Forex news for North American trading on June 1, 2020
- US Congressional Budget Office says economy could take 10 years to catch up after coronavirus
- Gov. Cuomo: New York City will have a curfew
- WTI crude oil futures settle at $35.44
- If ultra-low interest rates may drive higher savings then central banking needs a re-think
- Trump to Governors: They are making themselves look like fools
- European equity close: Another day of gains
- Momentum grows in Congress to hash out more stimulus before recess - report
- Why US protests are weighing on the US dollar
- US May ISM manufacturing index 43.1 vs 43.7 expected
- US construction spending for April month -2.9% vs. -7.0% estimate
- US May final Markit PMI 39.8 vs 40.0 expected
- Canada Markit manufacturing PMI for May 40.6 vs. 33.0 last month
- Study of Gilead's remdesivir shows improvement in moderate cases
- The AUD is the strongest and the USD is the weakest as NA traders enter for the day
The USD was hit while the risk on currencies rose (AUD, CAD and NZD). Anxiety about US China relations at the little on Friday and that feeling rolled over into the new trading week. There may also have been some USD selling as a result of the response to the George Floyd killing and subsequent weekend riots. Finally, hopes that the global recovery is underway from the coronavirus shut down helped to support the riskier currencies (and flow out of the safe havens like the USD and the CHF).
Below are the rankings of the major currencies calculated by accumulating the percentage changes of each major currencies vs. each other. The AUD was the strongest of the majors followed by the CAD and NZD. The US dollar was the weakest followed closely by the CHF. The AUDUSD was the biggest percentage mover with a gain of 1.93%.
From a fundamental perspective today the data was mixed but still reflective of the weakness from the coronavirus shut down.
- Construction spending for April fell by -2.9% vs. -7.0% estimate. However the prior month was revised to unchanged from +0.9% Nevertheless, the data although down was still better than the the expectations
- ISM manufacturing came in better than April at 43.1 vs. 41.5 last month. However the index was lower than the estimate of 43.8. New orders did rise vs. April to 31.8 from 27.1. Employment also was better at 32.1 vs. 27.5 last month.
- Canada Markit manufacturing PMI for May can better 40.6% vs. 33.0 last month. Like the US data although better than expectations is still points toward contraction in the Canadian economy
in other markets:
- Spot gold rose by $9.02 or 0.52% at $1739.25
- WTI crude oil futures are trading up $0.08 or 0.23% at $35.57
Technical levels of significance as we enter into the new trading day are showing:
- EURUSD: The EURUSD it is trading in an upward sloping channel. The lower trend line 1.1119 (and moving higher). Should support hold against that trend line getting above the high from Friday at 1.11465 and 1.11532 would be open the door for more upside momentum. On the downside a move below would have traders looking toward the swing low from Friday afternoon at 1.10802 followed by the rising 100 hour moving average at 1.10555. The price last traded below the 100 hour moving average back on May 26.
- GBPUSD: The GBPUSD moved above its 50% retracement of the range since December high. That level comes in at 1.24611. The current price is trading at 1.2489. A move below 1.24611 would be needed to hurt the bullish bias in the pair. On more upside momentum, the 1.25730 level is home to its 100 day moving average since March 10.
- USDCAD: The USDCAD fell below a lower trendline around the 1.3645 level in the NY session and downside momentum continued. The low price extended to 1.3557, nearly 100 pips from that break level. On the downside there is a price gap starting at 1.35169 and moving down to 1.34635. The price low today at 1.3557 is within 40 pips of that upper gap area.
