October 17, 2025
USDCAD open: 1.4043, overnight range 1.4036-1.4067 close, 1.4058
Prime Minister Carney opted not to retaliate against the US following the latest round of tariff increases on softwood lumber exports. He said that “Right now with the Americans we are engaged in deep negotiations, intensive negotiations on several sectors of the Canadian economy – energy, aluminum and the steel sector. There are times to hit back and times to talk and right now is the time to talk.”
WTI oil prices fell to 56.66 in early NY trading from an Asia peak of 57.56 following Trump and Putin’s call which Trump described as “ very productive.” Apparently Trump’s talks of supplying Ukraine with long range Tomahawk missiles got Putin’s attention. In addition, the International Energy Agency is forecasting an oil glut in the first half of 2026.
USDCAD Technical Outlook
The intraday USDCAD technicals are bullish above 1.4010 and are looking for a break above 1.4070 to extend gains to 1.4140 (the50% Fibonacci retracement of the September 2024-January 2025 range). A break below 1.4010 suggests a dip to 1.3970.
The medium-term technicals are bullish after taking out resistance in the 1.3890 area. The momentum indicators point to further gains to 1.4140
For today, USDCAD support is at 1.4010 and 1.3970. Resistance is at 1.4070 and 1.4110.
Today’s Range: 1.4010-1.4070.
Jamie Dimon Sees Cockroaches
JPMorgan Chase President warned that “when you see one cockroach, there’s probably more,” in reaction to the collapse of auto lender Tricolor Holdings and auto parts supplier First Brands. He was right. US regional bank shares came under pressure after Zions Bancorp and Western Alliance Bancorp reported losses on what they claimed were “fraud loans.”
That news, on top of escalating China and US trade tensions, and the ongoing US government shutdown that has delayed top-tier economic data, sparked a flight into safe havens. The Japanese yen and Swiss franc rose, gold spiked to 4379.29 from 4279.22, and the 10-year Treasury yield slid to 3.933%
Taking Stock
Asian equity markets followed NY indexes lower and closed in negative territory. Japan’s Topix lost 1.03%, Australia’s ASX 200 fell 0.81%, and Hong Kong’s Hang Seng plunged 2.48%.
As of 5:30 AM PDT, European indexes are in the red. Germany’s DAX index has dropped 1.50%, the UK FTSE 100 is down 0.97%, and the French CAC-40 is flat. S&P 500 futures are off its worst level and is down 0.11%. U.S. Dollar Index (DXY) is 98.42 while the U.S. 10-year Treasury yield has climbed to 3.997% from 3.933%. Gold (XAUUSD) is now 4294.95.
EURUSD
EURUSD got a boost from broad U.S. dollar weakness and rose to 1.1729 from 1.1682 before retreating to 1.1697 in early NY. French Prime Minister Sébastien Lecornu survived no-confidence votes, which downgraded political risks in France (for now), providing another layer of support for the single currency. Eurozone Core HICP rose 2.4% y/y in September, a tick higher than the 2.3% expected.
GBPUSD
GBPUSD traded defensively in a 1.3411–1.3472 range, with selling pressure due to negative risk sentiment. The U.S. regional bank losses and China/U.S. trade tensions had traders squaring positions ahead of the weekend.
USDJPY
USDJPY dropped in a 149.38–150.45 range on safe-haven demand for yen, which offset concerns around the political landscape. Furthermore, recent comments by many Fed officials suggest that U.S. interest rates have a lot further to fall.
AUDUSD
AUDUSD retreated in a 0.6444–0.6493 range due to “risk-off” sentiment from U.S. regional bank woes and China/U.S. trade tensions. In addition, lingering fallout from the weaker-than-expected domestic employment report is also undermining the currency.
USDMXN
USDMXN rallied in an 18.4249–18.5528 range, recouping all the losses since Wednesday. The gains are due to broad U.S. dollar strength from renewed risk aversion.
China
PBoC fix: 7.0949 vs exp. 7.1154 (Prev. 7.0968)
Shanghai Shenzhen: CSI 300 fell 2.26%% to 4514.23
China’s next 5-year plan discussions take place from Monday to Wednesday next week. The PBoC interest decision is due Monday and no change is expected.
FX High, Low, Open
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics
