The CAD has also been putting up large gains against its US counterpart, today.
Risk appetite, particularly for the industrial commodities, shot up after the positive manufacturing data out of China and a very positive quarter-over-quarter GDP figure out of Australia. Considering the giant consumer of materials that is China, it is easy to see how a report which confirms that growth is still robust could spur commodities prices higher. Copper, Platinum and, probably the most important commodity to the loonie, Crude Oil have all been soaring today. Confirming this sentiment and creating a win-win scenario for the CAD was a better than expected US Manufacturing PMI reading out of the United States. With both China and Canada’s largest trading partner the US providing economic indicators that seem to imply demand could strengthen for oil, the CAD roared higher. On the technical side, we are currently at a pretty interesting level. Once again yesterday the level near 1.0670 held firm and the resulting reaction, confirmed by the fundamentals has taken the USD/CAD pair down to a key zone of support between 1.0475 and 1.0500. This was the zone that was mentioned yesterday, and so far, over the last few hours it has held firm. If this level can hold any assault by the CAD bulls, the resulting bounce could favor a move back toward 1.0600. If risk appetite remains high, however, and this support zone fails the next area of support may not exist until the area between 1.0385 and 1.0410.
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