It is WEED Day in Canada. Those of us of a certain vintage will recall Styxx extolling fans in 1975 to “light up everybody, join us in this celebration, light up and be happy.” Today, Canadian stoners and stoner-wannabe’s will be sparking up doobies to celebrate Prime Minister Trudeau’s blatant vote-grabbing marijuana legalization legislation.
While Canadian’s are passing the time in a herbal heaven, the rest of the market will be twiddling their thumbs until the release of the FOMC minutes, due at 2:00 pm EDT. The minutes will be parsed for evidence of a more hawkish bias at the Fed.
The US dollar is opening with small gains across the board, led by a drop in GBPUSD. Asia equities tracked US indices and closed with gains. European bourses didn’t follow suit. They are lower except the UK FTSE 100 which is flat (as of 6:30 GMT) US equity futures point to a lower opening today.
EURUSD is a tad softer and is at the bottom of its 1.1549-1.1579 overnight range, in early New York trading, thanks to weaker than expected September Core CPI. (Actual 0.9% vs forecast 1.0% y/y)
GBPUSD is suffering the same fate. UK September headline CPI dropped to 2.4% y/y. The forecast was 2.8%. However, Core CPI rose 1.9% y/y (Forecast 1.8%) in the same period. The strong dollar and Brexit concerns are weighing on Sterling. Reuters reported that the EU was getting ready to tell UK PM Theresa May to “take the Brexit deal on offer or be cut loose without one in March.” GBPUSD is trading at 1.3127 in early New York trading.
The Antipodean currencies are close to flat while USDJPY consolidated in a 112.16-112.40 range.
USDCAD Technical Outlook
USDCAD is in a minor uptrend while prices are aboe 1.2940, looking for a break of resistance in the 1.2990-1.3005 area to lead to a test of 1.3060. A break below 1.2940 will lead down to 1.2905. The longer term uptrend from February is intact while prices are above 1.2850.
Today’s Range 1.2920-1.3010