Investors have always heard that “bulls make money, bears make money, and pigs get slaughtered.” Maybe this year will be different.

Global FX markets traded quietly in narrow ranges overnight.  China is closed for the next five days which won’t help liquidity.  The US dollar opened in New York with small gains against all the majors except for the New Zealand dollar which was flat.  Soft Australia Building Permits data weighed on AUDUSD as did concerns for a dovish Reserve Bank of Australia monetary policy statement on Tuesday.  USDJPY traded firmer supported by higher US Treasury yields.

EURUSD is trading with a modestly negative bias due to weak Eurozone data (Sentix Investor Confidence and PPI) as well as the lingering impact from Friday’s US jobs report. GBPUSD is resilient in the face of the Eurozone’s apparent lack of interest in renegotiating “alternative arrangements” to the Irish backstop plan. GBPUSD is at the bottom of its 1.3051-1.3094 range.

USDCAD has underperformed the rest of the majors because firm oil prices are offsetting broad US dollar demand.  WTI oil touched $55.72/barrel overnight, continuing to derive support from hopes of a China/US trade deal, Opec production cuts, Venezuela sanctions and the Polar Vortex.

Today’s trading session is likely to be a dull as yesterday’s “Super Bowl” with only US factory orders data on tap.

USDCAD Technical Outlook

The intraday and short term USDCAD technicals are bearish while prices are below 1.3105 and 1.3180.  The break below 1.3116 (61.8% Fiboancci retracment of October-January range) targets further losses to the 76.4% level at 1.2988.  A move above 1.3120 suggests 1.3070-1.3180.  For today, USDCAD support is at 1.3070 and 1.3040.  Resistance is at 1.3105 and 1.3130.  Today’s Range 1.3070-1.3120