President Trump channeled Julius Caesar last night but instead of saying “I came, I saw, I conquered” (Latin: veni vidi vici), he said “I came, I saw, I ran way.” 

Trump aborted a military strike on Iran, in mid-flight, according to the New York Times. The planned attack was in retaliation for Iran downing a US military drone which Iran claimed was in its territory.

Oil traders were relieved.  WTI oil spiked from $54.60/barrel yesterday to $57.76/b in early Asia trading.  Prices retreated to $57.19 at this mornings New York open. Gold prices soared as well, rising from $1,388.45/oz when it closed on Thursday to $1,411.73 oz in Asia. They have since retraced the entire move.

F-1 racing fans are familiar with the film “Hunt vs Lauda” the story of the racing rivalry between Austria’s Niki Lauda and Britain’s James Hunt.  The UK is riveted on the Tory leadership race, “Hunt vs Johnson.”  This time, it will be Hunt who crashes and burns.

Boris Johnson’s commanding lead over his rival weighed on GBPUSD which stropped from 1.2723 to 1.2654 this morning.

EURUSD drifted lower after June Eurozone Manufacturing PMI data was a tick lower than expected at 47.8 (forecast 48.0)  Any negative sentiment was mitigated by the rise in German Manufacturing PMI to 45.4 from 44.3 in May.

USDJPY dropped to 107.06 from 107.30 in Asia because of risk aversion selling due to US/Iran tensions.  The move was fully reversed in Europe and prices are higher than where they were at the close.  The good a bit of support from a rebound in 10-year Treasury yields from their overnight low of 2.002% to 2.038%.

AUDUSD and NZDUSD gave back Asia gains in Europe and opened at session lows.  Prices are weighed down by dovish Central Bank concerns.

USDCAD and EURUSD were the only two major G-10 currencies to start today’s session where they left off on Thursday.  USDCAD gains were stalled by the surge in oil prices and capped by bearish technicals and resistance at 1.3220.  Canada April Retail Sales are expected to rise a mere 0.2% m/m compared to the stellar 1.1% in March.  Analysts blame the drop on soft car sales.

Today’s US data includes Existing Home Sales and Markit PMI’s.  Fed Governor Lael Brainard and Cleveland Fed President Loretta Mester are speaking.  However, traders will be looking ahead to next week.  US/China trade talks are supposedly starting on Tuesday, according to the South China Morning Post.  In addition, the week is backloaded with risk from US data, month end and quarter end portfolio rebalancing flows and the G-20 meeting in Osaka.

USDCAD Techincal Outlook

The intraday and short-term USDCAD technicals are bearish. Prices are consolidating losses from the move below support in the 1.3340-60 area and bouncing between 1.3140 and 1.3240  A recovery above 1.3380 is needed to alleviate the downside pressure.   A break below 1.3120 targets 1.3080 and then 1.2990.  For today, USDCAD support is at 1.3140 and 1.3120.  Resistance is at 1.3220 and 1.3240.  Today’s Range 1.3140-1.3220

Chart: USDCAD  4 hour