Picture: Wikimedia commons
November 16, 2020
USDCAD open (6:00 am ET) 1.3117-21, Overnight Range 1.3068-1.3138
- Vaccine hopes trump rising COVID-19 cases, lifting equities
- Asia’s RECEP trade pact signing, underpins Antipodean currencies.
- US dollar drifts lower on positive risk sentiment
FX Ranges at a Glance
Source: IFXA Ltd/RP
FX Recap and Outlook: Donald Trump tweeted “I WON THE ELECTION!”, a follow-up tweet to an earlier multi-tweet rant. Where once Donnie’s tweets moved markets, today they are dismissed as the ramblings of a bitter old man railing at the injustices of the world.
Asia equity markets closed
higher. The Nikkei 225 finished with a gain of 2.05%, boosted by a 21.4% y/y rise in Q3 GDP, and the signing of the Regional Comprehensive Economic Partnership (RCEP), which brings 15 countries into the world’s largest trading bloc. China, South Korea, Australia, and New Zealand are members.
New US COVID-19 cases were a record 177,246 Friday, 167,276 Saturday, and 136,935 yesterday which should be concerning. Not to traders. Expectations of a coronavirus vaccine have overshadowed positive virus tests as traders anticipate a robust global economic rebound.
EURUSD traded sideways in Asia, then rallied when Europe opened. The gains were reversed, in part because ECB official Luis De Guindos pointed out that because of the resurgence of the coronavirus, the economic risks were tilted to the downside. EURUSD dropped from 1.1868 to 1.1836. The intraday technicals are bearish while prices are below 1.1890.
GBPUSD continues to doe the Brexit Two-Step. Prices rose from 1.3200 in Asia to 1.3241 in early European trading, before Brexit concerns knocked prices to 1.3167.
Boris Johnson’s decision to “self-isolate” is seen as hampering Brexit talks. Trade talks resume this week, but Ireland’s foreign minister noted “we are not in a good place.”
AUDUSD and NZDUSD were boosted by the improved risk sentiment tone and the news of the RCEP deal
USDCAD tracked the antipodean price action. Prices were drifting in the 1.3120, then dropped to 1.3068 in early NY trading after US equity futures surged following more coronavirus vaccine news. USDCAD traders do not appear to be concerned that a large swath of Ontario could be locked down because of rising COVID 1-9 cases.
There are not any US or Canadian economic reports today.
USDCAD Technicals: The intraday technicals are bearish below 1.3160, looking for break below 1.3050 to extend losses to 1.3005 and then 1.2950. A break above 1.3150 targets 1.3240. For today, USDCAD support is at 1.380 and 1.3040 Resistance is at 1.3140and 1.3170. Today’s Range 1.3080-1.3150
Chart: USDCAD 4 hour
Source: Saxo Bank
FX open (6:00 am EDT) High, Low, and previous close
Source: Saxo Bank
