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2018-03-15 08:15

USDCAD retains upward bias on broad USD bid. Quiet calendar for today and rest of week. CAD traders continue to add length in futures.

Source: EBC Trading Desk

Summary

  • USDCAD: Dollar/CAD is entering NY trading this morning with a firm bid as the broader USD is rebounding against AUD, GBP and EUR.  AUDUSD had a negative NY close (tracking copper prices), and that spilled over into further selling overnight.  GBPUSD failed for the 3rd time at trend-line resistance at 1.3980-90 in early London trade and is now falling apart.  Finally, EURUSD lost chart support in the 1.2370s.  All this is keeping USDCAD bid at this hour and on track to test overhead resistance between 1.2990 and 1.3010.  EURCAD and GBPCAD spent the better part of yesterday consolidating recent gains, but like USDCAD, the crosses are still in good shape technically.  The North American calendar is light today, with US Import Prices and the Philly Fed survey out at 8:30amET, and Canadian Existing Home Sales out at 9amET.  We think USDCAD retains its range-bound to upward bias for the time being, with the broader USD theme being the dominant driver of price action.  Tomorrow will be another quiet session for data (US Housing Starts and UofM survey), and then all eyes will turn to the FOMC meeting next week (March 21) where the Fed is expected to hike rates 25bp.  Canadian dollar futures traders added another 3888 contracts in new positions yesterday (now 15k+ contracts in new length over the last 4 days), which suggests a continued increase in new USDCAD spec longs and an increase in hedge sales from corporates.  We’ll know more in the CFTC Commitments of Traders (COT) data released tomorrow afternoon.

     

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Market Analysis Charts

USD/CAD Daily Chart

USD/CAD Hourly Chart

EUR/CAD Daily Chart

GBP/CAD Daily Chart

Charts: TWS Workspace


About the Author

Erik Bregar

Erik Bregar - Director, FX Trading

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Erik works with corporations and institutions to help them better navigate the currency markets. His desk provides fast, transparent, and low cost trade execution; up to the minute fundamental and technical market analysis; custom strategy development; and post-trade services -- all in an effort to add value to your firm’s bottom line. Erik has been trading currencies professionally and independently for more than 12 years. Prior to leading the trading desk at EBC, Erik was in charge of managing the foreign exchange risk for one of Canada’s largest independent broker-dealers.

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Posted By Rachel Butler at 08:15 AM