USDCAD   Overnight Range 1.2995-1.3040    

The commodity bloc currencies, (AUD, NZD, CAD) were the big gainers overnight, although the Loonie’s gain was rather shy of impressive. In fact it was just a tiny gain. News that both China Securities Regulatory Commission (CSRC) and China Securities Finance Co (CSFC) promised additional measures to shore up/stimulate equity markets provided a thin blanket of calm over the Chinese equity markets.  It was enough for Chinese equities to limit losses on the day and AUD, NZD and CAD to rise.

GBPUSD was the start of the show in Europe, gaining on the back of a GDP number (Q2 0.7%) which was as expected.

This morning’s release of the US Case Shiller Housing Price index (Actual May 4.9% vs. forecast 5.6% y/y) was a disappointment but not really a factor for FX trading.  FX direction will be dictated by continuing position adjustments ahead of tomorrow’s FOMC meeting with USDCAD traders eying WTI prices hovering just above support at $46.75. (Currently $46.95)

Technical Outlook

The USDCAD technicals are bullish while trading above the 1.2980-90 area but gains have stalled at 1.3050.  Failure to take out this level could lead to more 1.2970-1.3050 consolidation.  A break above 1.3050 targets 1.3110 while a move below 1.2970 opens the door to a move to 1.2900.  For today, USDCAD support is at 1.2990, 1.2970 and 1.2930.  Resistance is at 1.3050, 1.3090 and 1.3110.

Today’s Range 1.2990-1.3030

Chart: USDCAD daily with uptrend