USD/CAD – Strong Greenback Pushes Above 1.25

The Canadian dollar is lower on Thursday, as USD/CAD trades in the low-1.25 range. On the release front, US unemployment claims looked excellent, dropping sharply to 283 thousand. However, the Philly Fed Manufacturing Index had a poor showing in February, dropping to 5.2 points. Today’s sole Canadian release is a speech from BoC Deputy Governor Agathe Cote in Quebec.

On Thursday, key US indicators 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 5.3 points and a third straight drop. The markets had expected a reading of 8.8 points.

On Wednesday, the Federal Reserve released the minutes of its previous policy meeting. The minutes were decidedly dovish in nature, as Fed policymakers raised concerns that a mid-year rate hike could hurt the economic recovery. The Fed also said it was worried about the impact of global events on the US economy, such as the slowdown in China and the Greek financial crisis. With US inflation at low levels, the Fed is not in any rush to raise rates, so speculation of a mid-year rate may have been premature.

USD/CAD for Thursday, February 19, 2015

USD/CAD February 19 at 15:40 GMT

USD/CAD 1.2523 H: 1.2553 L: 1.2437

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2261 1.2387 1.2469 1.2543 1.2680 1.2761

 

  • USD/CAD was flat in the Asian session. The pair posted strong gains in the European trade but has retracted in the North American session.
  • 1.2469 has strengthened is support as the Canadian dollar has posted gains.
  • 1.2543 is a weak resistance line. Will the pair break through in the North American session? 1.2680 is stronger.
  • Current range: 1.2469 to 1.2543

Further levels in both directions:

  • Below: 1.2469, 1.2387, 1.2261, 1.2190 and 1.2096
  • Above:1.2543, 1.2680, 1.2761 and 1.2950

 

OANDA’s Open Positions Ratio

USD/CAD ratio is pointing to gains in short positions on Thursday. This is not consistent with the pair’s movement, as the Canadian dollar has posted losses. The ratio is currently split between long and short positions, indicative of a lack of trader bias as to what direction USD/CAD will take next.

USD/CAD Fundamentals

  • 13:30 US Unemployment Claims. Estimate 293K. Actual 283 thousand.
  • 15:00 US Philly Fed Manufacturing Index. Estimate 8.8 points. Actual 5.2 points.
  • 15:00 US CB Leading Index. Estimate 0.4%. Actual 0.2%.
  • 15:30 US Natural Gas Storage. Estimate -110B. Actual -111B.
  • 16:00 US Crude Oil Inventories. Estimate -1.8M. Actual 7.7M.

*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.