Loonieviews 27Sep16

Loonie aflutter on oil and debate

USDCAD Open (6:00 am) 1.3211-15 Overnight Range 1.3166-1.3273 27 Sept 16


NOTE: This chart represents gain (or loss) of G10 currencies vs the US dollar from NY close (4:00 pm) to Sept. 26, 6:00 am EDT

The Loonie was bouncing off the walls like a toddler in a bouncy castle in overnight trading. The Clinton/Trump debate was the focus in Asia markets. At one point, USDCAD touched 1.3273 triggering stops above 1.3250 although that move is an aberration due to the thin USDCAD conditions in Asia. Trump puckered his lips like a catfish on a sand-bar while shouting “Worst Deal Ever”. Hillary smiled and thought “Gee, I’m going to be president. When the dust had settled the media declared Clinton the victor and USDCAD retreated to 1.3166. Bank of Canada Governor, Stephen Poloz didn’t offer any fresh insight into monetary policy in his speech at Western Washington University.

Later on, the news from Algiers wasn’t all that great. Saudi Arabia reminded oil traders that the meeting was merely a consultative process and oil prices fell. That was enough for USDCAD bulls to re-buy the currency.

Elsewhere, USDJPY traders liked what they saw in the debate. USDJPY recouped all of Monday’s losses in Asia but that move didn’t last and by mid-morning in Europe, it was back to Monday’s closing level. EURUSD was sidelined in Asia and a European attempt to push the single currency above 1.1258 failed, although the retreat was very shallow. GBPUSD rallied to 1.3006 in Asia on a bit of a short squeeze and then retreated back to 1.2955 in Europe.

FX markets will be vulnerable to headlines today. The Opec meeting is still going on which leaves WTI exposed to price swings, and by default USDCAD. Federal Reserve Vice chairman Stanley Fisher is speaking at noon and could remind markets that US rates may rise in December. The US releases Markit Services PMI, Consumer confidence this morning and the A{I weekly Crude stocks change report at the end of the day.

USDCAD technical outlook.

USDCAD technicals are bullish while trading above 1.3170 supported by last week’s break on minor resistance at 1.3080. The break above resistance at 1.3250 overnight may prove to be just a ”blip” in thin Asia markets which will be confirmed if 1.3250 contains topside moves today. For today, USDCAD support is at 1.3170, 1.3140 and 1.3080. Resistance is at 1.3250-70, 1.3290 and 1.3330.

Today’s Range 1.3150 1.3250

Categories FX, Foreign Exchange, Currency, Canadian Dollar

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

search previous next tag category expand menu location phone mail time cart zoom edit close