Loonieviews October 4, 2012

October 4, 2012
USD/CAD Open 0.9855-60 Overnight Range 0.9854-0.9874

The USD/CAD rate stayed above the “new” support zone in the 0.9840-50 area overnight, marking time with the rest of the majors ahead of the ECB rate announcement and press conference today. The AUD/USD came under renewed selling pressure on the back of a weak retail sales report while USD/JPY stayed bid on BoJ intervention concerns. Tomorrow’s US payrolls report is adding to the market lethargy, keeping traders sidelined. Asian equity indices were higher, European indices mostly lower and NY equity indice futures are higher. Gold is $1,791.10 and WTI oil is $88.77. US data releases include; Jobless claims (370k), Factory orders (-5.8%. In Canada, the IVEY PMI will be the focus.

The short term USD/CAD technicals are bullish targeting 0.9940 on the break of 0.9850, an uptrend which will stall with a move back below 0.9840. For today, USD support is at 0.9840 and 0.9810 Resistance is 0.9875 and0.9915

The Canadian dollar is under short term pressure due to CAD selling vs. the EUR as well as the dip in WTI oil. However, the longer term USD/CAD downtrend remains intact below 0.9940.

And in other news, numerous press reports have stated that Mitt Romney was the clear winner over President Obama in round one of the presidential debates. A Bloomberg story describes Romney as “relaxed and in command of details” while Obama was described as “verbose, weary and seemingly ill-prepared” The White House reportedly responded saying, “it’s easy to be relaxed and well prepared, when you don’t even have a job or have the stress and demands of running a country”

Today’s Range 0.9820-0.9880

Michael O’Neill


Categories FX, Foreign Exchange, Currency, Canadian Dollar

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