![](https://agilityforex.com/wp-content/uploads/2024/07/Screenshot-2024-07-22-061514.png)
July 22, 2024
- Biden bows out of election.
- BoC will cut rates on Wednesday.
- US dollar opens mixed compared to Friday.
FX at a Glance
![](https://agilityforex.com/wp-content/uploads/2024/07/Screenshot-2024-07-22-060523-1024x475.png)
Source: IFXA/RP
USDCAD open 1.3744, overnight range 1.3701-1.3748, previous close 1.3727
USDCAD is trading near the top of its July range ahead of the widely anticipated Bank of Canada rate cut on Wednesday. Last week’s soft CPI data pretty much guaranteed such a move. Wednesday’s meeting comes with the quarterly Monetary Policy Report and updated forecasts.
USDCAD has stayed above 1.3590 since April 11 and that is unlikely to change this week, although the level could be tested if the BoC’s tone is on the hawkish side.
WTI oil prices are soft and traded negatively in a 78.22-79.14 range. Concerns about weak Chinese demand and Morgan Stanley analysts forecasting a oil surplus and prices in the mid to high $70’s in 2025.
Theres are not any top tier US data releases until Thursday when GDP is released and Friday when the Fed-favourite Core PCE Price Index data is reported.
USDCAD Technicals
The intraday USDCAD technical are bullish above 1.3730, looking for a move above 1.3760 to extend gains to 1.3790 while a breech of 1.3730 targets 1.3710.
Longer term, the 1.3590-1.3790 range is intact but the trend is higher while prices are above 1.3680. A move below 1.3680 suggests a retest of support at 1.3590.
For today, USDCAD support is at 1.3730 and 1.3710. Resistance is at 1.3760 and 1.3790. Today’s Range 1.3620-1.3690.
Chart: USDCAD daily
![](https://agilityforex.com/wp-content/uploads/2024/07/Screenshot-2024-07-22-071403-1024x505.png)
Source: DailyFX
Who is Really in Charge?
President Joe Biden is being hailed as a selfless, dedicated public servant by the same people who through him under the bus after his debate performance revealed he was far to feeble to govern. He announced his resignation from the presidential race in a letter that claimed it was his decision to quit. “I believe it is in the best interest of my party and the country for me to stand down and to focus solely on fulfilling my duties as President for the remainder of my term.” He failed to mention that the majority of Democrats wanted him gone so that they could at least have some hope of being re-elected. Donald Trump tactfully said, “Crooked Joe Biden was not fit to run for president and is certainly not fit to serve – and never was!”
The real question is, “Who is running the USA?”
Equities Rebounding
Asian equity indexes closed in the red, with Australia’s ASX 200 falling 0.58% on concerns about China’s economic growth prospects. European bourses ignored the drama, and the German Dax has gained 1.33%. S&P 500 futures are up 0.47%, and the US 10-year Treasury yield is 4.22%.
EURUSD
EURUSD traded in a narrow 1.0879-1.0903 range, with traders focusing on upcoming Eurozone data for clues about interest rate direction after the ECB avoided providing any forward guidance. Ireland Central Bank Governor and Governing Council member Gabriel Makhlouf confirmed that outlook when he said, “There’s no need to actually rush to make decisions.”
GBPUSD
GBPUSD is bouncing in a 1.2910-1.2940 range, with support derived from lower-than-previously-expected BoE rate cuts in 2024 and sticky inflation. Traders only expect two rate cuts compared to three earlier.
USDJPY
USDJPY traded in a 156.28-157.62 range, with prices pressured by reports that hedge funds slashed short yen positions in the week ending July 16, which occurred in conjunction with large-scale BoJ interventions. It’s not really news, but it was enough to keep selling pressure on USDJPY.
AUDUSD and NZDUSD
AUDUSD drifted lower in a 0.6661-0.6703 range, with prices failing to gain support after the PBoC cut Chinese interest rates. The currency was also undermined by weaker commodity prices.
NZDUSD tracked AUDUSD moves and traded in a 0.5991-0.6028 range, with prices at the session low in early NY trading. New Zealand’s trade deficit narrowed to -$9.4B from -$10.218B.
USDMXN
USDMXN dropped from 18.1193 to 17.9493 on broad US dollar selling pressure after Biden said he wouldn’t run for president. Mexican retail sales are due today.
FX high, low, open (as of 6:00 am ET)
![](https://agilityforex.com/wp-content/uploads/2024/07/Screenshot-2024-07-22-060033-1024x584.png)
Source: Investing.com
China Snapshot
PBoC fix: 7.1335 vs exp. 7.2624 (prev. 7.1315)
Shanghai Shenzhen CSI 300 fell 0.68% to 3514.92.
PboC cuts 7-Day repo rate from 1.8% to 1.7%,, 1-year Loan Prime Rate (LPR) to 3.35% from 3.45% and 5-year LPR to 3.85% from 3.95%. Analysts suggest is an ineffective ploy by authorities to appear to be bolstering the economy.
Last week, the Wall Street Journal reported that China’s massive development programs by local governments has debt of between $7 and $11 trillion and that $800 billion is at risk of default.
Chart: USDCNY and USDCNH
![](https://agilityforex.com/wp-content/uploads/2024/07/Screenshot-2024-07-22-051514-1024x427.png)
Source: Investing.com