General Inquiries: 1-888-223-3934 | Trading Desk: 1-888-729-9716
Privacy Policy Contact us User Login

2018-08-08 08:15

USDCAD surges yesterday. Saudi Arabia begins selling Canadian assets. Weekly oil inventory data on deck.

Source: EBC Trading Desk


  • USDCAD: Dollar/CAD is bid this morning after a scorching rally yesterday that caught many off guard.  Some chalked it up to the weaker than expected Canadian PMI print; some blamed it on a delayed reaction to the Saudi Arabia/Canada diplomatic spat over the arrest of a female activist, and some blamed it on flows from big funds.  Either way, USDCAD regained the 1.2970s (which it lost early yesterday), blew through trend-line channel resistance at 1.3025 and quickly tested resistance in the 1.3070s.  Overnight action has been supportive for the most part, with USDCNH strength and crude oil weakness in Europe providing a broad USD bid.  We now enter NY trading to headlines that Canadian Building Permits missed expectations for June (-2.3% MoM vs. +1.0% expected) and Saudi Arabia has instructed their overseas asset managers to dispose of their Canadian equities, bonds and cash holdings “no matter what the cost”.  The Financial Times is also now reporting that this selling began yesterday (which neatly explains yesterday’s USDCAD move).  More here:  USDCAD has punched above the 1.31 handle in response but has since settled back down to levels before the Saudi headlines crossed.  We think the market cools off here a tad given the market has rejected resistance here despite a number of CAD negatives.  Next up is the weekly crude oil inventory data at 10:30pmET (expectations are for a draw of 3.3mln barrels).  Tomorrow features Canadian Housing Starts and US PPI.


Tune in @EBCTradeDesk for more real-time market coverage.


Market Analysis Charts

USD/CAD Daily Chart

USD/CAD Hourly Chart

September Crude Oil Chart

Charts: TWS Workspace

About the Author

Erik Bregar

Erik Bregar - Director, FX Trading

linkedin twitter

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.

Interested in creating a custom foreign exchange trading plan? Contact Us or call EBC's trading desk directly at 1-888-729-9716.

About Exchange Bank of Canada
Exchange Bank of Canada (EBC) is a Schedule 1 bank based in Toronto, Canada. EBC specializes in foreign exchange services and international payments providing a wide range of services to financial institutions and corporations, including banknote foreign currency exchange, travelers' cheques, foreign currency cheque clearing, foreign currency bank drafts, Global EFT and international wire transfers through the use of EBC's innovative EBCFX web-based FX software

Disclaimer: All product names, logos, and brands are property of their respective owners. All company, product and service names used in this website are for identification purposes only. Use of these names, logos, and brands does not imply endorsement.

This publication has been prepared by Exchange Bank of Canada for informational and marketing purposes only. Opinions, estimates and projections contained herein are our own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed reliable, but no representation or warranty, express or implied, is made as to their accuracy or completeness and neither the information nor the forecast shall be taken as a representation for which Exchange Bank of Canada, its affiliates or any of their employees incur any responsibility. Neither Exchange Bank of Canada nor its affiliates accept any liability whatsoever for any loss arising from any use of this information. This publication is not, and is not constructed as, an offer to sell or solicitation of any offer to buy any of the currencies referred to herein, nor shall this publication be construed as an opinion as to whether you should enter into any swap or trading strategy involving a swap or any other transaction. The general transaction, financial, educational and market information contained herein is not intended to be, and does not constitute, a recommendation of a swap or trading strategy involving a swap within the meaning of U.S. Commodity Futures Trading Commission Regulation 23.434 and Appendix A thereto. This material is not intended to be individually tailored to your needs or characteristics and should not be viewed as a "call to action" or suggestion that you enter into a swap or trading strategy involving a swap or any other transaction. You should note that the manner in which you implement any of the strategies set out in this publication may expose you to significant risk and you should carefully consider your ability to bear such risks through consultation with your own independent financial, legal, accounting, tax and other professional advisors. All Exchange Bank of Canada products and services are subject to the terms of applicable agreements and local regulations. This publication and all information, opinions and conclusions contained in it are protected by copyright. This information may not be reproduced in whole or in part, or referred to in any manner whatsoever nor may the information, opinions and conclusions contained in it be referred to without the prior express written consent of Exchange Bank of Canada.
Posted By Rachel Butler at 08:15 AM