Canadian Dollar and Mexican Peso faced sharp declines after US President-elect Donald Trump announced plans for aggressive trade measures targeting Canada, Mexico, and China.
Trump stated that on January 20, as one of his first Executive Orders, he will authorize a 25% tariff on “all products” imported from Canada and Mexico. The tariffs will remain in place “until such time as drugs, in particular Fentanyl, and all illegal aliens stop this invasion of our country” through what he termed “ridiculous open borders.”
China is also in Trump’s crosshairs, with plans for an additional 10% tariff on top of existing levies, aimed at combating the “massive amounts of drugs” flowing into the US from the region.
Technically, USD/CAD’s up trend resumed by breaking through 1.4104 resistance. Further rise is now expected as long as 1.3930 support holds even in case of retreat. Next target is 61.8% projection of 1.3418 to 1.4104 from 1.3930 at 1.4354.
AUD/USD also dipped notably but stays above 0.6440 support so far. Further decline is expected as long as 0.6549 resistance holds. Decisive break of 61.8% projection of 0.6941 to 0.6511 from 0.6687 at 0.6421 will resume the fall from 0.6941 to 100% projection at 0.6257 next.
