USDCAD Overnight Range 1.2561-1.2644  

USDCAD dropped from the early New York highs following comments from an advisor to Japanese PM Abe stating that JPY is too high at 120. USDJPY plunged from 120.80 to 119.75 taking the US dollar down across the board.

Overnight, China posted weaker than expected trade data and AUDUSD tumbled, dragging down Kiwi and the Loonie with it. Adding to the AUDUSD’s woes was a report that the Australian Treasurer was considering reducing iron ore revenue forecasts by $25 billion over next four years.

The “buy-the-US dollar theme continued into Europe although there wasn’t a clear catalyst for the move. The dollar rally fizzled in early New York trading following the JPY comments by one of Mr. Abe’s advirsors.

The Canadian dollar has held in rather well considering the size of the drop in AUD and NZD and following Friday’s domestic employment report. A loss of 28,200 full-time jobs is hardly a ringing endorsement of an economic recovery.The Bank of Canada is expected to leave rates unchanged on Wednesday.  However, the Monetary Policy Report will be closely watched for a downgrading of forecasts

USDCAD technical outlook

The intraday USDCAD technicals are mixed within the context of a 1.2550-1.2650 trading band.  Above 1.2590 keeps the focus on a break of resistance in the 1.2640-70 area to extend gains to 1.2820. Below 1.2590 targets support at 1.2530-50 which if broken would extend losses to 1.2480.

Today’s Range 1.2550-1.2610