UK Traders returned from a day off and bought US dollars, crushing the Loonie in the process.
USDCAD was steady to bid in Asia and then soared during the European session, coinciding with broad US dollar strength. Prices roared higher, rising from 1.2878 to 1.2982 and are still hovering near the peak at the time of writing.
Arguably, the catalyst for the rally may be bout of risk aversion US dollar demand ahead of President Trump’s 2:00 pm EDT announcement about the Iran Nuclear Deal. The evidence is in Japanese yen and Swiss franc. Both are safe-haven currencies, and both made marginal gains against the greenback.
Sterling kicked off the dollar rally. GBPUSD plunged from 1.3591 to 1.3497 when April House prices dropped 3.1%, m/m. The subsequent bounce has been shallow.
EURUSD ignored mixed German Trade and Industrial Production data, and it followed GBPUSD lower. ECB Chief Economist Peter Praet said that that recent soft data was not evidence of a lasting slow-down. Traders ignored his remarks.
In Asia, AUDUSD dipped after Retail Sales were weaker than expected (Actual 0.0% vs forecast 0.3%) Prices rebounded but got crushed again during the European sell-off. AUDUSD opened in New York at the bottom of its 0.7455-0.7526 range.
FX markets will be choppy as traders jockey for position ahead of President Trump’s 2:00 pm EDT speech.
USDCAD Technical Outlook
The USDCAD technicals turned decisively bullish with the break above resistance in the 1.2920-50 area, putting a target directly on the 2018 peak of 1.3120 area. The USDCAD uptrend is intact while prices are above 1.2850. For today, USDCAD support is at 1.2950 and 1.2920. Resistance is at 1.2980 and 1.3020
Todays Range 1.2940-1.3020