USD/CAD – Loonie Finally Breaks Below 1.10

The Canadian dollar managed to push aside the stubborn 1.10 level on Tuesday, as USD/CAD dropped below the key barrier for the first time in two weeks. The pair is trading in the mid-1.09 range in the North American session. In economic news, Tuesday has a light schedule. US Consumer Confidence continued to post strong numbers in the March release, although the indicator fell short of the estimate. North of the border, Bank of Canada Governor  Stephen Poloz will testify before the House of Commons Standing Committee on Finance in Ottawa.

US consumers appear to be optimistic about the economy, according to the latest consumer confidence data. CB Consumer Confidence, a key indicator, posted its second straight reading of 82.3 points in March. This was shy of the estimate of 82.9, but the indicator remains at high levels. Earlier in the week, the UoM Consumer Sentiment jumped to 84.1 points in March, beating the estimate of 83.2. It marked the indicator’s highest level since June. If this optimism continues and translates into increased consumer spending, this should bode well for the US economy.

US housing numbers were a major disappointment last week, but it was a different story on Monday, as Pending Home Sales soared in March. The key indicator jumped 3.4%, easily beating the estimate of 1.0%. This marked its biggest monthly gain since last May. The indicator has posted mostly declines in recent readings, so the strong gain was welcome news. Meanwhile, US consumers appear to be content, as the UoM Consumer Sentiment jumped to 84.1 points in March, beating the estimate of 83.2. It marked the indicator’s highest level since June. If the optimism continues and translates into increased consumer spending, this should bode well for the US economy.

 

USD/CAD for Tuesday, April 29, 2014

Forex Rate Graph 21/1/13

USD/CAD April 29 at 15:50 GMT

USD/CAD 1.0964 H: 1.1026 L: 1.1057

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.0777 1.0852 1.0906 1.10 1.1094 1.1177

 

  • USD/CAD has moved lower in Tuesday trading. The pair dropped below the key 1.10 level early in the European session.
  • 1.0906 is providing support. There is followed by a support line at 1.0852, which has held since January.
  • 1.10 has switched to a resistance line as the Canadian dollar has improved. This is followed by 1.1177.
  • Current range: 1.0906 to 1.10

Further levels in both directions:

  • Below: 1.0906, 1.0852, 1.0775 and 1.0706
  • Above: 1.10, 1.1094, 1.1177, 1.1319 and 1.1496

 

OANDA’s Open Positions Ratio

USD/CAD ratio remains almost unchanged on Tuesday, continuing the trend we saw a day earlier. This is not reflected in the current movement of the pair, as the Canadian dollar has posted gains. The ratio is currently split between open long and short positions, indicating a lack of bias as to what direction the pair might take.

The Canadian dollar has broken below the 1.10 line on Tuesday. In the North American session, the US dollar remains under pressure.

 

USD/CAD Fundamentals

  • 13:00 US S&P/CS Composite-20 HPI. Estimate 12.9%. Actual 12.9%.
  • 14:00 US CB Consumer Confidence. Estimate 82.9 points. Actual 82.3 points.
  • 19:30 Bank of Canada Governor Stephen Poloz Speaks.

*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.