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Canadian Dollar Update June 24, 2019 – Canadian Dollar pumped by oil

USD/CAD Open: 1.3198-1.3199 Overnight Range: 1.3177-1.3225

The Canadian dollar was rangebound in overnight currency exchange markets. Oil is at $57.95 and gold is at $1,410. US markets are higher today.

The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3223. Support is at 1.3169.

The Canadian dollar recovered all of Friday’s losses overnight, thanks to another surge in West Texas Intermediate (WTI) oil prices. Crude is in demand ahead of new US sanctions against Iran, which President Trump tweeted said would be announced today.

The Canadian dollar is also benefiting from Fed Chair Jerome Powell’s shift to a dovish monetary policy stance. The market is pricing two US rate cuts in 2019 with the first cut occurring next month. President Trump’s ongoing haranguing of Mr. Powell and the Fed’s policy stance may have contributed to Powell’s change of tone.

The Fed isn’t the only central bank considering new monetary policy stimulus. European Central Bank President, Mario Draghi, repeated his warnings that the ECB would fight stubbornly low inflation with “all the flexibility in our mandate”. EURUSD traders seem to be ignoring Draghi’s comments as EURUSD continued to climb steadily. Prices rallied from 1.1185 last Tuesday to 1.1394 in Toronto trading today.

FX markets are looking forward to the Osaka G-20 Summit and President Trump and Chinese President Xi Jinping’s meeting. The two world leaders are expected to facilitate the US/China trade talks which resume on Tuesday with US Trade Representative Robert Lighthizer and Treasury Secretary Mnuchin attending. Traders are hoping that both sides compromise and hammer out the framework of a deal.

The US dollar began this week’s trading session on the defensive as Toronto markets opened. The major G-10 currencies added to gains made on Friday, led by the Australian dollar, which gained 0.38%. The Japanese yen was unchanged from Friday’s closing level. NZDUSD traders are awaiting the Reserve Bank of New Zealand monetary policy meeting on Wednesday, even though rates are expected to be left unchanged.

There are not any US or Canadian economic reports on tap today.

Today’s Suggested Range USD/CAD: 1.3150 – 1.3250

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By KBFX | June 24, 2019 | Daily Update | 0 comments

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