Canadian Dollar Update February 11, 2020 – Canadian Dollar at risk
USD/CAD Open: 1.3316-1.3317, Overnight Range: 1.3276-1.3320
Oil is at $50.28 and gold is at $1,566.30. US markets are higher today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3310. Support is at 1.3262.
Canadian Finance Minister Bill Morneau taxed his brain and concluded that the coronavirus could have an impact on the Canadian economy.
The Canadian dollar continued to ignore domestic developments and tracked broad US dollar sentiment. That sentiment shifted slightly with the greenback giving back a small part of yesterday’s gains. Asia equity indexes closed on a mixed note. The Nikkei 225 dropped slightly, while the Hong Kong and Shanghai indexes rose. European equity indexes made new record highs and US futures suggest another positive opening for Wall Street.
The only concern is how Fed Chairman Jay Powell will answer coronavirus questions during his congressional testimony today and tomorrow. The text of the Fed’s Monetary Policy Report was released earlier. It echoed the outlook from the December and January Federal Open Market Committee meetings.
The US dollar opened on a mixed note this morning, after closing with gains across the board, yesterday.
EURUSD is suffering in early Toronto trading and is at its overnight low of 1.0906. Political turmoil inside Germany’s ruling CDU party, accelerated losses below support at 1.0940 on Monday, and the single currency has yet to recover. Bearish EURUSD sentiment from US economic outperformance compared to the Eurozone fueled earlier selling and that sentiment worsened as President Trump is talking about Eurozone trade.
There was a lot of economic reports released in the UK today. Q4 GDP was unchanged, the trade surplus widened, but Industrial and Manufacturing production slumped. The data sparked a mild bout of profit-taking and GBPUSD climbed to 1.2940 from 1.2896.
AUDUSD and NZDUSD opened in Toronto with small gains. NZDUSD traders are biding their time until the Reserve Bank of New Zealand monetary policy statement is released tomorrow. Expectations are for unchanged rates and a steady policy outlook.
The US and Canadian economic calendars are empty today, leaving Canadian dollar direction at the mercy of broad US dollar moves.
Today’s Suggested Range USD/CAD: 1.3270 – 1.3370
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