Loonieviews October 25, 2012

October 25, 2012

USD/CAD 0.9913-17 Overnight Range: 0.9903-0.9945

The Canadian dollar stayed within the recent range overnight tracking movements in EUR/USD. Not surprisingly, the FOMC stuck to its stimulus plan which led to a softer dollar. Overnight, it was another tepid drift into risk seeking backed by mere comments (not data)from China’s Ministry of Industry saying that the country’s factory output should grow faster in the last quarter. BoJ easing anticipation helped to keep USD/JPY bid. Stronger than expected UK GDP data, attributed to the Olympics gave sterling a boost before markets settled in to wait for US data, which includes; Jobless claims (forecast 370k), Durable Goods (7.1% MoM’ Core 0.8% MoM) and Pending Home sales (2.1% MoM. Global equity indices including NY equity indice futures are all up. WTI oil is 486.47 and gold is $1,717.20

The short term USD/CAD technicals are still mixed. USD bears believe that USD is bearish while trading below 0.9940 but needing a break of support at 0.9880 to extend the downtrend. USD bulls see the failure to break below 0.9880 as evidence the USD uptrend and look to buy around 0.9890 for a test of the 200 day moving average at 0.9972. For today, USD support is at 0.9910 and 0.9880. Resistance is at 0.9940 and 0.9970

And in other news, the former soc Gen trader, Jerome Kerviel, whose trading acumen garnered a $6.3 billion loss, failed in his bid to reverse his guilty verdict.. He is going to appeal this ruling as well. In addition, he still has to repay the loss. Hopefully French prisons have a higher per diem then Canadian prisons.

Today’s Range 0.9870-0.9940


The content and opinions expressed within this commentary are solely those of the author(s) and are not necessarily shared by Jitney Trade. The data and comments provided herein are for informational purposes only and must not be construed as an indication or guarantee of any kind of what the future performance of the concerned markets will be. There is a substantial risk of loss in trading commodity futures, options and foreign exchange products and is not suitable for all investors. Contact your account representative for more information on these risks. Information and opinions contained herein come from sources believed to be reliable but are not guaranteed as to accuracy or completeness. Please carefully consider your financial condition prior to making any trading decisions.

Michael O’Neill

Vice President, FX Trading


Categories FX, Foreign Exchange, Currency, Canadian Dollar

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