Currency markets are experiencing relatively violent reactions to the events of the past 10 days. The U.S. dollar has taken out the September low, falling to levels not seen since 2022. Alternate currencies have gained significantly along with precious metals. Gold is trading up to another record high of $5,190/ounce. The rally in the Canadian dollar is the most relevant here.
To be clear, this is in NO way a political statement, just an attempt to make sure readers are aware.
The first image is the 60-minute chart of the U.S. dollar showing the selloff that began ahead of the Davos meetings when the fixation on Greenland was reaching its peak. The selloff accelerated with Trump's speech and Board of Peace introduction, neither of which were well received (to put it mildly). The gap lower was the result of the unfortunate events of the past weekend which led to an acceleration lower as support levels were violated. That was followed by Trump confidently replying to reporters that he was happy with the dollar's performance.
The second chart is the long-term weekly chart of the U.S. dollar showing the violation of support at the September low and the gap from the weekend. What it doesn't show is the fact that the currency had traded as low as 80 as recently as mid-2014, so this could be the start of a more significant decline.
The third is the monthly Canadian dollar chart showing the range we have been trading in for a decade now and more importantly, the triple bottom at 68 cents. Given our precious metal and energy resources (among too many other valuable assets to mention), a target of 98 cents/USD from the triple bottom would be reasonable. For those that would be adversely impacted, risk management strategies may be worth looking more closely at.
To be clear, this is in NO way a political statement, just an attempt to make sure readers are aware.
The first image is the 60-minute chart of the U.S. dollar showing the selloff that began ahead of the Davos meetings when the fixation on Greenland was reaching its peak. The selloff accelerated with Trump's speech and Board of Peace introduction, neither of which were well received (to put it mildly). The gap lower was the result of the unfortunate events of the past weekend which led to an acceleration lower as support levels were violated. That was followed by Trump confidently replying to reporters that he was happy with the dollar's performance.
The second chart is the long-term weekly chart of the U.S. dollar showing the violation of support at the September low and the gap from the weekend. What it doesn't show is the fact that the currency had traded as low as 80 as recently as mid-2014, so this could be the start of a more significant decline.
The third is the monthly Canadian dollar chart showing the range we have been trading in for a decade now and more importantly, the triple bottom at 68 cents. Given our precious metal and energy resources (among too many other valuable assets to mention), a target of 98 cents/USD from the triple bottom would be reasonable. For those that would be adversely impacted, risk management strategies may be worth looking more closely at.