USD/CAD – Loonie Starts Week At Multi-Year Lows

USD/CAD is rangebound in Monday trading, as the Canadian dollar trades at low levels. Early in Monday’s North American session, the pair is trading above the 1.12 line. It’s a very quiet day on the release front. In the US, Flash Manufacturing PMI weakened in February and fell short of the estimate. Across the border, BOC Deputy Governor Timothy Lane will deliver remarks at an event in Toronto. This is the only Canadian event this week.

The US dollar surged against its major rivals following the Federal Reserve’s policy meeting on Wednesday, the first meeting headed by Janet Yellen. The decision to trim QE by another $10 billion was widely expected, but her comments at the follow-up press conference gave the dollar a big boost against its major rivals. Yellen said that the Fed was on track to wind up QE in the fall, and could start to raise interest rates six months later. This is a more aggressive approach towards higher rates than the markets had expected, and the dollar responded by posting strong against the yen.

The Ukrainian crisis is deepening. Russian President Vladimir Putin signed a deal on Friday which formally annexed Crimea to Russia, while Western countries are scrambling to respond to Russia’s lightning takeover of the Ukrainian region. The commander of U.S. and NATO forces in Europe said that Russia had assembled a large force on Ukraine’s eastern border and could attack at any time. Meanwhile, Ukraine says it has ordered its troops in Crimea to withdraw to the mainland, in order to de-escalate the extremely tense situation. The troop withdrawal marks a tacit recognition of the Russian annexation of Crimea.

USD/CAD for Monday, March 24, 2014

USD/CAD March 24 at 15:30 GMT

USD/CAD 1.1221 H: 1.1246 L: 1.1203

USD/CAD Technical

• USD/CAD is rangebound in Monday trading. The pair dropped to a low of 1.1202 early in the North American session.
• 1.1177 continues to provide support. This is followed by support at 1.1094.
• 1.1319 is the next resistance line. It is followed by resistance at 1.1496, which has held firm since July 2009.
• Current range: 1.1177 to 1.1319

Further levels in both directions:

• Below: 1.1177, 1.1094, 1.1000, 1.0906 and 1.0852
• Above: 1.1319, 1.1496, 1.1639 and 1.1876

OANDA’s Open Positions Ratio

USD/CAD ratio is almost unchanged in Monday trade. This is consistent with what we are seeing from the pair, which is showing little movement. The ratio has a strong majority of short positions, indicating trader bias towards the loonie gaining ground.

USD/CAD continues to trade at high levels. The pair is steady in the North American session.

USD/CAD Fundamentals

• 13:45 US Flash Manufacturing PMI. Estimate 56.6 points. Actual 55.5 points.
• 4:30 BOC Deputy Governor Timothy Lane Speaks.
• All Day – G7 Meetings.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.