USDCAD Overnight Range 1.3024-1.3072
USDCAD failed to extend gains above 1.3070 resistance in Asia and retreated during the European session on general US dollar weakness vs G-7 currencies. A modest decline in WTI prices was ignored.
The USDCAD decline ended when New York started. Traders have ignored better-than-expected Canadian Housing data which showed housing starts rising to a three year high, preferring to concentrate on US Jobless Claims data. Claims fell to 263,000 in the week ending October 3 and traders bought US dollars.
The story overnight was that there was no story. China returned from their Golden Week holidays and bought equities but only enough to disappoint those looking for a bigger rally to help justify the recent global equity rally.
GBPUSD eased from 1.5370 to 1.5310 when the Bank of England (BoE) left rates unchanged and delivered a doveish statement. The BoE is concerned with low inflation levels. At the same, time, a doveish report was expected so perhaps the GPUSD retreat will be short lived.
It is likely to be a fairly dull session until the FOMC minutes are released at 2:00 pm EDT. There is a slight risk that they will keep the risk of a 2015 rate hike alive which could provide the US dollar with a bit of a bump. There will be an earlier than usual and completely unofficial close to markets in Canada starting at 12:30 PDT when old and newbie baseball fans cram bars to watch the Blue Jays play their first playoff game in 22 years.
USDCAD technical outlook
The intraday USDCAD downtrend following the break of support in the 1.3290-1.3310 area last week was snapped this morning when USDCAD broke above 1.3055. Subsequent retreats halted on the downtrend line extension which has become minor support. However USDCAD needs to extend gains above 1.3070 and then 1.3140 to suggest that another short term bottom is in place. A move below 1.2950 would extend losses to 1.2680 and 1.2500 according to Fibonacci retracement analysis. For today, USDCAD support comes in at 1.3020, 1.2990 and 1.2960. Resistance is at 1.3070 and 1.3110..
Today’s Range 1.3020-1.3090
Chart USDCAD hourly