USDCAD Overnight Range 1.3368-1.3491
USDCAD started to climb in Asia, picked up steam during the European session and took off when New York came in. Oil prices are probing the 2015 lows on expectations of further losses due to on-going over production. Last week’s soft Canadian data and the prospect of a US rate hike on December 16 have compounded the Loonies woes. This morning’s break of key long term resistance at 1.3465, is significant, if the move is sustained, as it clears the path for gains to 1.4000.
Overnight, Asian FX markets were quiet as they digested the fall-out from the ECB disappointment and Friday’s strong nonfarm payrolls report. European traders got the ball rolling and bought US dollars against the G-10 currencies, led by a sell-off in EURUSD. GBPUSD traders will take note of a Bank of England governor, Mark Carney’s speech mid-morning.
There isn’t much in the way of quality American or Canadian data releases this week until Friday’s US Retail Sales report. The proximity to year and the looming FOMC decision will keep traders on the sidelines leaving oil to be the only driver of USDCAD direction has reduced liquidity which makes both WTI and USDCAD more vulnerable to wild price swings.
USDCAD technical outlook
The intraday USDCAD technicals bullish while trading above 1.3390 with the break of 1.3430 and 1.3465 in play suggesting that a short term bottom is in place at 1.3290. The break above 1.3465 takes us back to levels not seen since 2004. There is resistance at 1.3505 and 1.3560 and then not much until 1.3650. On the downside, support is at 1.3430 and 1.3390
Forecast Range for the day 1.3440-1.3530
Chart USDCAD 1 hour