For the 24 hours to 23:00 GMT, the USD traded flat against the CAD and closed at 1.3163.

In the Asian session, at GMT0300, the pair is trading at 1.3170, with the USD trading 0.05% higher against the CAD from yesterday’s close.

The pair is expected to find support at 1.3152, and a fall through could take it to the next support level of 1.3133. The pair is expected to find its first resistance at 1.3186, and a rise through could take it to the next resistance level of 1.3201.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the AUD declined 0.14% against the USD and closed at 0.6902.

LME Copper prices rose 0.1% or $4.5/MT to $5949.5/MT. Aluminium prices declined 0.2% or $3.5/MT to $1774.5/MT.

In the Asian session, at GMT0300, the pair is trading at 0.6905, with the AUD trading slightly higher against the USD from yesterday's close.

Overnight data indicated that Australia's seasonally adjusted building approvals unexpectedly declined to its lowest level in six years by 1.2% on a monthly basis in June, compared to a revised advance of 0.3% in the prior month. Market participants had anticipated building approvals to register a gain of 0.2%.

The pair is expected to find support at 0.6896, and a fall through could take it to the next support level of 0.6886. The pair is expected to find its first resistance at 0.6914, and a rise through could take it to the next resistance level of 0.6922.

Moving forward, traders would closely monitor Australia's consumer price index for the second quarter and private sector credit for June, scheduled to release overnight.

The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

For the 24 hours to 23:00 GMT, Gold rose 0.21% against the USD and closed at USD1438.60 per ounce, ahead of the Federal Reserve’s interest rate decision.

In the Asian session, at GMT0300, the pair is trading at 1436.00, with gold trading 0.18% lower against the USD from yesterday’s close.

The pair is expected to find support at 1428.73, and a fall through could take it to the next support level of 1421.47. The pair is expected to find its first resistance at 1442.03, and a rise through could take it to the next resistance level of 1448.07.

The yellow metal is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, Silver rose 0.18% against the USD and closed at USD16.47 per ounce, tracking gains in gold prices.

In the Asian session, at GMT0300, the pair is trading at 16.45, with silver trading 0.12% lower against the USD from yesterday’s close.

The pair is expected to find support at 16.37, and a fall through could take it to the next support level of 16.30. The pair is expected to find its first resistance at 16.51, and a rise through could take it to the next resistance level of 16.58.

The white metal is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, Crude Oil rose 1.91% against the USD and closed at USD57.19 per barrel, after trade talks between the US and China resumed, renewing hopes for a near-term deal and expectations of rate cut by the US Federal Reserve in its upcoming policy meeting.

In the Asian session, at GMT0300, the pair is trading at 57.18, with oil trading marginally lower against the USD from yesterday's close.

The pair is expected to find support at 56.24, and a fall through could take it to the next support level of 55.31. The pair is expected to find its first resistance at 57.68, and a rise through could take it to the next resistance level of 58.19.

Crude oil is trading above its 20 Hr and 50 Hr moving averages.

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Daily Pivots: (S1) 1.2159; (P) 1.2272; (R1) 1.2331; More...

GBP/USD's decline continues today and accelerates to as low as 1.2119 so far, breaking 61.8% projection of 1.4376 to 1.2391 from 1.3381 at 1.2154. There is no sign of bottoming yet. Intraday bias stays on the downside for 1.1946 low next. We'd be cautious on bottoming there. But break will target 100% projection at 1.1396. On the upside, above 1.2235 minor resistance will turn intraday bias neutral and bring consolidation. But recovery should be limited by 1.2383 support turned resistance to bring fall resumption.

In the bigger picture, down trend from 1.4376 (2018 high) is still in progress and is resuming. Such decline should target a test on 1.1946 long term bottom (2016 low) next. For now, we don’t expect a firm break there yet. Hence, focus will be on bottoming signal as it approaches 1.1946. However, firm break of 1.1946 will resume down trend from 2.1161 (2007 high) to 61.8% projection of 1.7190 to 1.1946 from 1.4376 at 1.1135. In any case, medium term outlook will stay bearish as long as 1.3381 resistance holds, in case of strong rebound.

Selloff in Sterling remains the focus in Asian session today, as markets are adding their best to no-deal Brexit. The currency markets are relatively quiet elsewhere. Canadian Dollar is currently the second weakest, then Euro. Yen and Swiss Franc are the strongest, with help by falling treasury yields. Dollar is the third strongest as markets await Fed's rate cut tomorrow.

Technically, GBP/USD is in downside acceleration and should be targeting 1.1946 low next. GBP/JPY is on track to retest 131.51 low and break will resume fall from 156.96 towards 122.36 low in medium term. EUR/GBP's strong break of 0.9101 key resistance also carry long term bullish implication and the cross should target 0.9305 (2017 high). Both upside USD/CHF and USD/JPY lost upside moment ahead of near term resistance. The greenback will likely turn into consolidation first, in general, except versus Pound.

In Asia, Nikkei is trading up 0.33%. Hong Kong HSI is up 0.32%. China Shanghai is up 0.56%. Singapore Strait Times is up 0.15%. Japan 10-year JGB yield is down -0.0033 at -0.149. Overnight, DOW rose 0.11%. S&P 500 dropped -0.16%. NASDAQ dropped -0.44%. 10-year yield dropped -0.026 to 2.055.

UK Johnson: Brexit presents enormous opportunities for our country

Sterling's selloff continues today as markets are adding their bets to no deal Brexit. UK Prime Minister Boris Johnson is insisting that he could get a new Brexit deal with the EU. He said in televised comments that “we're very confident, with goodwill on both sides, two mature political entities -- the U.K. and EU -- can get this done".

And, “it's responsible for any government to prepare for a no deal if we absolutely have to. That's the message I've been getting across to our European friends. I'm very confident we'll get there.” He also insisted that the Irish backstop is "dead" along with former PM Theresa May's withdrawal agreement.

Johnson also emphasized that “Once we leave the EU on Oct. 31, we will have a historic opportunity to introduce new schemes to support farming – and we will make sure that farmers gets a better deal". And, "Brexit presents enormous opportunities for our country, and it's time we looked to the future with pride and optimism."

At this point, there is no sign of EU shifting its position yet. That is, the negotiation for the Brexit Withdrawal Agreement was closed and won't be re-opened. European Commission also indicated that while an orderly withdrawal is in everyone's interest, the bloc is well-prepared for a no-deal Brexit.

BoJ stands pat, economy to continue on an expanding trend

BoJ left monetary policy unchanged today as widely expected. Under the yield curve control framework, short-term policy interest rate is held at -0.10%. 10-year JGB yield will be held at around zero percent with JGB purchases. Monetary base will increase at an annual pace of around JPY 80T. The decisions are made with 7-2 vote with Y. Harada and G. Kataoka dissented again.

In the outlook for economic activity and prices report, BoJ said the economy is "likely to continue on an expanding trend throughout the projection period" through fiscal 2021. Exports are projected to "show some weakness" for the time being, but are still expected to be on a "moderate increasing trend". Domestic demand would "follow an uptrend" against the background of highly accommodative financial conditions and government spending.

Regarding inflation, all item CPI "continued to show relatively weak developments". But "further price rises are likely". Year-on-year rate of change in CPI is "likely to increase gradually toward 2 percent". And both growth and CPI projections are "more or less unchanged" from previous projections.

Risks to economic activity are "skewed to the downside", particularly regarding overseas developments. Risks to prices are also "skewed to the downside". The momentum towards 2% inflation target is "maintained" but is "not yet sufficiently firm".

Japan industrial production dropped -3.6% in indecisive fluctuations

Japan industrial production dropped sharply by -3.6% mom in June, much worst than expectation of -1.8% mom. That's also the largest decline since January 2018. Shipments dropped -3.3% mom while inventories rose 0.3% mom.

A Ministry of Economy, Trade and Industry said in the press briefing that the decline was a reversal of the unexpectedly strong production in the preceding months." He added, "we don't believe there is a downward trend, though there isn't an upward trend either". Production just "fluctuates indecisively".

Also from Japan, unemployment rate improved to 2.3% in June, down from 2.4%. Number of people in work hit record 67.5m. Ministry of Internal Affairs and Communications said "the jobless rate has been firm and moving narrowly at that level".

Looking ahead

Lots of Eurozone data will be featured in European session. France GDP, Germany Gfk consumer sentiment and CPI will be released. Eurozone will publish confidence indicators. Swiss will release KOF economic barometer.

Later in the day, US personal income and spending, with PCE inflation will be the major focus, together with consumer confidence. Pending home sales and S&P Case-Shiller house price will also be released.

GBP/USD Daily Outlook

Daily Pivots: (S1) 1.2159; (P) 1.2272; (R1) 1.2331; More...

GBP/USD's decline continues today and accelerates to as low as 1.2119 so far, breaking 61.8% projection of 1.4376 to 1.2391 from 1.3381 at 1.2154. There is no sign of bottoming yet. Intraday bias stays on the downside for 1.1946 low next. We'd be cautious on bottoming there. But break will target 100% projection at 1.1396. On the upside, above 1.2235 minor resistance will turn intraday bias neutral and bring consolidation. But recovery should be limited by 1.2383 support turned resistance to bring fall resumption.

In the bigger picture, down trend from 1.4376 (2018 high) is still in progress and is resuming. Such decline should target a test on 1.1946 long term bottom (2016 low) next. For now, we don’t expect a firm break there yet. Hence, focus will be on bottoming signal as it approaches 1.1946. However, firm break of 1.1946 will resume down trend from 2.1161 (2007 high) to 61.8% projection of 1.7190 to 1.1946 from 1.4376 at 1.1135. In any case, medium term outlook will stay bearish as long as 1.3381 resistance holds, in case of strong rebound.

Economic Indicators Update

Sterling's selloff continues today as markets are adding their bets to no deal Brexit. UK Prime Minister Boris Johnson is insisting that he could get a new Brexit deal with the EU. He said in televised comments that “we’re very confident, with goodwill on both sides, two mature political entities -- the U.K. and EU -- can get this done".

And, “it’s responsible for any government to prepare for a no deal if we absolutely have to. That’s the message I’ve been getting across to our European friends. I’m very confident we’ll get there.” He also insisted that the Irish backstop is "dead" along with former PM Theresa May's withdrawal agreement.

Johnson also emphasized that “Once we leave the EU on Oct. 31, we will have a historic opportunity to introduce new schemes to support farming – and we will make sure that farmers gets a better deal". And, "Brexit presents enormous opportunities for our country, and it’s time we looked to the future with pride and optimism."

At this point, there is no sign of EU shifting its position yet. That is, the negotiation for the Brexit Withdrawal Agreement was closed and won't be re-opened. European Commission also indicated that while an orderly withdrawal is in everyone’s interest, the bloc is well-prepared for a no-deal Brexit.

Japan industrial production dropped sharply by -3.6% mom in June, much worst than expectation of -1.8% mom. That's also the largest decline since January 2018. Shipments dropped -3.3% mom while inventories rose 0.3% mom.

A Ministry of Economy, Trade and Industry said in the press briefing that the decline was a reversal of the unexpectedly strong production in the preceding months." He added, "we don't believe there is a downward trend, though there isn't an upward trend either". Production just "fluctuates indecisively".

Also from Japan, unemployment rate improved to 2.3% in June, down from 2.4%. Number of people in work hit record 67.5m. Ministry of Internal Affairs and Communications said "the jobless rate has been firm and moving narrowly at that level".

BoJ left monetary policy unchanged today as widely expected. Under the yield curve control framework, short-term policy interest rate is held at -0.10%. 10-year JGB yield will be held at around zero percent with JGB purchases. Monetary base will increase at an annual pace of around JPY 80T. The decisions are made with 7-2 vote with Y. Harada and G. Kataoka dissented again.

In the outlook for economic activity and prices report, BoJ said the economy is "likely to continue on an expanding trend throughout the projection period" through fiscal 2021. Exports are projected to "show some weakness" for the time being, but are still expected to be on a "moderate increasing trend". Domestic demand would "follow an uptrend" against the background of highly accommodative financial conditions and government spending.

Regarding inflation, all item CPI "continued to show relatively weak developments". But "further price rises are likely". Year-on-year rate of change in CPI is "likely to increase gradually toward 2 percent". And both growth and CPI projections are "more or less unchanged" from previous projections.

Risks to economic activity are "skewed to the downside", particularly regarding overseas developments. Risks to prices are also "skewed to the downside". The momentum towards 2% inflation target is "maintained" but is "not yet sufficiently firm".

BoJ statement here.

Outlook for economic activity and prices report