Waiting for Janet
USDCAD Open (6:00 am) 1.2920-24 Overnight Range 1.2903-1.2951 24Aug16
NOTE: This chart represents gain (or loss) of G10 currencies vs. the US dollar from NY close (4::00pm) to NY Open Aug 24, 6:00 am EDT
It was another overnight session where FX action was exciting as watching paint dry. A lack of major economic data and the Janet Yellen speech on Thursday evening at Jackson Hole is all the excuse traders needed to get back to playing Pokemon GO. USDCAD jumped in the Asia session following the release of the API Crude Stocks report showing a rise in inventories of 4..464 million barrels. The previous week had declined by 1.0 m/b. That rally ended when Europe walked in and USDCAD retreated back to where it was at the end of the day, in New York.
AUDUSD was under pressure in Asia due to general US dollar strength but it too, rallied during the European session. USDJPY see-sawed in a tight 100.00-100.25 range.
In Europe, EURUSD declined steadily while GBPUSD rallied. EURUSD sank in part due to position adjustments ahead of Janet Yellen’ speech on Thursday. GBPUSD rallied as traders trimmed extreme short positions.
All of the FX moves are occurring in an information vacuum and in thin trading conditions.
The wait for Ms. Yellen’s speech tomorrow, will ensure a dull day today. USDCAD traders will be waiting to see how the oil markets react to today’s EIA Crude stocks report. In addition, an earthquake in Italy and a US/Turkey offensive in Northern Syria will provide some distractions today.
USDCAD technical outlook.
The intraday USDCAD technicals have flipped back to bullish, supported by the move above 1.2930 and by the minor uptrend from the 1.2762 low, last Thursday. A break above 1.2980 is required to extend gains to the 1.3050-1.3070 resistance area. A move below 1.2850 argues for further weakness to 1.2760. In addition, the uptrend line from the June low of 1.2640 remains intact while prices are above 1.2760. For today, USDCAD support is at 1.2905 and 1.2880. Resistance is at 1.2950, 1.2980 and 1.3010.
Today’s Range 1.2910-80
Chart: USDCAD daily