Can Dollar to US Dollar 8 Dec 2009

The shooting star candle on the usd to cad chart may yet be validated later today as the currency market waits for the Bank of Canada interest rate decision later.  Consensus of opinion seems to be for a hold at 0.25% but given yesterday excellent building permits data which came in at a stellar 18.0% against a forecast of a mere 1.1% the Bank’s statement will be scrutinzed even more closely.  Just prior to release of the interest rate decision the market will have had the Housing Starts data which is expected to come in at 159k – marginally better than the previous 157k.  However, should this too overshoot together with a hawkish tone from the BOC could see the US dollar continue its downwards slide against the Loonie and with Bernanke signalling yesterday no change to an “extended period” of low interest rates this afternoon’s activity should provide us with some excellent trading opportunities in this pair.

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Can Dollar to US Dollar 4 Dec 2009

The usd to cad continued to bounce around on the 1.05 price region, with counterbalancing signals between last Friday and that of a week earlier, with the first suggesting a fall based on the shooting star candle ( which arrived but failed to develop) followed by this weeks candle which closed on Friday with a narrow body but a deep lower shadow, suggesting that the bulls are temporarily back in charge of the usd to cad market!  With the currency pair now apparently finding some traction at the 1.04 price level, we may well see a continuation of this upwards momentum in the early part of the week for the usd to cad pair, but for this to be sustained, it will have to be coupled with a break and hold above the 1.11 price handle which is some way above the current price action at present, and in the short term the first target on the horizon is the minor resistance in the 1.08 price region, and until we see a sustained push above these level, then a further period of sideways consolidation seems likely in the short term.

The only item of fundamental news due for release today for Canada is the Building Permits data which is expected to come in 1.1% as opposed to the 1.6% previous figure.  Building Permits measures the change  in the total value of new building permits issued and is considered an important indicator of future construction activity.  Meanwhile in the US we have a speech from Bernanke as well as the consumer credit data – details of which can be found on the eurodollar site.

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Support & Resistance for USD to CAD :

S1:  1.0479     R1:  1.0637

S2:  1.0379     R2:  1.0695

S3:  1.0321     R3:  1.0795