USDCAD Overnight Range 1.3204-1.3291              

The USDCAD rally that began yesterday morning is in full swing, supported by the break of resistance at 1.3140 resistance yesterday. Sentiment has shifted from believing that the Fed was extremely doveish last week to the belief that perhaps they aren’t doveish at all. Yesterday, the ever-verbose, San Francisco Federal Reserve President, James Bullard, told Bloomberg that an April rate hike was a possibility. The larger-than-expected build in Crude Oil Stocks (Actual 9.357 million barrels vs. forecast 3.09 m/b) gave oil bulls pause and WTI has drifted lower ever since. WTI dropped from $39.22 in early New York trading to $38.33 coinciding with a move higher in USDCAD. Another factor in the US dollar’s strength is pre-holiday weekend positioning.

It was a similar story in the overnight markets. USDJPY ticked higher in Asia on a rising Nikkei but has since drifted back to yesterday’s New York closing level. Lower commodity prices helped drive AUDUSD down in Asia but that move didn’t last either.

In Europe, Euro and sterling were rangebound and UK data (Retail Sales -0.4% vs. forecast -0.7%) was ignored.  The Swiss National Bank released its annual report.  They spent CHF 86.1 billion intervening in FX markets.

This mornings release of US Durable Goods (slightly better-than-expected) and Jobless Claims (mildly worse) didn’t have much of an impact on FX trading.  Most European markets are closed tomorrow for Good Friday as is Canada. US traders will entertain themselves with the release of Q4 GDP data.

USDCAD technical outlook

The intraday USDCAD technicals are bullish while trading above 1.3040 and supported by the break of 1.3140 and now has 1.3340 in its sights.  A break of this level will open the door for a push to 1.3460. Only a move below 1.3180 would negate the immediate topside pressure.  For today, USDCAD support is at 1.3230 and 1.3180.  Resistance is at 1.3290, 1.3320 and 1.3340

Today’s Range 1.3230-1.3320

Chart: USDCAD  1 hour