USDCAD Overnight Range 1.2436-1.2533  

The US dollar is down across the board continuing the trend which began overnight following a tsunami of headlines pertaining to the Greece and EU debt renegotiations. The USD gave back all of yesterday’s post US ISM gains and then some.  The headlines have been coming fast and furious and due to the lack of any meaningful US data have been given an exaggerated level of importance. Nevertheless, EURUSD has soared to as high as 1.1190 from 1.0950 in New York trading.

The Reserve Bank of Australia (RBA) got the ball rolling with what has been described as a “less-than doveish” statement when a reference to an easing bias was omitted. AUDUSD jumped to 0.7702 from 0.7625. In Japan, early demand for USDDJPY which pushed it above 125.00 didn’t last and the currency pair retreated.

The European session was rife with rumours about a pending/last minute Greece debt deal which came to a head with the most recent headlines. Those rumours underpinned EURUSD as did better than expected German employment data.  UK data was also positive and GBPUSD gained ground.

USDCAD has plunged in concert with the broad US dollar weakness, dropping from 1.2530 to take out support at 1.2490.  It has tested the second level of support at 1.2440 which has held. The Greek tale is only part of the story this week. Friday’s US nonfarm payrolls could kick off another bout of dollar buying on an upside surprise.

USDCAD technical outlook

The intraday USDCAD technicals are bearish following the break of support at 1.2490.  A break below 1.2440 would suggest a short term top is in place at 1.2560 which would be confirmed by the loss of 1.2410. A move below 1.2410 would target 1.2320. Failure to break 1.2440 suggests additional 1.2440-1.2560 consolidation until Friday.

Today’s Range 1.2430-1.2490

Chart: USDCAD 4 hour Fibonacci target