USDCAD Overnight Range 1.2333-1.2438
The US dollar and the Canadian dollar have gained against all the majors with the exception of JPY. It’s the rise of the CanAm bloc. In reality, it’s not due to the rise of anything but rather because of the evaporation of clear trading catalysts. USDCAD has been marching to the beat of its own drummer for the past few sessions and may have been buoyed by yesterday’s strong Housing Report (201.7 vs forecast 185.0) which when combined with the employment report, supports calls for a bump in Q2 GDP.
This morning, USDCAD slid slower, right from the Toronto opening level of 1.2395-00, breaking below major support in the 1.2360-80 area and is heading toward support at 1.2310, representing the 38.2% Fibonacci retracement level of the May 11-June 2 range. In the absence of any other news, a rebound in WTI oil from $57.50 to $59.65 may be a factor in the Loonies rise.
EURUSD is being bounced around by conflicting EU/Greece debt deal headlines. Reuters has reported that Greece submitted a 3 page proposal of targets to a less-than impressed EU Commission. Other factors include reduced liquidity exaggerating Bund driven moves.
Thursday’s US Retail Sales report is expected to follow in the footsteps of last Friday’s NFP data and provide further evidence of a rebounding US economy. That will set the stage for the following week’s FOMC meeting and renewed chirping about the timing of a rate hike.
There isn’t any data on tap today to provide any additional encouragement.
USDCAD technical outlook
The intraday USDCAD technicals are bearish following this morning’s break of major support in the 1.2360-80 level which sets the tone for further weakness below 1.2310 support down to the 1.2160 level. In addition, the break of the 100 day moving average (1.2411) shifts the focus to the 200 day moving average at 1.1890. For today, USDCAD support is at 1.2330, 1.2310 and 1.2280. Resistance is at 1.2370 and 1.2390
Today’s Range 1.2310-70
Chart: USDCAD 4 hour with expected trading range for the week