October 24, 2012
USD/CAD 0.9907-11 Overnight Range: 0.9907-0.9926
The Canadian dollar held on to yesterday’s gains in a dull overnight session as markets await today’s FOMC meeting. Disappointing EU area PMI’s and a weaker German IFO business climate reading ahead of ECB president Draghi’s speech before the Bundestag kept the EUR/USD on the defensive. The Bank of Canada releases the Monetary Policy Report (10:30am) followed by a press conference at 11:15am which will put to rest any lingering chatter about rate cuts. Asian equity indices were mixed, European equity indices mostly higher and NY equity indice futures are also in the green. Gold is $1,708.60 and WTI oil is $86.57
The short term USD/CAD technicals are mixed. USD bulls view the retracement from 0.9980 as corrective and are content to buy US dollars above 0.9980. USD bears view the failure to even test the 100 and 200 day moving averages combined with the move back below 0.9940 as evidence that the recent move was merely a correction within the current downtrend.
Today’s FOMC meeting and the Bank of Canada press conference suggest another day of quiet trading with FX markets continuing to take direction from equity markets.
And in other news, State Road 130, between Austin and San Antonio Texas has a posted speed limit of 85 mph, a speed designed to reduce the number of “good ol’ boys” and poorly maintained pick-up trucks from public highways.
Today’s Range 0.9870-0.9940
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Vice President, FX Trading