USDCAD Overnight Range 1.4489-1.4652      

It is Martin Luther King Day in the US and bond and equity markets will be shuttered while skeleton staffs will man FX desks. American’s will be remembering Martin Luther King’s, “I have a dream” speech while USDCAD traders will be waking from a bad dream-“ did USDCAD really touch 1.4652 overnight”?

News that the Iranian sanctions had been lifted sent oil prices plunging. WTI touched $28.36/b. USDCAD gapped higher at the opening in Asia and then retreated as WTI prices recovered.

USDCAD should remain in a 1.4440-1.4600 range ahead of Bank of Canada meeting on Wednesday.  There is a lot of chatter about a rate cut

Other than USDCAD and oil price volatility, it was a relatively dull start to the week. However, Chinese data tomorrow morning may change that if it is weaker than expected.

USDCAD technical outlook

The intraday USDCAD technicals are bullish while trading above 1.4470 supported by another uptrend line from the beginning of January that comes into play at 1.4440.  Longer term, the break of 1.4500 which was the 76.4% Fibonacci retracement level of the 2002-2007 range, opens the door to a 100% retracement which comes into play at 1.6183.  For today, USDCAD support is at 1.4480 and 1.4440.  Resistance is at 1.4550 and 1.4600.

Forecasted Range 1.4470-1.4550

Chart USDCAD  1 hour