USDCAD Overnight Range 1.3320-1.3375
Friday’s Canadian Trade data was a delicious appetizer ahead of the main entrée “Poloz under Glass” which will be dished up on Wednesday. Virtually, no one expects any policy action from the Bank of Canada, but an optimistic statement stressing Canadian economic upside may be the spark that drives USDCAD below the 200 day moving average (1.3288). But that is Wednesday and until then, USDCAD is likely to trade sideways within a 1.3300-1.3420 band.
It was a very slow start to what will be a busy week. The US dollar hasn’t recovered from Friday’s post-payrolls sell-off. Eight of the G10 currencies are higher on the day, led by NZDUSD while USDJPY squeaked out a small gain. In Asia, China announced a 2016 GDP growth target of 6.5-7% and 3% for inflation.
Oil prices have broken key resistance and the technicals suggest further gains toward $40.00/b. Obviously, traders have concluded that oversupply issues are yesterday’s news and that Russia/Opec efforts to control supply will work. WTI traded in a $36.18-$36.72 range and currently sits at $36.45.
There isn’t anything in the way of economic data today although the Fed’s Stanley Fischer delivers a speech at 10:00 am PST. He is also the last Fed speaker until next weeks FOMC meeting.
USDCAD technical outlook
The short term USDCAD technicals are bearish in a declining channel bound by 1.3280 and 1.3420. The intraday technicals are bearish while below 1.3380 looking for a move to 1.3288 (200 day moving average) which if broke will lead to 1.3000. For today, USDCAD support is at 1.3310 and 1.3280. Resistance is at 1.3380 and 1.3420
Forecast Range for the day 1.3300-1.3380
Chart USDCAD Daily