USD/CAD Open 1.0300-05 Overnight Range 1.0260-1.0310
The Canadian dollar stayed under pressure over night, continuing to be undermined by concerns that Bernanke may discuss an end to quantitative easing in his testimony today. Another drop in consumer confidence in Australia plus the Bernanke fears drove the AUD/USD lower. USD/JPY stayed bid following no surprises from the BoJ meeting. Asian equity indices were mixed with the Nikkei up while the Hang Seng and the ASX200 were lower. European equity indices were flat to down while NY equity index futures are up modestly. Gold is$1,387.00 and WTI oil is $95.75. US data today includes: FOMC minutes, Bernanke Testimony, April Existing Home Sales (1.5% MoM). Canada releases March Retail Sales (forecast 0.1%, ex-autos 0.2% MoM)
The USD/CAD had a peak at resistance in the 1.0320-40 area yesterday and quickly reversed course in part due to fears that the dollar rally was overdone. In addition, if Canadian retail sales data surprises to the upside and Bernanke fails to address an end to QE, the CAD$ will rally back to 1.0160. Sell USD/CAD between 1.0305-20, with a stop above 1.0340 for a return to 1.0180.
The short term USD/CAD technicals are bullish but need a break through 1.0340 to extend gains to 1.0440. A move below 1.0260 will negate the upside pressure and lead to further USD/CAD losses to 1.0180. For today, USD support is at 1.0270 and 1.0230. Resistance is at 1.0320 and 1.0340
And in other news, a Toronto Police staff inspector, Steve Izzet , described as “the boss from hell” will find out today if he will be fired after being found guilty of sexual harassment and destruction of evidence. He has been on paid suspension for years at $120+k per annum while dragging out his case for 4 years in order to get the full 30 year pension pop. The inability of the city to claw back these payments could make even a Mayor want to smoke crack.
Today’s Range 1.0260-1.0320