USDCAD Range 1.3170-1.3298
USDCAD is flirting with levels not seen since June 2004 and we can thank former drama teacher, Justin Trudeau for that. Even though the Liberal government hasn’t been in power since 2006, and their chances this year are slim, news headlines trumpeting Trudeau’s plan for 3 years of $10 billion deficits doesn’t inspire confidence in a currency already beaten up by low oil prices.
Overnight, G-7 currency volatility diminished as Asian equity indices moved higher and closed the week on a firm footing. That wasn’t the case in Europe. European equities are down and a slew of economic releases failed to inspire FX trading.
The Chinese market sell-off that created a mini-market meltdown across the globe is fading from memory as the focus shifts to the Jackson Hole Symposium. This meeting is garnering a lot of attention because pundits believe that the Fed Vice Chair, Stanley Fischer will use the forum to provide additional clarity surrounding a September rate hike. Don’t bet on it. Next Friday’s nonfarm payrolls report will be key to determining lift-off.
The intraday technicals are bullish. The move back above 1.3240 snapped a downtrend and renewed the upward bias with an initial target of 1.3350 and then 1.3450. The short term uptrend from June remains intact above 1.3140. For today, USD support is at 1.3240 and 1.3190. Resistance is at 1.3310 and 1.3350.
Today’s Range 1.3160-1.3240
Chart: USDCAD 1 hour