USDCAD Overnight Range 1.3137-1.3184    

This morning’s Bank of England meeting was highly anticipated. (billed in some circles as “Super Thursday) Many traders were convinced that governor Mark Carney would open the door to UK rate hikes, as early as March 2016. He didn’t.  In fact, although his remarks were only deemed ‘mildly doveish”, traders were disappointed. The BoE trimmed some forecasts and expressed concern in global growth.  Cable traders expressed concerns with the level of the currency and crushed it. GBPUSD plunged from 1.5390 to 1.5225 and it currently sits at 1.5240.

The other overnight markets were fairly benign. The US dollar held on to most of yesterday’s gains which were triggered by Fed Chair Yellen’s hawkish comments.  She is already on record for saying that US rates will rise in 2015 and on Wednesday stated that “December was live”. That pulled the dollar buyers from the woodwork.  What she actually said was “the economy will continue to grow at a pace that is sufficient to generate further improvements in the labor market and to return inflation to our 2% target over the medium term, and if the incoming information supports that expectation, then…December would be a live possibility, but importantly, we’ve made no decision about it.”   It’s a tad less dramatic but traders hear what they want to hear.

WTI oil prices are down a tad which is keeping USDCAD firmly bid above 1.3140.  The lack of US data and the chances of more “hawkish” comments from today’s line-up of Fed speakers ahead of tomorrow’s twin Canadian and US employment reports should keep the overnight range intact

USDCAD technical outlook

The intraday USDCAD technicals are bullish while trading above 1.3060 supported by the break above resistance at 1.3140.  However, the inability of USDCAD to extend gains above the 1.3180-90 area suggests that we may see some 1.3100-10-1.3190 consolidation. A move above 1.3190 should extend gains to the 1.3240-50 zone. A move below 1.3060 puts 1.2990 in focus. For today, USDCAD support is at 1.3140 and 1.3110.  Resistance is at 1.3180 and 1.3210.

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Forecast Range for the day 1.3130-1.3190