CANADA FX DEBT-C$ down but rangebound, bonds eye Fed plan

Wed Mar 25, 2009 8:23am EDT
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* Canadian dollar slips, mixed influence from oil, stocks

* Bonds slightly lower, awaits supply and Fed's debt plan

TORONTO, March 25 (Reuters) - The Canadian dollar was softer versus the U.S. currency on Wednesday morning though largely rangebound as U.S. equity markets looked to open higher but oil prices were lower.

U.S. stock index futures pointed to a higher opening on Wednesday, while the price of oil fell more than $1 a barrel, giving the Canadian dollar mixed clues and leaving it tightly bound in this week's range so far between C$1.22 and C$1.24.

"By and large it looks like it's setting up to be a rangebound session. The breakout comes above C$1.25 or below C$1.22," said Jack Spitz, managing director of foreign exhange at National Bank Financial.

"There's a slight bias to take dollar/Canada towards the near-term resistance at C$1.2450 after yet another rejection of C$1.22. Technically speaking, there's a slightly bias to see dollar/Canada to trade toward the top-end of the near-term range," said Spitz.

The Canadian dollar hit a six-week high around the C$1.22 level on Monday but has since drifted lower.

At 8 a.m. (1200 GMT), the Canadian currency was at C$1.2330 to the U.S. dollar, or 81.10 U.S. cents, slightly lower than C$1.2318 to the U.S. dollar, or 81.18 U.S. cents, at Tuesday's close.

The Canadian dollar will likely draw its directional cues from equity and commodity markets for the rest of the week as the domestic economic data cupboard is bare.   Continued...