FX Trader, Loonieviews.net
Summary: A President Trump tweet sent the US dollar soaring overnight and New York traders added to the gains this morning. Global equity markets sank, oil prices plunged and safe-haven currencies are in demand. Then again, it may all be a mirage.
Arguably, Trump is grandstanding and giving the media something to write about on a slow news day. Treasury Secretary Mnuchin indicated good progress was made and last week suggested that the trade talks were on their final laps. So far, China’s 100-strong trade delegation is still coming to Washington for talks on Wednesday.
USDCAD rallied from 1.3421 at Friday’s close to 1.3491 this morning on the back of broad US dollar moves and a steep plunge in oil prices. WTI oil, at $61.68 is well-above its session low of $60.07, but USDCAD has ignored that rally. USDCAD is highly correlated with the US dollar Index. That correlation broke down on Friday but may be getting ready to re-correlate. If so, USDCAD may stay below resistance at 1.3490, and retreat to 1.3420.
Not surprisingly, Wall Street has taken it on the chin this morning. The three major indices are down about 1.3% in early trading. There isn’t any US data available to offset trade war jitters leading to some profit-taking.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.