Canadian Dollar Update October 8, 2019 – Canadian Dollar trading sideways
USD/CAD Open: 1.3309-1.3310 Overnight Range: 1.3287-1.3327
Oil is at $52.34 and gold is at $1,510.30. US markets are lower today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3332. Support is at 1.3294.
The Canadian dollar traded sideways in an uneventful (mostly) overnight session. FX markets saw a lot of “up and down” movement inside well-established, narrow ranges overnight. The British pound was the exception.
GBPUSD sank on rumours that German Chancellor Angela Merkel dismissed UK Prime Minister Boris Johnson’s Brexit proposals. The BBC claimed Ms. Merkel said a deal based on Johnson’s proposals was “highly unlikely.” Many skeptics believe the UK government’s account of the call is a tad less than accurate. Time is quickly running out for Britain and the EU due to the October 31 deadline, and GBPUSD will remain at the mercy of rumours.
EURUSD managed to inch higher on the back of EURGBP demand and a surprisingly robust German Industrial Production report for August, which rose 0.3% compared to -0.4% in July. EURUSD has been trapped in a 1.0950-1.1000 range for the past week. The short term technicals are bearish while prices are below the 1.1030-50 zone. Sentiment is negative due to last month’s European Central Bank (ECB) launch of a new quantitative easing program and interest rate cut.
USDJPY bounced off support in the 106.50-60 area last week but the rally met resistance at 107.50. overnight. USDJPY was underpinned by hopes for progress during the US/China trade talks that resume this week. That sentiment was called into question overnight after a US Commerce Department press release late yesterday. It said “Today, the Bureau of Industry and Security of the Department of Commerce announced that it will add 28 Chinese governmental and commercial organizations to the Entity List for engaging in or enabling activities contrary to the foreign policy interests of the United States.” Prices retreated to 106.90 in early Toronto trading this morning.
The hot and cold trade talk news took a toll on AUDUSD and NZDUSD. Those currencies were underpinned by what appeared to be a thaw in the hostile trade rhetoric which proved not to be the case. Their Asia gains were mostly reversed in Europe. The Australian dollar got a bit of a boost from the NAB Business Confidence and Business Conditions data.
Falling oil prices are hampering Canadian dollar gains. West Texas Intermediate (WTI) oil prices have declined for three weeks. Rising US production and crude inventories combined with forecasts for lower global demand have driven WTI to $51.84/barrel today from $59.60/b on September 17. USDCAD climbed from 1.3205 to 1.3340 during the same period.
Today’s Suggested Range USD/CAD: 1.3260 – 1.3360
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By KBFX | October 8, 2019 | Daily Update | 0 comments