Loonie gains as US dollar retreats ahead of FOMC
USDCAD Open 1.1285-89 Overnight Range 1.1263-1.1306
The Loonie extended yesterday’s rally into the overnight session but stalled near the 1.1260 USDCAD support area. The European session became a hive of activity when Japan’s Prime Minister called a “snap” election and announced a delay in the sales tax. USDJPY spiked to 1117.00 and then reversed course providing another example of the “rumour-fact” analogy. Meanwhile EURUSD also decided to go for a ride on the back of EURJPY demand and a little help from strong German ZEW data and pre FOMC position adjustment.
The lack of decent US or Canadian data argues for another day of FX trading consolidation within the confines of the overnight ranges.
The intraday USDCAD technicals are bearish while trading below 1.1290 looking for a break of support at 1.1260 to extend losses to 1.1220. A move above 1.1290 will lead to 1.1310 and then 1.1340. The short term technicals remain USDCAD bullish with the uptrend line from mid-September intact above 1.1250
Today’s Range 1.1260-1.1310