June 10, 2026
USDCAD open: 1.3927, overnight range 1.3924-1.3957, close 1.3948
USDCAD continues to inch lower after failing to crack resistance in the 1.3970 area yesterday. The retreat wss mainly due to position adjusting ahead of today’s US inflation numbers and then prices barely moved when headline CPI rose 4.2%, as expected.
The widening of CAD/US 2-year interest rate spreads is limiting losses.
Canada posted back-to-back trade surplus when April’s data came in at $2.7 billion but the news had little impact on FX trading.
The Bank of Canada is expected to leave rates unchanged at today’s meeting and deliver a dovish outlook. They can hardly talk about the need to hike rates after the latest GDP numbers and the “technical recession” result. But they can afford to wait as unlike in other regions, Canada does not have an inflation problem according to BoC metrics. Consumers may think otherwise.
WTI oil ignored the latest ceasefire violations by Iran and the US and prices are in the middle of the 87.50-89.95 range. No ships made the transition through the Strait of Hormuz in the past 24 hours.
USDCAD Technical Outlook
The intraday technicals are bearish below 1.3970. The 4-hour chart shows price rolling over from the top of the band. The momentum indicators (RSI and MACD with the RSI are turning negative which warns of further losses. A break below 1.3907 (the 4-hour lower Bollinger Band) targets 1.3874.
The uptrend line from the May low, currently rising near 1.3860, is the deeper downside target. A recovery above 1.3970 negates the bearish setup and opens the door to a retest of 1.4066.
Longer term, USDCAD is bullish above 1.3860 and as long as it holds, the uptrend targets the 1.4066 level marked by the upper daily Bollinger Band (3 standard deviations).
For today: USDCAD support is at 1.3905 and 1.3870. Resistance is at 1.3970 and 1.4066. Today’s expected range is 1.3890-1.3970.
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FX Heat Map
FX open high low 6:00 am
Tit-for-Tat Tic-Tac-Toe
The US attacked Iran then became indignant when Iran retaliated. That’s gone on since the beginning of March. Iran, a country that Trump say’s its leadership has been “neutralized,” its navy is at the” bottom of the sea”, and its nuclear enrichment facilities have been “completely and totally obliterated” is making a monkey out of American military might.
Then America sought a ceasefire which looks like this: Monday, Iran took out an American Apache helicopter worth around $40 million with a$30,000 drone. The US responded overnight with attacks on Iranian air defence systems, while Iran fired missiles and drones at US military bases in Jordan and elsewhere.
Now Trump is irked and he took to TruthSocial this morning to tweet: “Iran’s Military is a complete and total mess. Much of it, like their Navy and Air Force, doesn’t even exist anymore – They have been completely defeated. Iran is all talk and no action. The Bully of the Middle East is DEAD!!! They’ve taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!
That begs the question, if what Trump said is true, who is the US talking to?
The news didn’t really bother traders. Oil prices consolidated yesterday’s losses, and the greenback drifted lower. Traders are focused on today’s US inflation report and Friday’s SpaceX IPO which is reportedly, nearly 4x over-subscribed.
Taking Stock
Asian equities closed mixed due to the US/Iran ceasefire violations and higher PPI numbers from China. Japan’s Topix dropped 1.25%, the Hong Kong Hang Seng Index fell 0.64%, while the Australian ASX 200 closed with a gain of 0.57%.
As of 5:30 am PT, European bourses are in the red. The German DAX is down 0.81%, the French CAC 40 has lost 0.36%, and the UK FTSE 100 is down 0.33%. S&P 500 futures are down 0.78%, the 10-year Treasury yield is 4.529%, the DXY is 99.94, and gold (XAUUSD) is 4,167.93.
EURUSD | Range 1.1533-1.1560
EURUSD treaded water in a narrow band ahead of this morning’s US inflation data. Core CPI rose 2.9% from 2.8% y/y as expected while the monthly number ticked down to 0.2% from 0.4% m/m. Tomorrow’s ECB monetary policy meeting and the latest US and Iran ceasefire violations were another reason for traders to stay on the sidelines.
GBPUSD | Range 1.3368-1.3401
Sterling drifted higher in an uninspired trading session with prices getting a bit of support from lower crude prices. However, the latest US and Iran flare up tempered the enthusiasm for additional gains.
USDJPY | Range 160.24-160.53
USDJPY traders drove the currency pair deeper into “intervention-trigger” territory in defiance of Japanese official warnings about “monitoring excessive FX moves.” Traders fear the risk of the rising odds for a Fed rate hike more than they do the prospect of a BoJ rate hike June 16.
AUDUSD | Range 0.6998-0.7033
Aussies drifted lower on the back of Chinese inflation data and divergent monetary policies between the RBA and the Fed. The RBA’s hiking cycle appears to be over, while the Fed may be kicking off one, soon.
USDMXN | Range 17.4208-17.4909
USDMXN traded sideways ahead of today’s US inflation data. The downside faces hurdles from the ongoing USMCA talks and rising risks of higher US interest rates.
CHINA
- PBoC Fix: 6.8130 vs exp. 6.7749 (prev. 6.8147).
- Shanghai Shenzhen CSI 300 fell 1.11% to 4,748.59
China May CPI rose 1.2% y/y (forecast 1.3%, previous 1.2%) and fell 0.1% m/m (forecast -0.2%, previous 0.3%). PPI rose 3.9% y/y (forecast3.8%, previous 2.8%)
The PPI increase was all due to the fall-out from Trump’s war with Iran.
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics Tradingview
