USDCAD Overnight Range 1.2667-1.2760
USDCAD was bid right out of the gate at the start of trading in New York. The prospect of a widening Canada/US interest rate differential on a Bank of Canada rate cut combined with the likelihood of increasing supply in an already oversupplied oil market weighing on WTI prices undermined the Canadian dollar. Ongoing concerns of an economic slowdown in China and the impact on commodity prices didn’t help matters, either.
Meanwhile, the European leaders and Greece announced the framework for a deal in a press release this morning. The EU leaders chastised Greece in the opening line, implying that Greece has been a tad less than honest and then insisted that a series of measures have to be legislated by Wednesday, prior to receiving any funds. It would appear that Tsipras believed Greek EU membership was inviolate only to discover, at the 11th hour, that the EU did not.
As was expected, FX trading was choppy and liquidity was thin. EURUSD touched 1.1195 and 1.1055 while USDJPY soared to 123.45 from 121.98.
The intraday technicals are bullish while trading above 1.2690 with a break of 1.2760 area extending gains to the 1.2820-50 zone. A break of 1.2850 puts 1.3050 in play. On the day, a move back below 1.2690 would imply further 1.2660-1.2760 consolidation. A decisive move below 1.2640 would negate the short term upward pressure and lead to 1.2530-1.2680 consolidation. For today, USDCAD support is at 1.2690, 1.2660 and 1.2640. Resistance is at 1.2760, 1.2790 and 1.2820
Today’s Range 1.2710-1.2790
Chart: USDCAD daily with support and resistance