USD/CAD – Steady as Yellen Testifies in Washington

The Canadian dollar is steady on Tuesday, as USD/CAD trades in the low-1.26 range. In Canada, BOC Governor Stephen Poloz will speak at an event in London, Ontario. In the US, Federal Reserve head Janet Yellen will testify before the Senate Banking Committee. Earlier, CB Consumer Confidence slipped to 96.4 points, shy of the forecast of 99.6 points.

The markets will be keeping a close eye on Federal Reserve chair Janet Yellen, who testifies before the Senate Banking Committee later on Tuesday. Last week’s Fed minutes were dovish in stance, as policymakers expressed concern about a mid-year rate hike hurting the US recovery. Will Yellen provide any hints about the timing of a rate hike? If she does, we could see some movement from USD/CAD.

US releases started the week on a sour note, as Existing Home Sales slipped to 4.82 million in January, well off the estimate of 5.03 million. This marked a 9-month low for the key indicator. We’ll get a look at New Home Sales on Wednesday. Late last week, US key numbers were mixed. Unemployment Claims rebounded strongly with a sharp drop of 283 thousand, compared to 304 thousand a week earlier. This easily beat the estimate of 293 thousand. The news was not as good from the Philly Fed Manufacturing Index, which slipped to 5.2 points, down from 6.3 points and a third straight drop. The markets had expected a reading of 8.8 points.

USD/CAD for Tuesday, February 24, 2015

USD/CAD February 24 at 16:45 GMT

USD/CAD 1.2625 H: 1.2663 L: 1.2564

USD/CAD Technical

• USD/CAD posted slight gains in the Asian session. The pair moved higher in the European session, but was unable to consolidate these gains. The pair is unchanged in North American trade.
• 1.2680 is a weak resistance line. 1.2761 is stronger.
• 1.2543 has some breathing room as a support level.
• Current range: 1.2543 to 1.2680

Further levels in both directions:

• Below: 1.2543, 1.2469, 1.2387, 1.2261 and 1.2190
• Above: 1.2680, 1.2761 and 1.2950 and 1.3063

OANDA’s Open Positions Ratio

USD/CAD ratio is pointing to gains in long positions on Tuesday, reversing the direction we saw a day earlier. This is consistent with the pair’s movement, as the Canadian dollar has posted small losses. The ratio has a majority of short positions, indicative of trader bias towards USD/CAD moving to lower ground.

USD/CAD Fundamentals

• 13:30 US Corporate Profits. Estimate -2.8%.
• 14:00 US S&P/Composite-20 HPI. Estimate 4.5%. Actual 4.5%.
• 14:45 US Flash Services PMI. Estimate 54.5 points. Actual 57.0 points.
• 14:59 US Richmond Manufacturing Index. Estimate 7 points. Actual 0 points.
• 15:00 US CB Consumer Confidence. Estimate 99.6 points. Actual 96.4 points.
• 15:00 US Federal Reserve Janet Yellen Testifies.
• 19:00 BOC 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.