USD/CAD: Canadian dollar soared on higher oil and higher US bond yields

CAD soared on broader USD weakness, higher bond yields.
CAD is also being helped by rebound in oil today.

USD/CAD is now trading around 1.25200 in New York session, tumbling by almost 0.60% and near a day low on broad weakness in greenback as US10Y bond yield has soared above 2.90% after upbeat US CPI today.

Although US stock market (SPX-500) is still resilient and surged by over 1% to 2688 from earlier post-CPI panic low of 2627 on VIX option (derivatives) expiry & regulatory probe factor, market may be concerned that higher US bond yields will be ultimately bad for overall economy and equities.

CAD is also being supported by higher oil pricestoday, being a commodity-related currency. Also, BOC (Bank of Canada) may be the most hawkish central bank after Fed in G-10 universe and coupled with that overall solid Canadian economic data has made the CAD stronger today, despite concern of a NAFTA derailment.

Technical view:

Price action suggests that USDCAD has to sustain above 1.2711 for any further rally, otherwise sustaining below 1.2688, it will again fall to 1.25310-1.22490 area in the coming days.

EUR/USD weakens below 1.1700 as Middle East tensions drive US Dollar strength

The EUR/USD pair trades with mild losses around 1.1685, the lowest since late January, during the early Asian session on Tuesday. The US Dollar gathers strength against the Euro as escalating tensions in the Middle East boost safe-haven currencies. The preliminary reading of the Harmonized Index of Consumer Prices from the Eurozone will be published later on Tuesday.

GBP/USD hits new yearly lows near 1.3300

GBP/USD adds to the recent bearish tone, approaching to the key 1.3300 support to reach fresh YTD troughs against the backdrop of the robust performance of the US Dollar. Indeed, Cable’s decline comes amid the firm demand for the safe-haven space in the wake of the US and Israel attacks to Iran.

Gold clings to gains as US-Iran conflict continues to underpin safe-haven assets

Gold retains positive bias for the fifth consecutive day on Tuesday as rising geopolitical tensions in the Middle East continue to underpin safe-haven assets. However, a bullish US Dollar could keep the bullion below its highest level since late January, set on Monday, warranting caution before positioning for any further appreciation.