USDCAD Range 1.3155-1.3194
USDCAD drifted within a narrow range overnight, unable to extend gains above 1.3200 and unwilling to retreat. The USDCAD strength is impressive in the face of yesterday’s greatly improved Canadian trade report which may be seen as a sign the domestic economy can be taken off of life support. On the other hand, the data is over a month old and traders are more focussed on the slide in oil prices. A break below $42.00/00 could turn nasty for both oil and the Loonie. Today’s Jobless claims report was close to forecasts and a non-event
Australia was the story in Asia but only briefly. A jump in job gains gave AUDUSD a short term boost which was quickly reversed without any apparent reason. USDJPY continued to flirt with 125.00.
GBPUSD got crushed in early New York trading. The MPC vote to keep monetary policy unchanged was widely expected to be 7-2 (some even thought 6-3) after Mark Carney’s hawkish comments on July 17th. The 8-1 result caught the market long Sterling and positions were quickly cut. GBPUSD plunged from 1.5625 to 1.5470 in minutes.
Canadian and US. employment reports are due tomorrow which is enough incentive for traders to sit on the sidelines, ensuring a quiet day ahead.
The intraday technicals are bullish while trading above 1.3150 with a break of 1.3200 likely to extend gains to 1.3300. A break of intraday support at 1.3150 will lead back to 1.3110. Longer term, the USDCAD uptrend remains intact above 1.3005. For today, USD support is seen at 1.3150 and 1.3110. Resistance is at 1.3210 and 1.3240
Today’s Range 1.3150-1.3205
Chart: USDCAD 30 minute with uptrend and resistance shown