Loonieviews-April 24, 2012

April 23, 2012
USD/CAD Open 0.9900-05 Overnight Range 0.9900-.9927

The Canadian dollar held on to yesterday’s gains although it was mostly inert for the overnight session. The AUD/USD came under pressure as weaker than expected CPI data (0.1% vs 0.7%) gave rise to deeper rate cut expectations The US dollar returned most of yesterday’s gains against the majors as European equity indices rose. The seemingly never-ending saga of political uncertainty (France, Holland) sovereign debt woes (currently Spain) and generally weak Euro zone economic data are keeping investors on the fence. Asian equity indices climbed (except Nikkei) as have both European equity indices and NY equity futures to start today. Gold is at $1,638.30 and WTI oil is $102.06. Canadian data today includes Retail Sales for Feb. (Forecast +0.2 MoM, ex-autos +0.8% MoM) The US releases include Home prices and Consumer confidence.

The short term CAD$ technical’s are bullish looking for a breakthrough 0.9880 to extend gains to 0.9810 and 0.9740 although the entire 0.9860-75 zone will be sticky. Trading will revert to the well-defined 0.9880-0.9980 range on a break above 0.9940. For today, USD support is at 0.9880, 0.9860 and 0.9820. Resistance is at 0.9920, 0.9950 and 0.9980

A stronger than expected retail sales release today should cap any Canadian dollar weakness in the 0.9940 area and allow for a probe of below 0.9880.

In other news, another Canadian MP and Cabinet Minister, Bev Oda, International Development Minister apparently diverted funds better spend to helping under privileged nations to her personal “over-privileged politician” fund. Perhaps a can of “Oda-Eaters”, liberally sprayed throughout the House of commons, will help Canadians rid themselves of the stench of this trough munching porcine.

Today’s Range 0.9870-0.9950

Michael O’Neill



Categories Markets

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