Photo: Wikimedia

December 23, 2020

USDCAD open (6:00 am ET) 1.2869-73,  Overnight Range 1.2868-1.2913

  • Trump demands COVID-19 Relief bill changes-threatens not to sign
  • Frances eases UK travel ban
  • US Durable Goods Orders and Jobless Claims data beat forecasts

FX Ranges at a Glance:  

Source: IFXA Ltd/RP

FX Recap and Outlook:  US weekly jobless claims only rose 803,000 compared to forecasts for an increase 0f 885,000 and better than last week’s upwardly revised result of 892,000.  Durable Goods Orders rose 0.9% in November (forecast 0.6%), the seventh consecutive increase. 

Canada GDP rose 0.4% in October, the sixth consecutive gain.  Statistics Canada noted that total economic activity is about 4% below February’s pre-pandemic level.

Overnight price action suggests that global markets are in full-bore Christmas mode.  Asia equities closed with small gains, and European stocks are higher, except for the UK FTSE100, which is flat. S&P 500  futures are pointing to a positive open on Wall Street.  Gold squeezed out a small gain, and WTI oil prices are firmer.  None of the markets traded with any enthusiasm.

President Trump did his part to spark market volatility.  He called the 5,000-page COVID-19 Relief bill “ “a disgrace,” and suggested he wouldn’t sign it.  Mr Trump claims the bill includes all kinds of money for special interest groups, foreign countries, even money to count fish.  He claims the bill allows family members of illegal immigrants to get up to $1,800 each, while “hard-working American’s only get $600. He is demanding that lawmakers provide $2,000 per person.

EURUSD traded with a mild bid, rising from 1.2155 to 1.2200, but well-above Monday’s low of 1.2130.  The ongoing Brexit talks, and tightened coronavirus measures in many regions of Europe are limiting gains.  However, France reportedly eased restrictions to allow UK freight traffic to resume.   The  short term EURUSD technicals are bullish above 1.2140.

GBPUSD continued to climb after touching 1.3310 yesterday, touching 1.3470 in NY trading.  Prices recovered on news that France is allowing UK freight traffic, with additional support derived from hopes for a last-minute Brexit deal.

USDJPY traded in a 103.36-103.64 band.  Trump’s comments suggesting he would delay the latest COVID-19 Relief bill may have encouraged modest safe-haven demand for yen.

AUDUSD and NZDUSD rallied on the back of modestly firmer commodity prices, and broad, but minor,  US dollar selling pressure.

USDCAD was collateral damage yesterday, climbing to 1.2931, due to broad-based US dollar demand.  Prices retreated steadily overnight, dropping to 1.2868, tracking antipodean price action, while being undermined slightly by a rebound in WTI oil prices.

NOTE:  There will not be an AgilityForex update tomorrow.  Next update is December 29

USDCAD Technicals:   The  USDCAD downtrend from its March peak is intact while prices are below 1.3040, and looking to extend losses on a break below the triple-bottom in the 1.2680-90 area.  The intraday technicals are bearish below 1.2970.   For today, USDCAD support is at 1.2830 and 1.2800.  Resistance is at 1.2905 and 1.2950. Today’s Range 1.2830-1.2930

Chart: USDCAD daily

 Source:  Saxo Bank

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

Source:  Saxo Bank