GBP/USD, USD/CAD, USD/MXN – North American Session Daily Forecast
GBP/USD continues to post strong gains. In Wednesday’s North American session. Currently, the pair is trading at 1.2830, up 0.55% on the day.
Cable Surges on Brexit Optimism
The British pound surged on Tuesday, climbing an impressive 1.2%. The pound has enjoyed an excellent October, gaining 4.0%. The catalyst for this run has been the Brexit withdrawal date of October 31 and whether a deal can be made in time. The pound has soared as the markets are clearly of the opinion that an agreement can be reached and a nightmarish no-deal scenario avoided.
GBP/USD easily broke through 1.2653 on Tuesday and proceeded to test resistance at 1.2750. The trend for the pound to dollar ratio is up, and if the pair continues to move higher, it could soon set its sights on resistance at 1.2870. On the downside, there is support at 1.2585.
USD/CAD is trading sideways in Wednesday’s North American session. Currently, the pair is trading at 1.3214, up 0.07%.
Canadian CPI Beats Forecast
Canadian CPI moved closer to the Bank of Canada target of 2.0%. On an annualized basis, CPI showed a 1.9% gain, above the forecast of 1.7%. Trimmed CPI, which excludes the most volatile items which are covered in CPI, remained steady at 2.1%, on an annualized basis.
1.3240 remains an immediate resistance line and has been under pressure during the week. On the downside, the pair has tested support at 1.3200, but has not been able to push sustain downward movement below this level. I do not expect any significant movement for the remainder of the Wednesday session.
USD/MXN has recorded slight gains on Wednesday. In the North American session, the pair is trading at 19.26, up 0.11% on the day.
USD/MXN broke through support at 19.30 early in the week and is putting pressure on 19.20, which is a major support level. This line, which has remained intact since early August, could be tested during the week. On the upside, there is resistance at 19.45.