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USD threatening a still stronger tone versus GBP and CAD

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The US currency has exhibited an erratic consolidation theme versus many of the major G8/ G10 currencies since the 21st September FOMC and Bank of Japan Meetings. However, a firm US Dollar tone against both the GB Pound and the Canadian Dollar leaves risk for a more bearish GBPUSD tone and more bullish USDCAD theme into early October.

GBPUSD

A lacklustre bounce Friday to prod above resistance at 1.3000, but to then fail ahead of 1.3058 (back from 1.3032), to maintain the risk to the downside on Monday.

For Today:

  • We see a downside bias for 1.2933 and 1.2912/00; break here aims for 1.2864/1.2850 and maybe closer to the key multi-decade low at 1.2791.
  • But above 1.3032 opens risk up to 1.3058 and 1.3088.

On an intermediate-term outlook, we still see a broader range theme into mid-September.

Short/ Intermediate-term Range Parameters: We see a range defined by 1.2791 and 1.3534.

Range Breakout Challenge

  • Upside: Above 1.3534 aims higher for 1.3637 and 1.3899.
  • Downside: Below 1.2791 sees risk lower for 1.2565, 1.2000 and 1.1880.

Daily GBPUSD Chart

GBPUSD Chart

USDCAD

An erratic tone on Friday, but the rebound Thursday from ahead of 1.3034 (off of 1.3047) maintains the underlying positive bias and sees upside risks into Monday.

The risk into October remains for an intermediate-term bullish shift above 1.3296.

For Today:

  • We see an upside bias for 1. 3195/3200, 1.3280 and key 1.3296; break here aims for 1.3313 and 1.3355.
  • But below 1.3083 aims for 1.3047 and opens risk down through 1.3034, for 1.2996.

Erratic consolidation through August, a sell off, rebound and break back lower into early September has simply reinforced the broader, non-trend range theme.

Short/ Intermediate-term Range Parameters: We see the range defined by 1.2651 and 1.3296.

Range Breakout Challenge

  • Upside: Above 1.3296 aims higher for 1.3405 and 1.3500.
  • Downside: Below 1.2651 sees risk lower for 1.2457 and 1.2304.

Daily USDCAD Chart

USDCAD Chart