USDCAD Overnight Range 1.2512-1.2577    

USDCAD found a short term floor yesterday at 1.2390 and bounced like a “Wham-O SuperBall” off pavement, rising 0.0150 points before a pause and then grinding even higher after the FOMC minutes. News headlines trumpeted “FOMC split on June rate hike”.  That headline isn’t just misleading its plain wrong.  The FOMC minutes said “Several participants judged that the economic data and outlook were likely to warrant beginning normalization at the June meeting”. Several is not a split. Nevertheless, it got the ball rolling and the US dollar was in demand.

The overnight FX markets were a tad wonky with Asian US dollar sellers becoming European dollar buyers.  Greece apparently made a €450 million payment to the IMF giving a short lived pop to EURUSD. To the surprise of no one, the Bank of England left rates unchanged

USDCAD dropped from 1.2560 to 1.2520 as NY walked in coinciding with a jump in EURUSD to 1.0775 from 1.0738.  Canadian Building Permits were below consensus at -0.9% (Forecast 2.2%) and the New House Price Index edged higher. The impact on the currency was negligible.

USDCAD technical outlook

The intraday USDCAD technicals are bearish.  The failure to extend gains beyond 1.2580 with a break of minor support in the 1.2490-1.2505 area will lead to another visit to major support at 1.2390-1.2410. Only a gain above 1.2880 would negate the downward pressure. For today, USD support is at 1.2490 and 1.2460.  Resistance is at 1.2540 and 1.2580.

Chart: USDCAD hourly showing the range (between the red lines)