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Forex Flash: USD/CAD in pullback to 1.0255/60 and maybe 1.0200/10 – TD Securities

The BoC managed to find a way to hold onto their mild hawkish bias, but rate hikes are now even more distant over the horizon.  “While the CAD sold off sharply on the announcement, the ‘lower for even longer’ message was not entirely surprising considering the string of weak Canadian data recently, and the fact that USD/CAD did not manage to make new highs for the year suggests some softening of the hawkish language was already priced in”, wrote analysts Shaun Osborne and Greg Moore, expecting tomorrow’s employment report to show more give-back of the strong increases in the final quarter of 2012. 

In regard to the USD/CAD, TD Securities analysts are now forecasting a peak in Q2 2013 at 1.06. For now, "inability to make new highs yesterday suggests the rally has lost some steam and increases the potential that we see a pullback in the coming days (without another strong catalyst—i.e. very weak employment)", they wrote, pointing to support at 1.0255/60 and a more solid one at 1.0200/10 area. "More broadly, we continue to look for an extension toward 1.0450 in the coming weeks", they added.

Last month of stable NFP growth in February before sequester brings uncertainty - Alexandra Estiot

Despite the fact that the US labor market was showing signs of improvement at the end of 2012 and in January 2013, many analysts believe that this positive trend might be coming to an end. In the opinion of Alexandra Estiot, Senior Economist at BNP Paribas, the February jobs numbers should still be decent, in the vicinity of 180K-200K, “but spring will be about uncertainty.”
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Forex Flash: 10-year US Treasuries point to consolidation – RBS

Investors continue to see a 1.70% to 2.13% range in 10-year US Treasuries. Key resistance remains 2.13% for 10-years, with first support at 1.94%. According to the RBS Research Team, “Near term support is 1.80%; a break through here should see extension towards 1.70%, though the daily charts continue to point to consolidation.”
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