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Dollar strength continues to put pressure on risky assets

April 12, 2022

USD/CAD: The Canadian dollar weakened against the greenback on Monday, and the yield on benchmark government debt climbed. Canadian government 10-year bond yields rose 7 basis points to 2.7%. The yield on similar U.S. government benchmark debt rose to 2.78%.Investors expect steps from the Bank of Canada to tighten monetary policy. At the meeting of the regulator on Wednesday, the interest rate may be increased by 50 basis points, which will become a catalyst for strengthening the national currency. Immediate support is seen at 1.2600, a break below could take the pair towards 1.2500.

SELL STOP 1.2600/TP 1.2500/SL 1.2630


EUR/USD: The euro initially gained against the dollar on Monday but reversed course as investors analyzed the first round of France’s presidential election. French leader Emmanuel Macron and challenger Marine Le Pen qualified on Sunday for what promises to be a very tightly fought presidential election runoff on April 24, pitting a pro-European economic liberal against a far-right nationalist.Today, the euro may also be pressured by weak data on business optimism in Germany. Immediate support is seen at 1.0850, a break below could take the pair towards 1.0800.

SELL STOP 1.0850/TP 1.0800/SL 1.0870


GBP/USD: Sterling fell on Monday against the euro and the dollar after data showed the UK economy slowed more sharply than expected in February. Monthly gross domestic product rose by 0.1% in February, down from 0.8% growth in January. The pound is at risk of remaining under pressure amid the strengthening of the dollar. Today there will be published data on inflation in the US. Inflation is forecast to reach new highs, which could lead to significant dollar gains. Immediate support is seen at 1.3000, a break below could take the pair towards 1.2940.

SELL STOP 1.3000/TP 1.2940/SL 1.3020