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March 25, 2021

USDCAD open (6:00 am ET) 1.2568-72,  Overnight Range 1.2563-1.2588,  Close 1.2584

FX Ranges at a Glance 

Source: IFXA Ltd/RP

FX Recap and Outlook: 

The outperformance of the US economy against Europe and Canada was on full display today.  Q4 Real GDP grew at a 4.3% y/y pace, well-above the forecast of 4.1%.  The news is rather stale, and the US dollar reaction was muted.

Weekly Jobless Claims were 684,000, a decline of 97,000 from last week.

The overnight session was uneventful   Asia equity markets traded flat to higher but European bourses are sharply lower as are S&P 500 futures.  The major Chinese indexes were flat.  European bourses are trading in the red while S&P 500 futures are a tad higher.  Gold prices continue bounced either side of  $1,730.00.  Oil price have added to overnight losses while 10-year Treasury yields inched down to 1.605%.

Traders are nervous over talk that the Democrats are discussing a 35% corporate tax and adding a surtax to estates.

Bitcoin (BTCUSD) gave back gains generated when Tesla said it would accept the cryptocurrency as payment.  Prices dropped from $57,225.30 to  $50,458.10 this morning

EURUSD drifted in a 1.1797-1.1827 range.  Prices are weighed down by this morning’s US economic data, and bearish technicals.  COVID-19 vaccine export controls are a topic of discussion at today’s EU Summit meeting  The EU leadership will discuss ways of  expropriating vaccines which are contracted for delivery to non-EU countries. The EURUSD technicals are bearish below 1.1850, looking for a test of 1.1740

GBPUSD  traded in a 1.3672-1.3730 range, reaching the top in early NY trading.  Prices were underpinned by comments from Bank of England Chief Economist Andy Haldane predicting a robust economic recovery driven by consumers.

USDJPY is at the peak of its 108.74-109.16  overnight range, supported by broad US dollar strength, Japanese year end flows, while ignoring soft Treasury yields.

AUDUSD and NZDUSD rallied then retreated and are back to just above yesterday’s NY closing levels. Optimistic-sounding comments by RBA Deputy Governor Guy Debelle are being ignored.

WTI oil prices churned in a $59.68-$60.83/barrel range.  Prices are supported by expected supply disruptions from the grounded tanker in the Suez, but an increase in US crude inventories and the latest coronavirus outbreak in Europe are capping gains.

USDCAD continues to drift in a 1.2520-1.2620 range, with sentiment driven by broad US dollar moves and oil prices.

Traders are looking ahead to a speech by Fed Vice Chair Richard Clarida and President Biden’s press conference today.

USDCAD Technicals:  The intraday technicals  are bullish inside a minor uptrend channel between 1.2550 and 1.2620.  For today, support is at 1.2550 and 1.2520. Resistance is at 1.2610 and 1.2640. Todays Range 1.2540-1.2620

Chart: USDCAD 4 hour

Source:  Saxo Bank

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

Source:  Saxo Bank