USDCAD spot rate: 1.2360 - 1.2365 (AS AT 8:45AM PST)

 

 

**USDCAD near 6 year high trading between 1.2314 - 1.2389**

 

USDCAD spot rate: 1.2360 - 1.2365 (AS AT 8:45AM PST)

RANGES:	Asia:	1.2325	to	1.2374
	Europe:	1.2314	to	1.2375
	North America:	1.2331	to	1.2389

Technical Support / Resistance:

S2	S1	R1	R2
1.2200	1.2314	1.2394	1.2504

Key Economic Data Releases:

-U.S. initial jobless claims: 307,000 (exp. 300,000)

-U.S. housing price index: 0.8% (prev. 0.4%)

Key Event Calendar:

DATE	CANADA	U.S.A.
Jan. 23	CPI, retail sales	Markit mfg PMI, existing home sales

Yesterday, USDCAD traded from 1.2062 up to 1.2394 after the Bank of Canada shocked the markets with a 0.25% interest rate cut. The CAD had weakened in recent days with many market participants believing that the Bank of Canada would simply shift its rhetoric from neutral to slightly dovish. USDCAD eased to 1.2320 in late North American trading but resumed an upward trend in overnight trading. After reaching 1.2375, the pairing dropped to 1.2314 and then climbed to 1.2389 because of the volatility caused by the European Central Bank announcement.

The ECB introduced stimulus measures of EUR60 billion / month to start March 2015 and end in Sept. 2016. EURUSD has fallen to an 11 year low of 1.1400. USDCAD has since fallen to 1.2330 and bounced to 1.2375 where it seems to be running into resistance.

U.S. oil inventories were substantially higher at 10 million barrels vs exp. 2.6 million barrels and oil has fallen from $49 down to $46. USDCAD is now approaching levels not seen since the spring of 2009 during the financial crisis which saw USDCAD briefly trade between 1.2400 and 1.2900. The JPYCAD rate is near a 6 month high while GBPCAD is near a 6 year high. Tomorrow, Canadian CPI inflation data is expected to decline from 2.0% down to 1.5% while retail sales are expected to fall by 0.2%. Currently, the TSX and the DJIA are up 1% and 0.56% respectively. EURCAD is down 1.2% trading between 1.4383 and 1.4073. GBPCAD is down 0.35% trading between 1.8587 and 1.8797. JPYCAD is up 0.40% trading between 0.01045 and 0.01053. Gold is up 0.62% trading between $1,279 and $1,307USD/oz, silver is up 1%d trading between $17.93 and $18.41USD/oz, while oil is down 2.60%, trading between $45.99 and $49.14.

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