CANADA DATA: CFIB Small Business Optimism Adds Evidence Of Solid End-2025 Growth

"*TEXAS REDISTRICTING SHOT DOWN, NARROWING GOP PATH TO GAIN SEATS" - bbg

From the Bloomberg write-up: "Texas diluted the strength of minority voters in redrawing Congressional districts, a federal judge panel ruled Tuesday, delivering a loss to President Donald Trump and closing a path to Republicans adding five more House seats next year."

From our political risk team's morning briefing: 

• Trump yesterday reiterated a threat to support primary election challenges against Indiana Republicans who vote against drawing a new congressional map that could net the GOP two additional seats in 2026. If the move is blocked by the state’s legislature, it could hand the initiative to a Democratic counter-move in Virginia.
• Trump's comments come as a pair of favorable redistricting efforts in California and Utah threaten to tip the scales in favor of Democrats, after the GOP initiated a partisan redistricting struggle with an aggressively drawn Texas map.
• The New York Times noted last week, "Republicans have had an advantage in this year's redistricting wars because they control the redistricting process in states with more Democratic-held congressional seats. But this advantage is starting to look shaky - shaky enough that it's possible to imagine how Democrats could fight the redistricting wars to a draw ahead of the 2026 midterms, and perhaps even win them by the 2028 election."

• RES 4: 1.3368 50.0% retracement of the Sep 17 - Nov 4 bear leg    
• RES 3: 1.3303 50-day EMA   
• RES 2: 1.3284 38.2% retracement of the Sep 17 - Nov 4 bear leg 
• RES 1: 1.3203/16 20-day EMA / High Nov 13
• PRICE: 1.3142 @ 16:36 GMT Nov 18
• SUP 1: 1.3085/10 Low Nov 12 / Low Nov 4 & 5 and the bear trigger 
• SUP 2: 1.2971 1.382 proj of the Sep 17 - 25 - Oct 1 price swing
• SUP 3: 1.2945 50.0% retracement of the Jan 13 - Jul 1 bull leg
• SUP 4: 1.2877 1.618 proj of the Sep 17 - 25 - Oct 1 price swing          

A key short-term resistance in GBPUSD at 1.3203, the 20-day EMA, remains intact. It has been pierced, a clear break of it would signal scope for a stronger corrective cycle and expose the 50-day EMA, at 1.3303. Moving average studies remain in a bear-mode condition and continue to highlight a dominant downtrend. A reversal would signal the end of the correction and a resumption of the bear leg. The bear trigger is 1.3010, the Nov 4 and 5 low.                   

• The Canadian dollar is notably outperforming today, allowing USDCAD to gather downside momentum below the 1.40 mark and last week’s lows at 1.3985. Spot is now testing the 50-day EMA, of which the pair has not closed below since September.
• Price action bolsters the short-term bearish outlook, as the pair continues to trade inside a bull channel drawn from the Jul 23 low. The respect of the channel top on Nov 11, and the subsequent move south highlights scope for a bear extension towards the base of the channel at 1.3893.
• It’s worth highlighting that both CADJPY and CADCHF have risen the best part of 1% on the session, bolstered by the fact that further BOC rate cuts are pretty much out of the question after October data. CADJPY has significantly narrowed the gap to the November 2023 highs at 111.56.
• Moves have been bolstered by PM Mark Carney securing passage of the first federal budget of his tenure. It is worth noting that this was by a two-vote margin, and only thanks to the backing/abstention of opposition MPs, however, it does ensure the survival of his minority government, given that federal budget votes are deemed confidence motions.
• Canada’s data calendar is relatively light this week, with September retail sales due on Friday.