Fed Chair Jerome Powell parroted the recent Yellen mantra for “gradual” rate hikes which didn’t tell markets anything that they didn’t already know. Durable Goods Orders did. They were weaker than expected, sinking 3.7% in January (forecast -2.0%) However, Durable Goods data is known for being volatile, so the impact on FX markets was fleeting. The US dollar is sneakily bid because of expected demand for month-end portfolio rebalancing purposes.
In Asia, USDJPY traded quietly in a 106.798-107.09 range. NZDUSD got a bit of a beating after New Zealand reported weaker than expected trade numbers. The Trade deficit widened to $3.22 billion (forecast $2.71 billion.. NZDUSD fell from 0.7315 to 0.7276. AUDUSD drifted lower in a tight range.
EURUSD remained locked in a 1.2310-45 band. Eurozone Economic Sentiment and Climate indicators were a tad higher than expected while Confidence was a tick lower. Traders ignored hawkish comments from ECB member and Bundesbank President Jens Weidmann saying that he could see a rate hike in 2019.
Sterling is consolidating losses from yesterday’s 1.4065 peaks, in a 1.3946-94 band. With month end concerns and Brexit issues hanging over the currency pair.
Asia equity indices were higher while European indices and US equity futures lower. Oil prices are a tad softer as well
USDCAD had an uneventful overnight session but climbed to 1.2732 after this morning’s data. USDCAD traders are not likely to get excited about tonight’s Federal Budget
USDCAD Technical outlook:
The intraday USDCAD technicals are bullish above 1.2630 looking for a break of resistance in the 1.2730-70 area to target 1.2915. A break below 1.2630 would re-test support in the 1.2500-1.2540 a zone nd suggest further 1.2500-1.2700 consolidation. For today,. USDCAD support is at 1.2630 and 1.2610,. Resistance is at 1.2730 and 1.2750
Today’s Range 1.2650-1.2730