MARKET DEVELOPMENT – USD/CAD Reversal, GBP/USD Rises, USD Eyes ISM Data
DailyFX 2019 FX Trading Forecasts
Canadian Dollar extends losses as external factors weigh on the currency. Yesterday’s sharp drop in both equity markets and oil prices pushed USD/CAD through the topside of its recent range of 1.3310. As such, with little on the economic calendar for Canada, external factors are likely to dictate the currency. Resistance situated at 1.3345, in which a break above opens the door for a test of 1.3380, while support resides at 1.3290-1.3300.
Sterling catches a bid throughout the European session as markets ease up on no-deal expectations following Boris Johnson’s Brexit proposals. However, with that said, hurdles remain going forward, with a high bar set for the EU to agree to Boris Johnson’s Brexit plan, current optimism could be somewhat misplaced and subsequently faded if differences persist. Elsewhere, the UK economy continues to feel the weigh of Brexit uncertainty after the latest services PMI showed a surprise contraction.
US Dollar eyes the ISM Non-Manufacturing whereby markets will look for any spill-over effects from the downturn observed in the manufacturing sector. If indeed there is notable drop in the non-manufacturing reading, risk assets are likely to remain under pressure with investors flowing into safe-havens.
WHAT’S DRIVING MARKETS TODAY
- “Gold Price Outlook: Boosted by Risk Sentiment, Eyes US NFP Report” by Nick Cawley, Market Analyst
- “FTSE 100 Price Outlook: Throttling Brings Topping Pattern into Clear View” by Paul Robinson, Currency Strategist
- “GBP/USD Price Outlook: Unfazed by PMI Warning Signal” by Justin McQueen, Market Analyst
- “Using FX To Effectively Trade Global Market Themes at IG” by Tyler Yell, CMT , Forex Trading Instructor
--- Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.mcqueen@ig.com
Follow Justin on Twitter @JMcQueenFX
