Sales numbers were mixed. The results were ignored.

GBPUSD

GBPUSD closed at 1.3294 in NY, then rallied in a 1.3284-1.3485 range due to the ceasefire news. The relief rally is supported by an easing of interest rate hike fears, which saw forecasts for Bank of England rate hikes this year reduced to just one, in September. Halifax House Price Index fell 0.5% m/m (forecast 0.1%, previous 0.3%).

USDJPY

USDJPY dropped from 159.75 to 157.98 on the back of the steep drop in oil prices and higher wage earnings. Labour Cash Earnings rose 3.3% y/y (forecast 2.7%, previous 3.0%), which supports BoJ tightening.

AUDUSD

AUDUSD soared from 0.6968 to 0.7085 due to broad US dollar weakness and lower oil prices. On the other side of the Tasman Sea, NZDUSD tracked AUDUSD higher, but it got additional support after the RBNZ delivered a “hawkish hold” and left rates unchanged at 2.25%.

USDMXN

USDMXN dropped to 17.4418 from 17.7650 due to the improved risk sentiment. Mexico consumer confidence is on tap.

China

USDCNY Fix:  6.8680 vs exp. 6.8369 (Prev. 6.8854)

Shanghai Shenzhen CSI 300 rose 2.49% to 4,595.96

Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics Tradingview

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