Loonieviews April 16, 2013

April 16 2013
USD/CAD Open 1.0219-24 Overnight Range 1.0214-26

The Canadian dollar has recovered somewhat from yesterday’s thrashing with a bounce in gold prices (+$24.50 TO $1,385.50) but WTI oil remains depressed at $88.21. Gold is higher on the belief that global inflation rates are headed higher and a comment from the Sri Lankan Central bank that the gold drop may be a buying opportunity. However, Goldman Sachs stated in a report that Cyprus may have to sell gold from its reserves triggering a monetization across other Central banks. Back to currencies, the JPY renewed its downtrend and the subsequent CAD/JPY purchases also supported the loonie. The EUR recovered from initial weakness following a weaker than expected German ZEW report. Global equity indices are all lower but NY equity index futures are higher to start today. US data releases include: CPI (march 1.6%, YoY, ex food/energy 2.0% YoY), Housing Starts (Mar. 0.930m), building Permits, Redbook, Industrial Production and Cap. Utilization

The short term USD/CAD technicals are bullish while trading above 1.0210. A move through this level would extend US dollar losses to 1.0180. A move above 1.0250 sets up a test of 1.0320. For today, USD support is at 1.0210 and 1.0180. Resistance is at 1.0250 and 1.0290.

And in other news, Canada’s defence Minister, Peter MacKay, announced that the Royal Canadian Navy’s fleet of submarines will be fully operational, a mere 15 years after they were purchased from Britain’s Used Submarine Lot.

Today’s Range 1.0180-1.0250

Michael O’Neill


Categories FX, Foreign Exchange, Currency, Canadian Dollar

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