March 5, 2012
USD/CAD Open 0.9990-95 Overnight Range 0.9940-1.0007
|The Canadian dollar rise stalled at 99.40 overnight and steadily retreated. Australia’s RBA left interest rates unchanged (as expected) and then added to the general AUD/USD selling pressure reiterating that it has "scope to ease". Overall, yesterday’s Chinese announcement targeting lower GDP growth, and today’s weaker Euro zone economic data tipped the scales to risk aversion leading to a higher US dollar across the board. This same sentiment drove commodity prices lower and saw declines in Global equity indices including NY futures. The only data from Canada is the Ivey Purchasing Managers, (forecast 62.0)
The short term USD/CAD technical’s are bullish. The break of 0.9980 points to further USD strength to the 1.0040 zone. Only a move below 0.9940 would negate the stronger USD bias. for today, USD support is at 0.9970 and 0.9940. Resistance is at 1.0020 and 1.0050
Today’s IVEY release has the potential to exacerbate ate Canadian dollar weakness if it is below expectations. However, a better than expected print will only dampen the CAD$ selling pressure in the context of a broader risk aversion environment.
And in other news, the Penguin has escaped from a Tokyo zoo. Alert Japanese officials immediately contacted Commissioner Gordon-san, who promptly fired up the bat signal.
Today’s Forecasted Range 0.9960-1.0040