Forex Investment and Currency Trading

The CAD has been a relative under performer in the overnight session (dragged down by weakness in the AUD and NZD) though the market remains somewhat low on conviction generally and thin and rather illiquid trading conditions continue to characterize USD/CAD trading. And with month-end on the horizon, the market has even less incentive to stick its collective neck out too far today. USD/CAD managed to grind steadily higher from yesterday’s 1.2030 low and while the high reached surpassed expectations slightly, funds still looks to be struggling to attract support above the 1.22 area. It appears, fact, as if the overnight high may well represent the top for the market for the session at least – and possibly a little longer. Overall, expect little support for the USD from this morning’s
durable goods, claims or housing data (while Canadian PPI data are likely to be mostly ignored) and look for USD/CAD to nudge lower again. Below short term trend support, expect USD/CAD to head back to the low/mid 1.20s at least and ultimately push back into the teens to retest the January lows.
Weaker crude prices remain a potential drag on the CAD today and moving forward.