Forex 4 minutes to read

NY Open: Oil price collapse sinks Loonie

Summary:  The Canadian dollar is taking the honours for being the worst performing G-10 major currency against the US dollar since yesterday’s New York close and for the week, as well.


Concerns about the ratification of the new US-Mexico-Canada trade agreement, USMCA, pummelled the Canadian dollat, as did a steep drop in oil prices and news that a US judge blocked progress on the Keystone XL Pipeline. A Canada-wide postal strike has prevented traders from seeking solace in newly legalised cannabis because it is only available by mail. USDCAD is trading at the top of its overnight range and threatening to test resistance at 1.3250.

Oil prices are leaking lower due to fears of slowing global growth, the US waivers allowing eight countries continue importing Iranian oil for a while, plus a surge in US oil production to 11.3 million barrels per day. WTI is trading just above the overnight low of $59.35/barrel.

Wall Street is in the red. The 2.4% drop in WTI oil prices overnight and weak China data spooked traders into selling to protect this week’s gains. The Federal Open Market Committee statement reminded traders that US rates were going higher in December and then probably every quarter next year as well.

Back to economic basics 

Hard economic data will be in the driver’s seat next week, although political drama will be lurking in row two, rather than at the back of the bus. 

Markets get a healthy dose of top-tier data beginning on Tuesday when German CPI, ZEW Sentiment survey and UK employment data are available. The unemployment rate is expected to be unchanged at 4%, but there is an upside risk to Average Earnings.

Tuesday is also the day Italy is supposed to present a revised budget to the European Union. Italy is expected to ignore the demand.

Wednesday has the potential to be the most volatile day. Asia has Australia Consumer Confidence, China Retail Sales, and Industrial Production. In Europe, German and Eurozone GDP will rival UK Inflation for prominence. Thursday, AUDUSD may get another boost from a robust employment report while US Retail Sales expectations should underpin the US dollar.
USDCAD 4-hour chart. (source: Saxo Bank)
Disclaimer

Saxo Capital Markets (Australia) Pty Ltd prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Combined Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Pty Ltd.
Level 25, 2 Park Street
NSW 2000
Sydney
Australia

Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Pty Ltd ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Combined Financial Services Guide & Product Disclosure Statement to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as CFDs and Margin FX products may result in your losses surpassing your initial deposits. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.
Please click here to view our full disclaimer.