Trade-War Fears Persist, CAD Slides After BoC Decision

Equities and Bond Yields Continue to Slide

The dollar continued trading higher against most of the other G10 currencies on Wednesday and during the Asian morning Thursday. It underperformed only against SEK, while it traded virtually unchanged versus AUD.

DAX 30 — Technical Outlook

The DAX 30 index took another hit yesterday, after breaking its medium-term upwards moving trendline taken from the low of December. But the German index, once again, managed to find good support near the 11810 hurdle, marked by the low of May 13 th. This area now becomes an important support zone, which if broken could open the door to further declines. This is why we will remain cautiously bearish and wait for a confirmation break below that zone, before we get excited about the downside again.

BoC Holds Rates and Guidance Unchanged

Yesterday, apart from developments and headlines surrounding the US-China sequel, CAD-traders had to deal with the BoC rate decision as well. The Bank kept interest rates unchanged at +1.75%, while the statement may have not been as upbeat as some may have expected, and thus, the Loonie slid.

CAD/CHF — Technical Outlook

After a strong reversal to the downside on May 1 st, CAD/CHF drifted lower, trading below a short-term tentative downside line drawn from the high of that reversal day. Recently, the pair established a new support zone, at 0.7433, which held the rate twice from falling. Although we saw a good rebound from that zone, still, CAD/CHF is struggling to form a higher high. But before getting comfortable with the downside again, we would like to see a break below the 0.7433 hurdle first, hence why we will stay somewhat bearish for now.

As for Today’s Events

Today, it is Ascension Day in Switzerland, Sweden and Norway, and therefore, the respective markets will be closed.



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