USDCAD Overnight Range 1.3655-1.3710    

The ECB minutes from the January 22, 2016 meeting were released and were doveish as expected yet they were enough to refocus EURUSD on the downside. A break of the 1.1060 area will open the door to a steeper drop.  This mornings US data was mixed and therefore ignored.

Meanwhile, USDCAD started the New York session around 1.3670 which is just above strong support in the 1.3630-50 zone. Early activity saw USDCAD push to 1.3710 where it stalled and has returned to its opening level. Better than expected Canadian Wholesale Sales data for December (Actual 2.0% vs. forecast 0.2%) provided a bit of support for the Loonie.

Asia FX had its own issues.  The Australian unemployment was worse than expected, shedding 7,900 jobs when a gain of 15,000 was forecast. Predictably AUDUSD dropped but the volatility of the report soon had traders buying back the AUDUSD that they had sold. Kiwi traded with a similar pattern. USDJPY came under renewed selling pressure, in part because of a news story stating that Prime Minister Abe said he had ruled out additional stimulus.  China continued to befuddle traders. The USDCNY fix was 6.5152, lower than the 6.5235 that had been anticipated.  Earlier in the week USDCNY was fixed far higher than expected so today’s actions leave traders scratching their heads.

The Energy Information Administration (EIA) Crude Oil Stocks change report will be released at 8:00 PST.  If it follows yesterday’s American Petroleum Institutes report of a 3.3 million barrel decline with a decline of it’s own, WTI will rally and USDCAD will slide.

USDCAD technical outlook

USDCAD is in a downtrend while trading below 1.3850 and in an intraday downtrend while below 1.3720.  Both downtrends are looking for a break of the 1.3620-50 area to extend losses to the 1.3430-50 zone. A move above 1.3720 would point to further gains to 1.3820 and suggest consolidation within the 1.3650-1.3800 band.  For today, USDCAD support is at 1.3650, 1.3620 and 1.3570.  Resistance is at 1.3720, 1.3770 and 1.3820

Forecast Range for the day 1.3620-1.3720

Chart USDCAD 30 minute