Canadian dollar September 18, 2010
USD/CAD to consolidate with risks skewed higher. Pair buoyed by USD-short covering, softer commodity & oil prices (Nymex crude settled down $1.44 Friday at $81.25/bbl); expectations BOC could pause its monetary tightening campaign at tomorrow''''s policy announcement. But USD/CAD gains tempered by ultra-loose U.S. monetary policy; big 2.0% rise in Canadian August manufacturing shipments (vs +0.5% forecast). Data focus: 1230 GMT Canada August international transactions in securities. USD/CAD daily chart mixed as MACD bearish, but stochastics turned bullish at oversold. Resistance at 1.0138 (Friday''''s high); breach would expose upside to 1.0183 (Tuesday''''s high), then 1.0227 (Oct. 8 high), 1.0272 (Oct. 5 high) and 1.0313 (Oct. 1 high, near 55-day moving average). Support at 1.0008 (Friday''''s low), then at 0.9980 (Thursday''''s 5-month low); breach would reinstate near-term negative bias, exposing downside to 0.9926 (April 21 low), then 0.9816 (May 21, 2008 reaction low) and 0.9708 (Feb. 28, 2008 reaction low).