The dollar is on the back foot this morning on confidence for a break through between China and the US. The dollar pairs are on the front foot, led by the AUD/USD which has made good yesterday’s losses on hopes for a China rebound as trade talks enter their final phase.
The EUR/USD is also on the rise, and rebounding off the 1.1300 level. The EUR/GBP is on the front foot after further volatility for the pound yesterday.
In a surprise for nobody including the EU, the UK parliament yesterday support the move to delay Brexit. Although this was exactly what markets have been betting on for some time, the GBP/USD slipped lower yesterday after failing to break through 1.3300, with follow-on selling this morning. It appears to be a classic case of “buy the rumour, sell the news”.
The USD/CAD is slipping lower on US dollar weakness and heading for support around 1.3300. The USD/CHF is also continuing its slide, trading below 1.0050 and heading for the parity line once again.
The yen pairs are mixed, with the USD/JPY slipping lower in its attempt to break through 112.00 once again. This comes after the BOJ noted weakness in exports. The AUD/JPY is nudging higher for fourth day out of five and holding the 79.00 level. The EUR/JPY is unchanged after four days of gains, while the GBP/JPY is slipping back after failing to break through the 148.00 level
Gold is attempting a rally after crashing through the $1300 level.
Today, we have Canadian Manufacturing sales at 12.30.
US preliminary UoM consumer sentiment is at 14.00.
The USD/CAD is poised for further downside and is set to break through the 1.3300 level for the first time since the beginning of the month.
With the US dollar easing off the accelerator, it could pay to bet on further downside from here.