GFX Morning FX Commentary January 31st, 2013

Good Morning

Today's expected range for the Canadian Dollar against the US Dollar is .9980-1.0060

Today's expected range for the Canadian Dollar against the Euro is 1.3550-1.3625

Today's expected range for the Canadian Dollar against Sterling is 1.5810-1.5900

The US Dollar is marginally stronger this morning as a poor German Retail Sales report has investors questioning the extent of the Euro-Zone recovery. The EURO.USD bounced lower after it traded at a 13-month high at 1.3584, I would now think with the recent strength in the Euro that we should start to see some resistance build up as EURO.USD reaches 1.3600, I would not be surprised to if we were to see the Euro start to pullback a bit from these levels.

Yesterday the US Federal Reserve indicated that the US economic expansion was slowed by “transitory issues” in the fourth quarter of last year, in their statement they showed no signs of ending their stimulus program anytime soon. There was virtually no reaction to this announcement by the currency markets as it really is just a stay the course plan, going forward over the next month it should be equity market positive and US Dollar negative.

The Canadian Dollar continues to trade in narrow overnight ranges as it awaits its next move, it seems to be favouring a break back below par which would not be surprising as anytime we see significant movement higher for USD.CAD over a short-period like we have in the past week we usually get some kind of a pull back before the next move. US Dollar buyers may want to think about leaving some orders close to the market to take advantage of this move.

Up today we get the release of the Canadian GDP report for November where we are expecting a growth rate of 0.2% which, given the US slowing economy would not be a bad number. If the number is less than expectation and shows a slowing Canadian economy then we should see some fireworks and USD.CAD should move back higher. We do also get some secondary US data this morning as market set up for tomorrow morning’s US Employment report, there is a very good chance that we could see some enhanced volatility this morning.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0024			1.002
CAD/USD		0.9976			0.998
EUR/USD		1.3548			1.3543
EUR/CAD		1.3584			1.3574
STG/CAD		1.5829			1.5806
AUD/CAD		1.041			1.0451
CAD/JPY		90.76			91.06
CAD/CHF		90.9			0.9147
CAD/HKD		7.7164			7.7373
CAD/CNY		6.2			6.2058
CAD/MXN					12.6836
Commodities
Gold		$1,675			$1,664
OIL		$97.75			$97.88
Option Volatility
Canada
O/N		10.36%			10.79%
1 Week		6.84%			7.13%
1 Month		6.28%			6.51%

 

 

GFX Morning Commentary January 30th, 2013

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9980-1.0080

Today’s expected range for the Canadian Dollar against the Euro is 1.3560-1.3680

Today’s expected range for the Canadian Dollar against Sterling is 1.5800-1.5900   

The US Dollar is weaker to start the day as the EURO.USD has jumped to the 1.3560 level and EURO.CAD has risen to trade at 1.3600 during the night. In Europe this morning a Business Confidence survey reported much higher than expected as business in the region seems to be on a positive footing with the financial crisis calming down for the time being, this is the strongest the Euro has been since May 2012.

The Canadian Dollar spent the afternoon yesterday slowly getting stronger and at one point overnight it though about breaking through parity but it has bounced of that level and USD.CAD is again pushing higher this morning.

Today’s currency trading will be dominated first by the US GDP report for the 4^th quarter of last year and then by the US Federal Reserve announcement on interest rates this afternoon. For the US GDP we are expecting a growth rate of 1.2% for the quarter, if this number is lower than expected it will signal a slowdown in the economy, stocks will give up some strength and the US Dollar should jump higher, if it is a strong report then just the opposite should happen.

This afternoon the Fed will almost certainly keep interest rates at current levels but markets will be watching to see if they announce an end to their stimulus program, if they do look for equity markets to get hit and the US Dollar to jump higher, if they continue with the stimulus then we should see the US Dollar fall back and equities jump.

Today could be a very volatile day so make sure you get your orders in  early. If anything happens around the Fed announcement I will send out a currency alert.

Have a great day.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.002			1.0061
CAD/USD		0.998			0.9939
EUR/USD		1.3543			1.3428
EUR/CAD		1.3574			1.3512
STG/CAD		1.5806			1.5838
AUD/CAD		1.0451			1.0509
CAD/JPY		91.06			89.86
CAD/CHF		0.9147			0.9183
CAD/HKD		7.7373			7.7059
CAD/CNY		6.2058			6.1874
CAD/MXN		12.6836			12.6958
Commodities
Gold		$1,664			$1,661
OIL		$97.88			$96.41
Option Volatility
Canada
O/N		10.79%			10.24%
1 Week		7.13%			7.23%
1 Month		6.51%			6.66%

 

GFX Morning FX Commentary January 29th, 2013

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0025-1.0075    

Today’s expected range for the Canadian Dollar against the Euro is 1.3475-1.3575

Today’s expected range for the Canadian Dollar against the US Dollar is 1.5710-1.5780

The US Dollar is marginally stronger this morning as investor expectation rises that consumers are losing confidence in the US economy (report due out this morning) and that the US Federal Reserve will not make any changes to its stimulus program when it makes it interest rate announcement tomorrow. EURO.USD has traded to a high of 1.3460 before trading down to 1.3430, Sterling is also weaker with GBP.USD falling to trade at 1.5720.

The Canadian market was once again very quiet with USD.CAD now looking to settle in around the 1.0050 level as it awaits its next move, the longer we sit at this level the more resistance will build on the top side and eventually we will see USD.CAD move back down for a bit of a correction.

With only the US Consumer Confidence report due out today USD.CAD should trade in a narrow range ahead of tomorrow’s Federal Reserve announcement, where as I mentioned currency traders will be looking for any sign from the Fed that they are planning to exit their stimulus program. US Dollar sellers should want to leave their order between 1.0075 and 1.0100 and intra-day US dollar buyers should look to 1.0025 as a good level to buy some on a pullback. The Loonie remains weak against the Euro, Euro buyers should jump at the chance to buy some if you see it trade back towards 1.3475 today.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0061			1.0098
CAD/USD		0.9939			0.9902
EUR/USD		1.3428			1.3437
EUR/CAD		1.3512			1.357
STG/CAD		1.5838			1.5867
AUD/CAD		1.0509			1.0387
CAD/JPY		89.86			89.59
CAD/CHF		0.9183			0.9155
CAD/HKD		7.7059			7.6765
CAD/CNY		6.1874			6.164
CAD/MXN		12.6958
Commodities
Gold		$1,661			$1,656
OIL		$96.41			$95.83
Option Volatility
Canada
O/N		10.24%			9.36%
1 Week		7.23%			7.03%
1 Month		6.66%			6.55%

 

 

GFX Morning FX Commentary January 28th, 2013

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0045-1.0125

Today's expected range for the Canadian Dollar against the Euro is 1.3530-1.3600

Today's expected range for the Canadian Dollar against Sterling is 1.5840-1.5920

The US Dollar is marginally stronger to start the new North American trading week, as Yen and Sterling dominated the currency trading markets. In Japan the Yen rallied as currency speculators bought the Yen on the belief that the currency may have become too weak too fast, In the UK a poor housing report have just reinforced the notion that the UK economy remains in recession, Mark Carney has a tough job ahead of him, that fact is certain. Carney was in Davos for World Economic Forum and stated that the world’s central banks have more room for fiscal stimulus and have room to let inflation grow.

The Canadian dollar is weaker this morning has it now sets up for a test of 1.0100, the Loonie continues to weaken against the EURO has EURO.CAD now trades well above 1.3500. The Loonie is certainly under pressure at the moment and US Dollar sellers still need to take advantage of this move, If you are a short-term US Dollar buyer look for pullback towards the 1.0050 level to leave some buy orders.

 

Up today we do have the US Durable Good December report but I would not expect for it have a lot of impact on today’s trading, look for USD.CAD to test the 1.0100 level at some point today or early this week, I would not expect it to push through on its first attempt but we should see a test at some point. If we move back towards 1.0050 today and get a stronger close for the Loonie, we may see the recent run for the USD taper off.
 

Have a great week

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0098			1.0041
CAD/USD		0.9902			0.9959
EUR/USD		1.3437			1.3442
EUR/CAD		1.357			1.3486
STG/CAD		1.5867			1.5851
AUD/CAD		1.0387			1.0489
CAD/JPY		89.59			90.48
CAD/CHF		0.9155			0.9167
CAD/HKD		7.6765			7.7073
CAD/CNY		6.164			6.1883
CAD/MXN
Commodities
Gold		$1,656			$1,666
OIL		$95.83			$96.32
Option Volatility
Canada
O/N		9.36%			6.45%
1 Week		7.03%			7.15%
1 Month		6.55%			6.18%

GFX Morning Commentary January 25th, 2013

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0000-1.0075

Today’s expected range for the Canadian Dollar against the Euro is 1.3500-1.3600

Today’s expected range for the Canadian Dollar against Sterling is 1.5870-1.5970

The US Dollar is marginally weaker as the Euro continues its current run and currency markets are still being dominated by Yen trading. EURO.USD rose to trade as 1.3460 as German Business Confidence rose for a third month in January and the ECB announced that sovereign borrows are paying back more money that was loaned out quicker than expected.

Sterling is struggling this morning as the UK GDP report showed that the economy shrank in the 4^th quarter by 0.3%, it now appears certain the UK will fall into a triple dip recession, this economy just cannot get any traction.

The Canadian Dollar had a very quiet overnight session, in fact it hardly traded at all but the Loonie still trades with a weak bias this morning. With the strength of the Euro the Loonie is under immense pressure at the moment, just last week EURO.CAD was at 1.3100 where we recommended Euro buyers to try and buy some, today EURO.CAD has reached a high of 1.3525 which is a huge jump. Compared to the Euro the Loonie is doing relatively well against the USD, I think when we see a turnaround in EURO.CAD we will start to see USD.CAD move back down.

Up today we do have the Canadian CPI report where we are expecting a monthly drop of 0.2% in December. I don’t think that the currency market will pay that much attention to the inflation rate as it has been benign for a while now, with US equity markets pointing lower today I look for USD.CAD to try and break higher but it may have a tough time with lots of US Dollar sellers around.

 

Have a great weekend

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0041			1.0006
CAD/USD		0.9959			0.9994
EUR/USD		1.3442			1.3325
EUR/CAD		1.3486			1.3335
STG/CAD		1.5831			1.584
AUD/CAD		1.0489			1.0504
CAD/JPY		0.9048			89.27
CAD/CHF		0.9167			0.9268
CAD/HKD		7.7073			7.7276
CAD/CNY		6.1883			6.2142
CAD/MXN					12.6894
Commodities
Gold		$1,665.94			$1,677
OIL		$96.32			$95.44
Option Volatility
Canada
O/N		6.45%			7.50%
1 Week		7.15%			6.15%
1 Month		6.18%			5.90%