USD/CAD – Canadian Dollar Improves, US Home Sales Unchanged

The Canadian dollar has posted gains for a second straight day, as USD/CAD trades in the mid-1.24 range on Wednesday. In the US, Federal Reserve head Janet Yellen continues a second day of testimony in Congress. US New Home Sales remained unchanged at 481 thousand. There are no Canadian releases on Wednesday.

There was good news on from the US housing sector on Wednesday, as New Home Sales remained unchanged in January at 481 thousand. This easily beat the estimate of 471 thousand. Earlier in the week, Existing Home Sales dropped sharply to 4.82 million, a 9-month low. On Friday, we’ll get a look at Pending Home Sales, with the markets expecting strong gain of 2.5%, following a sharp decline of 3.7% in December.

Janet Yellen testified before a Senate committee on Tuesday, saying that the Fed was “unlikely” to raise interest rates in the next few months, given current economic conditions. Her remarks seemed aimed at quelling rising speculation about a rate hike sometime in mid-2015, which has helped boost the US dollar’s performance against its major rivals. Yellen noted that the continuing growth should lead to the unemployment rate continuing to fall. The Fed Chair will resume testimony before the House Financial Services Committee on Wednesday, but it’s not likely that Yellen’s comments will shake up the markets.

USD/CAD for Wednesday, February 25, 2015

USD/CAD February 25 at 14:55 GMT

USD/CAD 1.2455 H: 1.2663 L: 1.2564

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2190 1.2261 1.2387 1.2469 1.2543 1.2680

 

  • USD/CAD posted slight losses in the Asian session. The pair has been marked by choppy trading in the European and North American sessions.
  • 1.2469 is a weak resistance line. 1.2543 is stronger.
  • 1.2387 is an immediate support level.
  • Current range: 1.2387 to 1.2469

Further levels in both directions:

  • Below: 1.2387, 1.2261, 1.2190 and 1.2015
  • Above: 1.2469, 1.2543, 1.2680, 1.2761 and 1.2950

 

OANDA’s Open Positions Ratio

USD/CAD ratio is pointing to gains in long positions on Wednesday, continuing the direction we saw a day earlier. This is not consistent with the pair’s movement, as the Canadian dollar continues to post losses. The ratio has switched to a majority of long positions, indicative of trader bias towards USD/CAD moving to higher ground.

USD/CAD Fundamentals

  • 15:00 US Federal Reserve Chair Janet Yellen testifies in Congress.
  • 15:00 US New Home Sales. Estimate 471K. Actual 481K.
  • 15:00 US Mortgage Delinquencies. Actual 5.68%.
  • 15:30 US Crude Oil Inventories. Estimate 3.6M. Actual 8.4M.

*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.