USDCAD tests 1.20 and falls to 1.1926 as oil pares losses

VBCE Daily Foreign Exchange Update for Tuesday, Jan. 13th, 2015

USDCAD spot rate: 1.1940 - 1.1945 (AS AT 9:00AM PST)

RANGES:	Asia:	1.1943	to	1.1978
	Europe:	1.1956	to	1.1993
	North America:	1.1926	to	1.1983

Technical Support / Resistance:

S2	S1	R1	R2
1.1671	1.1800	1.1984	1.2200

Key Economic Data Releases:

-U.S. IBD/TIPP economic optimism index: 51.5 (exp. 48.9)

-U.S. JOLTS job openings: 4.97 million (exp. 4.863 million)

Key Event Calendar:

DATE	CANADA	U.S.A.
Jan. 14		Retail sales, business inventories
Jan. 15		Initial jobless claims, producer price index
Jan. 16		CPI, industrial production, consumer sentiment

Yesterday, USDCAD traded from 1.1836 up to 1.1974 – a new 5.5 year high, breaking above Friday’s high of 1.1890. Oil prices dropped by nearly 5% yesterday and for USDCAD, there has been very little in the way of technical resistance between 1.1600 and the psychological level of 1.20. Overnight during the Asian session, the pairing eased to 1.1943 as the USD broadly weakened. Data out of China showed that exports grew faster than expected (9.9% vs. 6.8%) while imports declined less than expected (-2.3% vs. -7.4%). The trend reversed during the London session with USDCAD attempting a test of 1.20. The pairing briefly broke through 1.1984 resistance peaking at 1.1993 as oil touched $44.23. The move was short-lived with oil bouncing to $46.37 and USDCAD falling back to 1.1926. The pairing has since bounced to 1.1950. Currently, the TSX and the DJIA are up 0.18% and 1.10% respectively. EURCAD is down 0.70% trading between 1.4037 and 1.4190. GBPCAD is down 0.35% trading between 1.8069 and 1.8174. JPYCAD is down 0.15% trading between 0.01006 and 0.01016. Gold is up 0.40% trading between $1,231 and $1,244USD/oz, silver is up 3.80% trading between $16.57 and $17.20USD/oz, while oil is down 0.90%, trading between $44.23 and $46.37.

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