June 26, 2026
USDCAD open: 1.4185, overnight range 1.4177-1.4210, close 1.4203
USDCAD retreated following yesterday’s tame US inflation data which failed to justify the need for the Fed to increase interest rates in the near term. That sentiment knocked US treasury yields lower and CAD/US 2 and 10-year interest rate differentials narrowed sharply.
WTI oil prices shrugged off a bout of anxiety after an Iranian drone hit a ship in the Strait of Hormuz. Prices jumped from 69.41 to 72.51 but have since dropped to 69.58 after the attack did not elicit any military response from the US. The Strait remains open and ships are racing through. The Strait of Hormuz monitor shows that 78 ships made it through the Strait in the past 24 hours.
The only economic news of note is the Michigan Consumer Expectations Index which is expected to be unchanged. It’s the last day of school which means it’s the official start of “summer markets.”
USDCAD Technical Outlook
The intraday USDCAD technicals have turned bearish after prices broke below the steep June uptrend line. The 4-hour MACD has crossed lower and momentum favours further downside. A sustained break below 1.4150 targets 1.3990, the prior breakout level. A move above 1.4205 would negate the setup and re-open 1.4280.
Longer term, the short-term downtrend is merely a correction as the rally from the May low remains intact. The daily MACD still confirms the uptrend, but the daily RSI has turned retreated from being extremely over-bought.
For today: USDCAD support is at 1.4150 and 1.3990. Resistance is at 1.4205 and 1.4245. Today’s expected range is 1.4130-1.4210
FX Heat Map
FX open high low 6:00 am
US Dollar Rally Taking a Breather
The “Tech Tantrum” engulfing equity indexes around the globe is said to be due to investors rotating out of crowded AI and semiconductor trades. Usually, such moves would support the US dollar, but not today. FX traders were more concerned about falling US Treasury yields after yesterday’s PCE Price Index was rather benign. The data did not suggest that there was any urgency for the Fed to hike rates which was an excuse for traders to trim long US dollar positions. The greenback is trading in early NY with losses across the board.
Taking Stock
Asian equities closed deep in the red except for Australia’s ASX 200 which ticked up 0.18%. Japan’s Topix dropped 1.32% and the Hong Kong Hang Seng fell 1.78%.
As of 5:30 am PT, the German DAX is down 1.28%, the French CAC 40 has lost 0.75% and the UK FTSE 100 has dropped 0.97%. S&P 500 futures are down 0.44%, the 10-year Treasury yield is 4.389%, the DXY is 101.23, and gold (XAUUSD) is 4,043.34
EURUSD | Range 1.1354-1.1412
EURUSD traded higher on the back of both falling oil prices and broad-based US dollar selling pressures. The Eurozone economic calendar did not have any top-tier data and traders focused on staying cool as a heat wave continues to grip Europe.
GBPUSD | Range 1.3180-1.3228
GBPUSD is near the top of its overnight range in quiet trading. GBPUSD continues to suffer from reduced risks for the BoE to hike rates and renewed political uncertainty. The currency pair is consolidating losses from June 18 and remains in a downtrend while prices are below 1.3390.
USDJPY | Range 161.54-161.85
USDJPY remains bid despite rising risks of intervention. Tokyo CPI, ex food and energy rose 1.9% y/y in June compared to 1.6% in May while the headline number jumped to 1.7% from 1.4%. That should increase the odds of a rate hike but Takaichi’s government is pressuring the BoJ to more closely align monetary policy with fiscal policy.
AUDUSD | Range 0.6876-0.6918
Aussie is tracking broad US dollar moves and traded sideways but a tad firmer overnight. The currency pair remains on the defensive after this week’s lower inflation print reduced the risk of further tightening by the RBA and Westpac bank economists suggested that the domestic economy could have contracted in June. AUDUSD remains in a month-long downtrend while prices are below 0.7000.
USDMXN | Range 17.4850-17.5589
USDMXN moved modestly higher from yesterday’s low after Banxico left its benchmark rate unchanged at 6.5%, in a widely anticipated decision. Policymakers left headline inflation forecasts for 2026 unchanged, while slightly increasing its core-inflation forecast. Traders are still cautious around the USMCA negotiations.
CHINA
- PBoC Fix: 6.8166 vs exp. 6.8015 (prev. 6.8209)
- Shanghai Shenzhen CSI 300 drops 3.03% to 4,868.22
Wall Street’s tech stock woes (AAPL, MSFT) spooked Asian equity traders in stock markets across Asia.
US bans sale of Geely-owned Polestar vehicles from 2027, citing National Security risks. China’s crude imports dropped 8% in June.
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics Tradingview
