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On January 29th, the Ministry of Commerce held a regular press conference. At the Ministry of Commerces regular press conference on December 25th last year, it was reported that TikTok had signed agreements with three investors to establish a new TikTok US joint venture to ensure its continued operation in the US. What is the spokespersons comment on this? He Yongqian stated that, in order to implement the important consensus reached during the phone call between the leaders of China and the US, the economic and trade teams of both sides had previously reached a basic framework consensus on properly resolving issues such as TikTok through cooperation, based on mutual respect and equal consultation. The Chinese government hopes that companies will reach solutions that comply with Chinese laws and regulations and balance interests. It hopes that the US will work with China in the same direction, earnestly fulfill its corresponding commitments, provide a fair, open, transparent, and non-discriminatory business environment for the continued and stable operation of Chinese companies in the US, and promote the stable, healthy, and sustainable development of China-US economic and trade relations.On January 29th, Richard Flynn, Managing Director of Charles Schwab UK, noted in a report that unless there is a substantial shift in inflation or labor market dynamics, the Federal Reserve is likely to maintain its data-driven approach until at least May 2026. However, he stated that this is an extraordinary period for US monetary policy. "The increasingly open struggle between monetary independence and fiscal power makes the Feds institutional credibility a more acute focus," he pointed out. Flynn stated that this independence remains the cornerstone of global confidence in the dollar, US Treasuries, and the broader US capital markets.On January 29th, JPMorgan Chase issued a research report stating that New Oriental Education & Technology Group Co., Ltd. (09901.HK) reported better-than-expected results for its second fiscal quarter of 2026, leading to an upward revision of its guidance for the first time in two years. Managements optimistic outlook prompted the bank to raise its operating profit forecasts for fiscal years 2026 and 2027 by 7%. The report indicated that New Oriental has returned to a high-quality compound growth trajectory and is expected to continue exceeding expectations and raising guidance. The bank reiterated its "Overweight" rating and top pick status for New Oriental, raising its target price from HK$53 to HK$55.The Norwegian Petroleum Fund: As of December 31, the funds total market value was 21.268 trillion Norwegian kroner.The Norwegian Petroleum Fund: Technology, financial, and basic materials stocks made significant contributions to the overall returns.

USD/CAD Trades at a Flat Level Following Volatile Trading and Rising US Treasury Yields

Drake Hampton

Apr 06, 2022 10:16

Insights

  • The dollar fell as additional penalties against Russia weighed on the Loonie.

  • Benchmark rates increased as the Federal Reserve pursued a more aggressive rate hike strategy.

  • Due to the new penalties, gold and silver prices remained rather stable.

  • As European countries ponder further measures, oil prices continue to rise.

 

Despite a volatile trading session, the dollar maintained its strength as higher oil prices bolstered the commodity-linked Loonie. The yield on ten-year government bonds increased to 2.56 percent, the highest level since May 2019. Benchmark rates increased several basis points following Fed Governor Brainard's statement that the Fed must pursue a more aggressive stance to contain inflation. Commodity-linked currencies such as the Loonie increased in value as a result of higher oil prices and good economic indicators. New sanctions against Russia continue to benefit silver and gold prices. On the potential of fresh Russian sanctions, oil prices continued to increase. Investors are awaiting the release of the minutes from the most recent FMOC meeting on Wednesday.

 

Today, the US released its February trade balance. Actual balance of -$89.2 billion was lower than predicted at -$88.5 billion. The reading stayed relatively stable compared to the previous month, indicating a record deficiency. Exports increased by 1.8%, while imports jumped by 1.3 percent. In the following months, the Russia-Ukraine war may limit demand for US exports.

Technical Evaluation

The USD/CAD exchange rate remained unchanged following a recovery from the downward pressure caused by increased oil prices, which supported the Loonie. However, losses should be contained as a result of the Fed's more aggressive rate hikes. The pair remains below the key level of 1.25 and may be driven lower as additional penalties against Russia increase. Resistance is located near the 10-day moving average, which is now at 1.25. Near today's lows near 1.24, support is seen. A break below support would reveal the daily low of 1.2387 from November 10th, signaling further downward pressure. The short-term momentum shifted to the upside when the fast stochastic crossed above the buy signal.

 

Although the MACD line generated a crossover sell signal, the medium-term momentum is negative but favorable. When the MACD line (the 12-day moving average minus the 26-day moving average) passes the MACD signal line, this scenario occurs (the 9-day moving average of the MACD line).

 

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