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The Currency Futures Report

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Canadian Sets New High for 2009

Tue, Jul 28 2009, 05:54 GMT
by Bob Kozak

Alaron

Canadian Dollar (CDU9):

The CD opened higher at .9247, after selling off at our initial Resistance level of .9279 and trading lower after posting a new Hi for 2009. As equity prices retraced from morning levels, the DX moved higher and weighed on CD prices. A late afternoon bounce in equity markets sent the DX lower and boosted the CD to a close of .9258, up 29 tics.The s/t trend remains 'positive' w/ over-bot momentum indicators. Higher global equity markets and weaker DX attribute to higher commodity prices, pushing the CD to a level that will possibly weigh on 'exports' and cause concern for the BoC at the next rate meeting. Longs should tighten 'stops' or buy 'puts' to reduce exposure. A higher open should find Resistance at .9294 and .9330, while an open below .9243 may find Support at .9207 and .9156.

Dollar Index (DXU9):

The DX opened lower at 78.56 and rose to a morning Hi at our Pivot level of 78.96 as equity retraced. Traders looking for the global economy to improve continue to reduce or adjust the need for 'safe-haven' benefits of the Dollar in their reserve portfolios. A bounce in the equity markets sent the DX lower into the day-session close of 78.755, down 14 tics. The s/t trend remains 'negative' w/ over-sold momentum indicators. The recent forecast of a major investment bank that the Euro will reach 1.4500 could add to the pressure from higher global equity prices. Shorts should tighten 'stops' or buy 'calls' to reduce exposure. A lower open may find Support at 78.46 and 78.18, while an open above 78.79 should find Resistance at 79.08 and 79.41.

Euro Currency (ECU9):

The EC opened higher at 1.4273 after retracing from the 1.4299 globex high and continued lower as equity markets retraced and the DX strengthened. Prices slid to our Pivot level morning Lo of 1.4202, before bouncing into the afternoon session. The EC followed equtiy prices higher towards the day-session close and ended the day at 1.4244, up 28 tics. An increase in German Consumer Confidence to a 14 month Hi helped off-set a decrease in bank lending activity. A bullish forecast by a major investment bank for the Euro to reach 1.4500, should see a test of the 6/3 Target Hi of 1.4327, near term. Longs should tighten 'stops' or buy 'puts' to reduce exposure. A higher open should find Resistance at 1.4305 and 1.4366, while an open below 1.4238 may find Support at 1.4177 and 1.4110.

Published on  Tue, Jul 28 2009, 05:56 GMT