Forex - USD/CAD trims losses after upbeat U.S. home sales data

Published 10/25/2010, 11:09 AM
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Investing.com – The U.S. dollar trimmed losses against its Canadian counterpart on Monday, easing off a 6-day low after the release of better-than-expected U.S. data on existing home sales.

USD/CAD retreated from 1.0153, the pair’s lowest since October 18, to hit 1.0192 during early U.S. trade, shedding 0.69%.

The pair was likely to find support at 1.0116 the low of October 18 and resistance at 1.0301, the high of October 22.

Earlier in the day, the National Association of Realtors said that existing home sales rose for the second consecutive month in September, rising to a seasonally adjusted annual rate of 4.53 million units, after rising to a revised 4.12 million units in August. Analysts had expected existing home sales to rise to a seasonally adjusted 4.25 million units in September.

Commenting on the report, Lawrence Yun, chief economist for NAR said, “A housing recovery is taking place, but will be choppy at times depending on the duration and impact of a foreclosure moratorium.”

He added, “the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions".

The loonie was also up against the euro, with EUR/CAD shedding 0.55% to hit 1.4244.

Over the weekend the leaders of the G20 group of industrial and emerging nations agreed on the need to refrain from currency devaluations and move toward market-based exchange-rate systems.

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