USDCAD Overnight Range 1.1993-1.2070

The Avengers may be called into action today as US dollar selling due to month-end rebalancing flows and renewed risk seeking sentiment may drive the greenback into the ground.

The US dollar never recovered from yesterday’s ugly GDP report and the FOMC statement added to its woes.  Many believe that the statement was dovish, although, other than a nod to “transitory” factors it was fairly similar to the March statement.

There was no doubt about the message delivered in the RBNZ statement.  Rates could go lower.NZDUSD certainly did, dropping to 0.7580 from 0.7740. The BoJ left policy unchanged.

EURUSD extended yesterday’s gains in a lively European session, aided by good regional data and diminished negativity surrounding the Greece negotiations.

USDCAD traded erratically following this morning’s data dump.Canadian GDP beat expectations and came out unchanged which was good for the Loonie. At the same time, US Jobless Claims and the newly important, employment Cost Index (ECI, both beat expectations, which was good for the US dollar.

USDCAD technical outlook

The intraday technicals are bearish while trading below 1.2060 targeting another test of support in the 1.1940-60 area which if broken, will lead to 1.1725. However, the daily chart, shows that the move below 1.1980-90, may just be a “blip” meaning that the long term uptrend from the July lows is still intact.  The result is a lot of churning ahead of the 8:00 am PST month-end fixing time.

Today’s Range 1.1960-1.2060