USDCAD Overnight Range 1.3125-1.3185
The US dollar continued to grind out gains against the G10 currencies in a more subdued overnight session. The surprise 3.2 million barrel drawn down in Crude Stocks as reported by the American Petroleum Institute, late yesterday, gave WTI a boost as did positive noises surrounding the Russia/Opec meeting in Doha, on April 17.
In Asia, the focus remained on Japanese Prime Minister Abe’s comments in the WSJ on Tuesday, warning against competitive currency devaluations. USDJPY is hovering just above yesterday’s 109.92 low (currently 110.30). China’s Caxin Services PMI rose to 52.2 from 52.1
GBPUSD is offered, in part due to Brexit issues and because of general US dollar strength. EURUSD drifted lower in both sessions but remained well within its current 1.1300-1.1400 range.
USDCAD traders shrugged off the WTI rally and drifted higher overnight in line with the bullish US dollar sentiment. The BoC Deputy Governor Carolyn Wilkins speech at the end of the day did not have any currency impact.
Traders will be dissecting the FOMC minutes in hopes of determining whether the Committee is as doveish as Janet Yellen’s remarks suggest or as hawkish as some of the recent Fed speakers imply. If the minutes are thought to be hawkish, the US dollar will extend its recent gains.
USDCAD traders will be looking to today’s Ivey PMI report and the EIA Crude stocks report for direction. If the EIA report confirms the API draw down, the ensuing WTI rally should help to offset USDCAD gains from hawkish FOMC minutes.
USDCAD technical outlook
The intraday technicals show USDCAD is in a steep uptrend while trading above 1.3140 and looking to break above resistance in the 1.3190-1.3220 area to extend gains to 1.3290. A break below 1.3140 would see a test of support at 1.3100, which if broken would lead to 1.3060. The short term set-up shows USDCAD probing the top of a 1.2910-1.3205 trading band which has contained price action (more or less) since March 28, 2016
Today’s Range 1.3110-1.3210
Chart: USDCAD 4 hour
