February 16, 2012
USD/CAD Open 1.0033-38 Overnight Range 0.9992-1.0050
|The Canadian dollar stayed under pressure overnight as the unsettled situation in Greece led to wide spread buying of US dollars. The EU Zone Finance ministers delayed the decision for additional funds for Greece, despite written assurance that the earlier restructuring conditions demanded, would be met. In addition, Finland and the Netherlands are reportedly proposing that any formal approval be delayed until after the Greek elections. Global equity indices and NY futures are all lower. Meanwhile, USD/JPY continues to stay bid, suggesting that we may have seen a medium term bottom in the currency pair. There are a lot of US data releases today, including PPI (forecast 0.4%), Jobless claims (forecast 365k), Housing starts (forecast 675k) and building permits.
The short term CAD$ technical’s are bearish following the US dollar retracement back through both 0.9980 and 1.0010. Further US dollar strength through 1.0050 sets up a test of the 100 day moving average at 1.0180. For today, USD support is at 1.0010 and 0.9980. Resistance is at 1.0050, 1.0080,and 1.0110.
Moody’s rating agency is warning that a large number of global banks face downgrades of two or three notches. This may be occurring because Moody’s is on the ball or perhaps Moody’s is tired of being criticized by bankers for missing the boat on the debt crisis. Revenge is best served in notches.
And in other news, Ontario PM Dalton McGuinty and his loyal Financier Minister, Jethro Bodine, hired an outside consultant to review Ontario’s finances. They are so bad that the Federal government’s proposal to the European Union to swap Greece for Ontario, was turned down, flat.
Today’s Forecasted Range 1.0010-1.0080