LoonieViews June 15, 2012

June 15, 2012
USD/CAD Open 1.0230-35 Overnight Range 1.0222-1.0241

The Canadian dollar edged higher in a lack luster overnight session as the US dollar retreated vs. the majors ahead of US data, a G-20 meeting and the Greek elections on Sunday. Commodity prices are higher ( WTI Oil $85.51, Gold $1,624.70) as are global equity indices and NY futures on speculation of world wide, massive liquidity injections if the Euro Zone goes nuclear and Greece is ground zero. The Bank of England announced that it is “preparing measures to fight escalation of the Euro debt crisis, including a Sterling Liquidity Facility. Across the pond, Ben Bernanke is widely speculated to priming his own liquidity cannon in preparation for round 3 of QE.

The short term USD/CAD technicals are bearish looking for the US dollar to break below the 1.0190-1.0205 area to extend gains to 0.9970. However, a move back above 1.0310 negates the setup. For today, USD support is at 1.0210, 1.0190 and 1.0140. Resistance is at 1.0260, 1.0290 and 1.0310.

Central Bank governors from around the world are all drinking the Kool-aid, warning of doom and gloom if the Greek elections precipitate an exit from the Euro and seem to be preparing the world for a flood of liquidity. Global equity indices are all higher but it is hard to believe that the moves are sustainable in the event of a European meltdown.

And in other news, Nik Wallenda will be strolling across Niagara Fall on a tight rope, supposedly contractually obligated to be tethered to the wire to avoid ABC from broadcasting live, a spectacular high dive. It remains to be seen if the rabid US Homeland Security forces, will be strip searching him in case he is hiding explosives or terrorists as he crosses to the American side.

Today’s Range 1.0160-1.0260

Michael O’Neill


Categories Markets

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