Canada September Retail Sales were expected to rise 0.9%,m/m  and the ex-autos component gaining 1.0%.  They didn’t.  Instead, Retail Sales were a dismal 0.1%, while ex Autos only rose 0.3%.  USDCAD rallied from 1.2679 to 1.2729 on the news.  Prices have eased back to 1.2715 and trading nearly at a stand-still, do the USD holiday.

It is Thanksgiving Day in America.  It is the day that American’ set aside to give thanks for their blessings and Black Friday sales.

Overnight, FX trading was quiet, and the US dollar was on the defensive.  The FOMC minutes were considered “dovish” because of concerns about the risk of high asset valuations and low inflation which suggests a slower pace to rate increases in 2018.

In Asia, NZDUSD ticked higher when Retail Sales posted a 0.2% gain, supported by general US dollar weakness.  AUDUSD inched higher following the FOMC minutes.  Both currency pairs traded in narrow 0.0030 point ranges and opened this morning a tad higher comparted to the close.

USDJPY was almost unchanged but traded with a bearish bias after breaking key support at 111.60 yesterday.  Trading was extra thin as Japan was closed for a holiday.

EURUSD moved steadily higher, underpinned by the dovish FOMC minutes and better-than expected Eurozone November PMI data. Preliminary November Manufacturing PMI rose to 57.5 from 56.0 previously.

GBPUSD retreated from major resistance in the 1.3330-40 area.  Weaker than expected Q3 Total Business Investment was 1.3% vs forecast 1.4%, y/y.Q3 GDP was 0.4%, q/q, as expected.  The UK parliament will begin debating the Brexit bill on December 4.

Oil prices were steady but firm, hovering around $57.00/barrel for the session.

USDCAD dropped along with the US dollar vs. the majors after the dovish FOMC minutes.  Thin markets and firm oil prices contributed to the slide.

USDCAD Technical outlook:

The USDCAD technicals are bearish. The break below 1.2740 yesterday snapped the uptrend line that had been in place since September and targets further losses to 1.2595. the 38.2% Fibonacci level of the Sept.-Nov. range.  However, support at 1.2660 will be sticky.  A break above 1.2760 will shift the focus back to 1.2830.

Today’s Range 1.2680-1.2740

Chart: USDCAD 1 hour