FX markets were lively in Asia and Europe.  US dollar bulls were in command in Asia and early European trading but were usurped by dollar bears after Eurozone data reports. The greenback opened in New York with losses across the board from yesterday’s closing levels.

EURUSD traded sideways for most of the Asia session and dropped from a peak of 1.2386 to 1.2336 just ahead of the European opening.  Shortly afterwards prices rallied and never looked back, reaching 1.2423 moments ahead of the open.  A slew of Eurozone economic reports including Q4 GDP (Actual 0.6% vs forecast 0.6%) supported  Mario Draghi’s comments, last week, about the need for cautious monetary policy.

GBPUSD cracked below 1.4000 at the European open, undermined by unflattering press reports about UK Prime Minister May’s ability to negotiate her Brexit vision through parliament.  However, the broad US dollar weakness lifted GBPUSD to 1.4108 in early New York trading.

USDJPY hit 109.19 in Asia, lifted by rising US Treasury yields but the rally was thwarted by bearish technicals leading to a probe of support in the 108.50 area.

Better than expected New Zealand Trade data (Actual $640 million vs forecast -126 million) offset early US dollar strength leaving NZDUSD rangebound until the European open.  Prices dropped from  0.7335 to 0.72280 in a temporary move that was entirely reversed by the New York start.

AUDUSD was sold after Business Confidence missed expectations, but it recovered to post a small gain by today’s open.

WTI oil traded in a $64.69-$65.53 range with traders trying to come to terms with rising US supply against global growth and Opec production cuts. Asia US dollar strength drove gold prices to a low of $1,334.76 in Asia.   That move ended and gold rallied to $1,346.06 as New York walked in.

Global equity indices are down, taking their cue from yesterday’s Wall Street losses.  Equity futures are pointing to a lower opening this morning

USDCAD rallied in Asia.  Contradicting views about the state of the Nafta negotiations that concluded in Montreal and broad US dollar strength lifted the currency pair to 1.2377.  That move was also reversed in Europe.

The only data of note is the US Case-Shiller Home Price Index (forecast 6.4%).  President Trump’s State of the Uniona address is tonight.  GBPUSD traders will be listenining closely to Bank of England Governor Mark Carney’s speech at 10:30 am EST.  There isn’t any Canadian data.

USDCAD Technical Outlook

USDCAD is rangebound inside a 1.2290-1.2390 band.  A break either side of that will extend the move another .00050-.0060 points. The short term technicals are bearish.  The down trend line from the December peak of 1.2919 is intact while prices are below 1.2450 and looking for a break of support in the 1.2240-50 area to extend losses to 1.2060.

Today’s range 1.2290-1.2380