FED: Inter-Meeting Fed Speak: Wait-And-See (3/3)

• RES 4: 1.4700 Round number resistance
• RES 3: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
• RES 2: 1.4452/4543 High Mar 13 / 4 and a bull trigger
• RES 1: 1.4415 Intraday high 
• PRICE: 1.4313 @ 16:08 BST Apr 1
• SUP 1: 1.4309 Low Apr 01 and a key support  
• SUP 2: 1.4151 Low Feb 14
• SUP 3: 1.4107 50.0% retracement of Sep 25 ‘24 - Feb 3 bull run
• SUP 4: 1.4011 Low Dec 5 ‘24

USDCAD traded sharply lower into the close, erasing much of the week’s early gains. This puts prices through the 50-day EMA support and makes for a 100 pip drop off the intraday high. A return lower and clearance of 1.4235, the Mar 26 low, would undermine the bull theme and highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. Moving average studies, however, continue to highlight a dominant uptrend - and a stronger rally would refocus attention on the bull trigger at 1.4543, the Mar 4 high.

The Chicago Fed's preliminary CARTS (Chicago Fed Advance Retail Trade Summary) report out today estimates a pickup in US ex-auto retail and food services sales in March to 0.7% M/M SA, from 0.3% prior. 

• This comes despite a 0.4% W/W decline in the last week of March, following on from a 0.6% decline the prior week - given a very strong opening to the month (the 2nd week saw sales rise 1.1%). These figures roughly collaborate the trajectory seen in in March's Johnson Redbook retail data.
• This is scheduled to be updated a day before the March Census Bureau retail sales releast (on Apr 16). Per the Chicago Fed, "The index summarizes weekly data on retail transactions & foot traffic, gasoline sales, and consumer sentiment, and is used to project current monthly retail & food services sales ex. auto."
• While most indicators of retail sales so far look solid in March, we take this release with some skepticism: CARTS missed the mark badly in February, estimating an 0.8% M/M decline in ex-auto retail sales, vs the +0.3% actual reading  (which was in line with consensus).

• Treasury futures are holding decent gains after the bell, off mid-morning highs as accounts square positions ahead of Wednesday afternoon's reciprocal tariff announcement from the White House (1600ET est).
• Washington Post reports that "White House aides have drafted a proposal to impose tariffs of around 20 percent on at least most imports to the United States, three people familiar with the matter said".
• Early FI support after mildly higher than expected S&P Mfg PMI data, lower than expected JOLTS job openings, quits and layoffs higher than expected. ISMs mixed with Mfg, new orders and employment lower than expected while prices paid jumped.
• Tsy Jun'25 10Y contract trades 111-23.5 (+16.5), off earlier high of 111-30.5, just shy of technical resistance at 112-01 (High Mar 4 and a bull trigger). Curves bull flattened off early week highs: 2s10s -2.766 at 29.033, 5s30s -1.289 at 60.651.
• Cross asset update, Bbg US$ index -0.88 at 1273.42, Gold retreats to 3117.09 (-6.50) after making new highs around 3148.0, crude retreating (WTI -.23 at 71.25.).
• Aside from tomorrow's tariff announcement, midweek data includes ADP Employment Change at 0815ET, Factory & Durable goods Orders at 1000ET, while Fed Gov Kugler speaks on inflation expectations (text, Q&A) at 1630ET.