USD/CAD – Little Movement As Ukraine Crisis In Spotlight

USD/CAD has edged lower in Monday trading, as the Canadian dollar trades in the high-1.10 range. In economic news, Canadian Foreign Securities Purchases fell short of expectations. In the US, the Empire State Manufacturing Index missed the estimate but Industrial Production posted a strong gain. Meanwhile, the crisis in the Ukraine continues to dominate the news, and has dampened market sentiment.

It’s being described as the worst crisis on the European continent since the end of the Cold War. On Sunday, Crimea, a southern region of the Ukraine, voted overwhelmingly to leave the Ukraine and join Russia. The results brought joy to most residents of Crimea, who are of Russian ethnicity. However, the vote has been sharply denounced by the EU and the US as illegal, and both have warned Russia against annexing the region. Western nations are expected to impose stiff sanctions if Russia does not step back and respect Ukrainian sovereignty, but Moscow has not given any indication of backing down. The standoff between East and West is likely to get worse, and the turmoil could well affect the markets this week.

In the US, concern about the job market eased after a solid Unemployment Claims release. The key indicator dropped to 315 thousand, down from 323 thousand the previous week. This beat the estimate of 334 thousand. This was the second straight drop for the key employment indicator. Core Retail Sales and Retail Sales both posted gains of 0.3%, which were within market expectations. These indicators are the primary gauges of consumer spending, and although the gains were modest, they mark an improvement over the January readings.

 

USD/CAD for Monday, March 17, 2014

Forex Rate Graph 21/1/13

USD/CAD March 17 at 14:15 GMT

USD/CAD 1.1073 H: 1.1103 L: 1.1045

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.0852 1.0906 1.1000 1.1094 1.1177 1.1319

 

  • USD/CAD has edged lower on Monday. The pair touched a high of 1.1103 late in the Asian session but retracted.
  • The key level of 1.10 is providing support. Next is support at 1.0906, protecting the 1.09 level.
  • 1.1094 continues to provide resistance. It is a weak line and could be tested during the day. This is followed by strong resistance at 1.1177.
  • Current range: 1.10 to 1.1094

Further levels in both directions:

  • Below: 1.1000, 1.0906, 1.0852 and 1.0783
  • Above: 1.1094, 1.1177, 1.1319, 1.1496 and 1.1639

 

OANDA’s Open Positions Ratio

USD/CAD ratio is showing gains in long positions on Monday. This is not consistent with what we are seeing from the pair, as the Canadian dollar has moved higher. The ratio has a majority of short positions, indicating trader bias towards the loonie continuing to move higher.

The Canadian dollar has posted gains in Monday trading. The pair is steady early in the North American session.

 

USD/CAD Fundamentals

  • 12:30 Canadian Foreign Securities Purchases. Estimate 3.24B. Actual 1.09B.
  • 12:30 US Empire State Manufacturing Index. Estimate 6.6 points. Actual 5.6 points.
  • 13:15 US Capacity Utilization Rate. Estimate 78.7%. Actual 78.8%.
  • 13:15 US Industrial Production. Estimate 0.2%. Actual 0.6%.
  • 14:00 US NAHB Housing Market. Estimate 50 points.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.