Canadian Dollar Update January 21, 2020 – Canadian Dollar marginally softer
USD/CAD Open: 1.3047-1.3048, Overnight Range: 1.3044-1.3077
Oil is at $58.28 and gold is at $1,552.20. US markets are lower today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3081. Support is at 1.3033.
The Canadian dollar is trading marginally weaker compared to yesterday’s Toronto closing level. However, it remains locked into the narrow USDCAD trading band of 1.3030-80, that has contained price action since January 13. That may change tomorrow after the Bank of Canada interest rate decision and the release of the quarterly Monetary Policy Report (MPR).
The Canadian dollar opened in Toronto near its overnight peak, weighed down by another drop in oil prices. Yesterday’s concerns about supply shortages from the shutdown of Libya production was replaced by fears that crude oil supplies outstrip demand.
EURUSD ignored a threat by US Treasury Secretary Steven Mnuchin and squeezed higher. Mr. Mnuchin warned that European countries would have tariffs placed on them if they continue to tax digital companies. France already crumbled and said they had “suspended” their planned tax. EURUSD got a boost from better than expected Eurozone and German ZEW Surveys which were better than expected. The ZEW institute attributed the gains to the settlement of the US and China trade dispute.
GBPUSD rallied on the back of strong UK employment data. The UK showed the best job growth in a year, which occurred even as the UK economy was slowing. The employment results reduced the odds that the Bank of England would cut interest rates on January 30, which powered GBPUSD to 1.3063 from 1.2997.
President Trump’s speech from the World Economic Forum in Davos didn’t have an impact on FX markets. His complaint that the Fed hiked rates unnecessarily and then cut them too slowly was ignored as it was old news.
The US and Canadian economic calendars are light, suggesting another day of range trading.
Today’s Suggested Range USD/CAD: 1.3000 – 1.3100
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By KBFX | January 21, 2020 | Daily Update | 0 comments