USDCAD Overnight Range 1.2717-1.2802

News that Iran signed a nuclear deal with the US, UK, Germany, France, Russia and China sent oil prices lower and USDCAD higher in overnight trading. The Loonie looked like it had one wing in the grave when New York traders started their day. That wasn’t to be. A bout of profit taking in WTI oil lifted the price from $50.17 to $52.15 which helped to cap USDCAD gains. Then came the release of another disappointing US retail Sales number (down 0.3% vs. forecast for a gain of 0.3%) which sent USDCAD tumbling through support at 1.2760, triggering stop losses and reaching a low 1.2717. It has since bounced back and is currently at 1.2755.

The weak US retail sales number may temper any hawkish inclinations in Fed Chair Yellen’s testimony to Congress, tomorrow.

It was a lively overnight session with AUDUSD and USDJPY both climbing in Asia. Aussie was bid following an improvement in NAB business conditions while JPY was sold ahead of the two day BoJ meeting and Fed Chair Yellen’s testimony to Congress, tomorrow. China equity markets retreated which raised questions about the effectiveness of the recent official intervention.

Cable caught a bid in Europe after Bank of England governor, Mark Carney, used “interest rate hike” in a sentence alluding to a “rate hike getting closer” in testimony to the UK Commons Treasury Panel. GBPUSD jumped 0.0150 points in a flash.

The Greek/EU debt deal is only a deal if PM Tsipras can convince the Greek parliament to pass the deal into law and comply with EU demands by tomorrow. That is far from a sure thing, especially since the media has be swamped with reports that Tsipras negotiated a far worse deal than what was previously offered.

Technical Outlook

The intraday technicals are modestly bearish following the failure to extend gains above 1.2800 and the subsequent retracement below 1.2760 which implies intraday consolidation in a 1.2710-1.2800 range. However, the uptrend remains intact above 1.2690-1.2700 which is looking for a break of resistance in the 1.2820-50 area to extend gains to 1.3050. For today, USD Support is at 1.2730 and 1.2690. Resistance is at 1.2790 and 1.2820

Today’s Range 1.2720-1.2790

Chart: USDCAD 4 hour