January 3, 2013-Happy New Year!
USD/CAD 0.9845-50 Overnight Range: 0.9842-0.9944
The Canadian dollar rallied nearly 1.2% vs the US dollar since Friday, buoyed by the news that the US brain-trust announced a deal on the fiscal cliff negotiations. In reality, they are selling a pig in a poke as the legislators have merely cobbled together a series of delaying motions which will unravel by March and calling it a “result”. Whatever the case may be, the light flashed green and investors piled into risk. WTI oil is $93.35 on an improved outlook for growth and gold rallied to $1,690.74. Global equity indices and NY equity index futures are all higher.
The short term USD/CAD technicals are bearish USD following the break back through support at 0.9910, looking for a further break of support around 0.9820-30 to extend US dollar losses to 09740. For today, USD support is at 0.9840 and 0.9820. Resistance is at 0.9880 and 0.9910. The following chart shows the price activity from Friday until now (10 minute chart)
It would appear that desks are still not fully staffed as those that can, take an extended Christmas/New Year’s break meaning liquidity is still at a premium.
And in other news, a man in Norwich, England claimed he was assaulted by ‘Oompa Loompa`s, leaving him with two black eyes and a sore nose. Willy Wonka denied any involvement
Today’s Range 0.9820-0.9880
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Vice President, FX Trading