USD/CAD Open: 1.3227-31, Overnight Range: 1.3192-1.3256
WTI Oil is at $42.27 and gold is at $1,953.10. US markets are mixed today.
For today, USD resistance is at 1.3248. Support is at 1.3181.
• Greenback grinding lower on Congressional stimulus stalemate
• US weekly jobless claims in focus
• US dollar opens with losses against G-10 majors except NZD
The Canadian dollar is making a move. It is attempting to dig through significant support levels in the USDCAD 1.3190-1.3210 zone.
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If successful, it could lead to a quick plunge to 1.3100. Canadian dollar buyers are taking their lead from broad US dollar weakness against the major currencies. The weakness stems from a variety of reasons.
Traders are concerned that US economic growth will lag that of its peers, particularly in the Eurozone, especially if the government continues to delay a new stimulus package. Republicans and Democrats are deadlocked in their negotiations. Trump’s party proposed a $1.0 trillion package while the Democrats want to spend $3.5 trillion.
The US coronavirus outbreak is still causing concern. The Washington Post reported 55,400 new cases on Wednesday and that the number of deaths was rising.
President Trump isn’t concerned. He wants schools to reopen and sporting events to resume.
Trade concerns continue to linger, with the Eurozone in focus. US Trade Representative Robert Lighthizer decided to maintain the 15% tariffs on Airbus. He said: “The EU and member states have not taken the actions necessary to come into compliance with WTO decisions.”
There isn’t a lot of top tier data available today. Weekly jobless claims will get a lot of attention as the report is seen as a real-time barometer for the US economy. A steady decline in claims suggests the US economy is recovering.
The New Zealand dollar was the worst-performing G-10 currency overnight. NZDUSD continued to suffer from the dovish Reserve Bank of New Zealand outlook, which was exacerbated by a complaint about the strength of the currency. Deputy Governor Geoff Bascand made things worse when he warned that the latest coronavirus outbreak jeopardized the outlook.
AUDUSD rallied on the back of better than expected employment data. Australia added 114,700 jobs, and the unemployment rate dropped to 7.5% from 7.8%. It couldn’t hang on to the gains and AUDUSD fell to yesterday’s closing level in early Toronto trading.
Traders will be watching US equity market performance.
Today’s Suggested Range USD/CAD: 1.3180 – 1.3280
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