GFX Morning FX Commentary, March 20th, 2012

Good Morning,

Todays suggested range for the Canadian dollar against the US Dollar is .9850-.9950.

Todays suggested range for the Canadian dollar against the Euro is 1.3070-1.3170

Todays suggested range for the Canadian dollar against Sterling is 1.5700-1.5800

The US Dollar is marginally stronger this morning as investors concerns on global growth are weighing on the equity markets. Overnight equity markets were all weaker as the mining giant BHP Billiton said they expect China’s demand for raw materials to drop considerably. EURO.USD which had been trading at 1.3235 fell to trade at 1.3190 this morning and looks like the Euro still wants to trade weaker and with North American markets going to be in the red to start the day it should be a good day for the US Dollar.

With the comments about China from BHP the so-called commodity currencies all gave up strength overnight including the Canadian dollar, any drop in Chinese demand for raw materials would be very bad for the economies of the countries that produce raw materials. Yesterday saw the Loonie start to trade back towards the .9875 level but that trend was quickly reversed overnight on the BHP report and USD.CAD now looks like it wants to test back towards .9950 at some point today. Basically we are stuck in this very uninspiring .9850 to .9950 range and we are going to need a big development to get us out of that range, I am not sure what that will be but it will come, currency markets rarely stay this quiet for long.

For today with the North American markets pointing lower to start the day the first move of USD.CAD should be towards the .9950 level but given that is as high as we have seen in the past few weeks I think it will run into some resistance there, US Dollar sellers may want to put their short-term orders just ahead of this level to stand a good chance of getting filled, US Dollar buyers should leave their orders just below the .9900 level and you will have a good chance of getting filled today.

The Loonie remains weak against the other currencies EURO.CAD looks like it wants to try and get back above the 1.3100 level, if you need to buy some Euro look at 1.3050 to 1.3070  as good levels to pick some up cheap. GBP.CAD is approaching its recent highs so if you need some Sterling look towards the 1.5700 level as a good buying opportunity.

Have a great day

Mike

GFX Morning Currency Rates
Tuesday, March 20th, 2012
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9916			0.9917
CAD/USD		1.0085			1.0084
EUR/USD		1.3202			1.3166
EUR/CAD		1.3094			1.306
STG/CAD		1.5733			1.5725
AUD/CAD		1.0482			1.0501
CAD/JPY		84.44			83.76
CAD/CHF		0.9207			0.9233
CAD/HKD		7.8273			7.8255
CAD/CNY					6.3712
Commodities
Gold		$1,648			$1,654
OIL		$107.28			$106.73
Option Volatility
Canada
O/N		10.80%			10.90%
1 Week		8.22%			8.28%
1 Month		8.08%			8.17%