December 11, 2012
USD/CAD 0.9870-75 Overnight Range: 0.9861-0.9880
The USD/CAD rate traded quietly overnight but maintained its bearish USD bias ahead of the FOMC statement tomorrow. In Asia, JPY trading was muted ahead of the Japanese elections Dec. 16, with Shinzo Abe the current favorite. He is on record for wanting a massive stimulus program. In Europe, the EUR/USD rose in part due to a better than expected German ZEW report (sentiment) in part due to expectations that the FOMC will be encouraging further economic stimulus. The Nikkei was flat but both the ASX 200 and the Hang Seng gained as did all European equity indices. NY equity futures indexes are higher as well. Gold is trading at $1,713.77 and WTI is $86.16
The short term USD/CAD technicals are bearish with the USD/CAD rate in a gently downward sloping channel bound currently bound by 0.9850-0.9920. For today, USD support is at 0.9860, 0.9850 and 0.9770. Resistance is at 0.9880, 0.9890 and 0.9910
The Canadian dollar will likely continue to grind higher supported by the potential for last minute CAD$ demand to close the Petronas and CNOOC transactions and because of the possibility of further US stimulus devaluing the US dollar.
And in other news, Canada’s finance Minister, Jim, Flaherty has denied reports that he was seen shopping at a Toronto area IKEA store and submitted the following picture to prove that he was actually spending quality time with the Prime Minister.
Today’s Range 0.9850-0.9890
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.
Vice President, FX Trading