 Commodity currencies are trading broadly higher today as risk appetite is lifted by optimism over US-China trade negotiations in Beijing. Canadian Dollar is additionally supported by rally in oil price, with WTI breaking 50 handle. On the other hand, Yen is trading as the weakest one, followed by Swiss Franc and Dollar. Euro is not too far away. BoC rate decision will be a bit of wild card today. While it's expected to keep monetary policy unchanged, it's far from being certain. And the new economic projections might not be as dovish as expected. Technically, USD/CAD's decline from 1.3664 is in progress for next near term fibonacci level at 1.3118. While the fall is steep and deep, it's too early to declare medium term bearish reversal yet. Reactions to 1.3118 might provide some clues though. Yen crosses are starting to lose upside momentum, as most apparently in EUR/JPY and GBP/JPY. 122.84 and 136.61 minor support levels will possibly be back in focus today. EUR/USD, GBP/USD and USD/CHF are stuck in tight range. Dollar tried to rebound with treasury yield overnight but couldn't sustain. 0.9789 in USD/CHF, 1.1499 in EUR/USD and 1.2814 in GBP/USD will be watched as sign of renewed Dollar weakness. In other markets, DOW closed up 1.09% overnight at 23787.45, slightly above 23713.93 fibonacci level. Similarly, S&P 500 also closed up 0.97% at 2574.41, also above equivalent 2573.61 fibonacci level. NASDAQ rose 1.08% but is kept below 6932.44 fibonacci level. 10 year yield rose 0.034 to 2.718, back above 2.7% handle. In Asia, Nikkei is currently up 1.25%. Singapore Strait Times is up 1.11%. Hong Kong HSI leads the rally and is up 2.68%. China Shanghai SSE is up 1.67%. Japan 10-year JGB yield is up 0.0341 at 0.032, back positive again. Overall developments are positive. |
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