USDCAD holds near 5.5 year highs between 1.1927 - 1.2017

VBCE Daily Foreign Exchange Update for Wednesday, Jan. 14th, 2015

USDCAD spot rate: 1.1947 - 1.1952 (AS AT 8:53AM PST)

RANGES:	Asia:	1.1948	to	1.2009
	Europe:	1.1960	to	1.2017
	North America:	1.1927	to	1.1982

Technical Support / Resistance:

S2	S1	R1	R2
1.1800	1.1927	1.1984	1.2200

Key Economic Data Releases:

-U.S. retail sales: -0.9% (exp. -0.1%) ex autos: -1.0% (exp. 0.0%)

-U.S. business inventories: 0.2% (exp. 0.2%)

Key Event Calendar:

DATE	CANADA	U.S.A.
Jan. 15		Initial jobless claims, producer price index
Jan. 16		CPI, industrial production, consumer sentiment

Yesterday, USDCAD traded from 1.1943 up to 1.1993 only to fall back to 1.1926 as oil prices staged a recovery bouncing from $44.23 up to $46.37. With equity markets reversing course part-way into the North American session, (DJIA saw a 300+ pt reversal) USDCAD bounced to hold a 1.1940/1.1970 range where it remained for the balance of the session. Overnight, copper prices dropped by as much as 8% (now down about 4%) and the JPY and USD rallied vs. the commodity based currencies. USDCAD briefly broke above 1.20 in late Asian / early European trade. The move was short-lived and USDCAD fell back to 1.1960 - below a key 1.1984 technical level. U.S. retail sales were weaker than expected and the World Bank revised its 2015 world economic growth forecast lower from 3.4% to 3.0%. The USD broadly weakened taking USDCAD down to 1.1927. The pairing was unable to break below this technical channel trend line for the 2ND straight day and has bounced to 1.1963. With oil prices remaining firm today (a dip to $45.04 was followed by a rise to $46.81), USDCAD has managed to dip back to 1.1940 and is currently holding a 1.1940 – 1.1960 range. Currently, the TSX and the DJIA are down 1.38% and 1.37% respectively. EURCAD is up 0.15% trading between 1.4058 and 1.4162. GBPCAD is up 0.50% trading between 1.8117 and 1.8245. JPYCAD is up 1% trading between 0.01013 and 0.01029. Gold is up 0.36% trading between $1,225 and $1,244USD/oz, silver is down 1% trading between $16.55 and $17.08USD/oz, while oil is up 0.37%, trading between $45.04 and $46.81.

Sources: Reuters, Bloomberg, FXStreet, RBC Capital Markets, Bank of Canada, U.S. Federal Reserve, CNBC, Forexlive