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CANADA: USDCAD Again Reverts To 1.36 Before Risk Events

CANADA
GlobalCanadaBulletMarketsForeign Exchange BulletsRegionNorth America
  • USDCAD again approaches risk events close to the 1.36 handle, with the BoC minutes at 1330ET as a warm-up before of course a highly uncertain FOMC decision at 1400ET.
  • It earlier touched a low of 1.3577 before some intraday USD strength as yields drifted higher and WTI unrounded earlier gains.
  • With the Fed able to surprise in either direction, support is seen at 1.3547 (Sep 9 low) but with some way to the bear trigger at 1.3441 (Aug 28 low), whilst there is some closely packed resistance with 1.3623 (Sep 11 high) and 1.3625 (50-day EMA) before 1.3693 (Aug 19 high).
  • Tomorrow’s NY cut sees heaviest expiry nearby with $843m also at 1.3600.
  • In the event of any dovish surprises from the Fed, expect the USD to add an additional headwind for CAD on crosses, with the real effective exchange rate already hovering 2% below historical averages and around the 40th percentile for those ranges – see table. 
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  • USDCAD again approaches risk events close to the 1.36 handle, with the BoC minutes at 1330ET as a warm-up before of course a highly uncertain FOMC decision at 1400ET.
  • It earlier touched a low of 1.3577 before some intraday USD strength as yields drifted higher and WTI unrounded earlier gains.
  • With the Fed able to surprise in either direction, support is seen at 1.3547 (Sep 9 low) but with some way to the bear trigger at 1.3441 (Aug 28 low), whilst there is some closely packed resistance with 1.3623 (Sep 11 high) and 1.3625 (50-day EMA) before 1.3693 (Aug 19 high).
  • Tomorrow’s NY cut sees heaviest expiry nearby with $843m also at 1.3600.
  • In the event of any dovish surprises from the Fed, expect the USD to add an additional headwind for CAD on crosses, with the real effective exchange rate already hovering 2% below historical averages and around the 40th percentile for those ranges – see table.