November 26, 2020

USDCAD open (6:00 am ET) 1.3006-10  Overnight Range 1.2993-1.3012

  • Global equity indexes mixed to slightly lower
  • FOMC minutes were justifiably ignored
  • US dollar still on defensive, opens flat

FX Ranges at a Glance 

Source: IFXA Ltd/RP

FX Recap and Outlook:  It is Thanksgiving Day 2020 in America.  The excitement is infectious.  Millions upon millions travel to see friends and family.  So did the  COVID-19 virus.  Perhaps it is a Black Friday shopping strategy-eliminate the competition.

Elsewhere, global traders put their feet up.  Asia equity indexes closed on a mixed note. European bourses were flat to slightly lower, and US equity futures were flat. Gold prices ticked higher while crude retreated from its recent peak.

The FOMC meeting minutes, released yesterday, were a non-factor.  They didn’t offer anything new except to suggest improved forward guidance at the next meeting.  The US data dump was a lot of noise, although the rise in jobless claims indicates that the second wave of the pandemic may be problematic for the economy,  in the short term.

EURUSD traded quietly in a 1.1903-1.1940 range,  dropped to 1.1886 in Toronto trading, then reclaimed 1.1900.  Prices are underpinned by positive risk sentiment from the vaccine news, which suggests that a decisive break above 1.1960 opens the door to 1.2050. However, news that Germany may extend its current round of COVID-19 restrictions until January is capping gains.

GBPUSD  is trading sideways in a 1.3344-1.3397 range, with a bullish bias on hopes for a Brexit deal. Yesterday’s mini UK budget.  Both sides are saying that they won’t accept a bad deal, which is rather obvious.

USDJPY is trading at the bottom of its 104.23-104.46 rang.  The technicals are bearish below 105.20, looking for further losses to 103.10.

AUDUSD and NZDUSD are bid on expectations for a  vaccine-fueled, global economic rebound.

WTI oil prices are consolidating gains in a $44.60-$46.20 range that has held since Tuesday. Hopes for a increased global demand,  and  reports that Opec will extend production cuts are supporting prices.

USDCAD is trading with a negative bias after breaking below support in the 1.3030-50 area this week.  The losses are due to broad US dollar weakness from expectations for a vaccine-fueled,  global economic rebound.  The surge in crude prices is oiling the way.

The S&P 500 is up 11%, month to date.  Those gains suggest portfolio managers need to sell USDCAD to rebalance for month-end.

FX markets should be quiet as there are not any economic releases, and US markets are closed.

USDCAD Technicals:   The intraday USDCAD technicals are  unchanged.  They are bearish below 1.3030, looking for a break of 1.2990, extending losses to 1.2950.  A  decisive breech of 1.2950 opens the door to  a test of support at 1.2735. For today, USDCAD support is at 1.2990 and 1.2950.  Resistance is at 1.3030 and 1.3060. Today’s Range 1.2950-1.3020

Chart: USDCAD daily

 Source:  Saxo Bank

FX open (6:00 am EDT) High, Low, and previous close

Source:  Saxo Bank