USDCAD Range 1.3140-1.3288
USDCAD has stalled in a narrow 1.3140-1.3290 trading band despite modestly better trade data. Canadian exports rose 2.3% and were concentrated in non-energy products, according to Statistics Canada. That should be good news for the Loonie as increasing non-energy exports was a key part of the Bank of Canada’s view for a second half recovery. Unfortunately, at this juncture no one cares as all eyes are on the European Central Bank. (ECB)
Mario Draghi, president of ECB is holding a press conference as this is being written. He has alluded to the prospect of another round of quantitative easing through the increase of the share limit from 25% to 33% and the ECB have also lowered inflation forecasts. The thought of a European QE2 has driven EURUSD down to 1.1110 from 1.1240 earlier today. The Canadian dollar may derive some support as EURCAD selling has broken the short term uptrend that was intact since the middle of August.
The ECB meeting has overshadowed this morning’s US data. Jobless claims rose to 282,000, up 9,000 from last week. The August US Trade deficit narrowed to $41.8 billion from $45.2 billion in July.
The intraday technicals are modestly bearish while trading below 1.3280 looking for a move below 1.3230 to extend losses to 1.3180. A move above 1.3350 is need to lift expectations for a run to 1.3450. A break below 1.3110 should lead to further losses toward the 1.2950-1.3000 area.
Today’s Range 1.3190-1.3290
Chart: USDCAD hourly showing intraday uptrend starting to break