USD/CAD Open 1.0199-1.0204 Overnight Range 1.0193-1.0250
The Canadian dollar recouped some of Friday’s losses overnight in a tepid start to FX trading for the week. S&P downgraded 9 countries late Friday, although rumours of the action were rampant. It would have been news, 18 months ago, but once again the rating agency announcement is as timely as “Lincoln’s been shot”! Nevertheless, the US dollar was in demand as a safe haven. The EUR/USD was under pressure in early Asian trading but recovered somewhat in Europe after reports that the ECB was buying debt from Spain and Italy. Greece will be back in the spotlight later this week as restructuring talks resume. Bloomberg reports that PIMCO’s Bill Gross expects Greece to default. Asian equities were lower while European equity indices are mixed. NY equity futures are also down. WTI oil is $99.40 and gold is $1,644.73. US markets are closed for Martin Luther King Day.
The short term Canadian dollar technicals are mixed to bearish while the USD/CAD rate is above 1.0080. A move through 1.0280 should yield 1.0450 while a rally below 1.0080 opens up a test of 0.9980. For today, USD support is at 1.0180, 1.0160 and 1.0110. USD Resistance is pegged at 1.0230, 1.0250 and 1.0280
The Canadian dollar will remain vulnerable to further risk aversion trading stemming from the fall-out of the S & P downgrade and the heightened risk of a Greek default. The MLK holiday will make for a quiet trading day
Today’s Range 1.0180-1.0250