USDCAD Technical Analysis 2016, 11.09 - 18.09: possible bullish reversal on ranging way

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Sergey Golubev, 2016.09.10 09:49

Weekly Outlook: 2016, September 11 - September 18 (based on the article)

The US dollar had a rough back-to-school week, but it made a comeback later on. Inflation data in the UK and the US, GDP data in New Zealand; rate decisions in the UK and employment data in the UK and Australia stand out. These are the top events on FX calendar.

1. UK Inflation data: Tuesday, 8:30. Economists expect CPI to rise further to 0.7% this time.
2. German ZEW Economic Sentiment: Tuesday, 9:00. Economic sentiment is expected to rise again to 2.8% in September.
3. UK Employment data: Wednesday, 8:30. The number of unemployed is expected to increase by 1,700 in August.
4. US Crude Oil Inventories: Wednesday, 14:30.
   
5. NZ GDP: Wednesday, 22:45. GDP growth in the second quarter is estimated at 1.1%.
6. Australian employment data: Thursday, 1:30. Analysts expect a job gain of 15,200 jobs in August, while the unemployment rate is expected to remain at 5.7%.
7. UK rate decision: Thursday, 11:00. The bank is confident this move will reduce unemployment and improve the economic growth in the UK.
8. US Retail Sales: Thursday, 12:30. Retail sales are expected to decline by 0.1% in August, while the core sales are expected to rise by 0.3%.
9. US PPI: Thursday, 12:30.
   
10. US Philly Fed Manufacturing Index: Thursday, 12:30. Philly Manufacturing activity index is expected to reach 1.1 in September.
11. US Unemployment claims: Thursday, 12:30. The number of new claims is expected to reach 262,000 this week.
12. US Inflation data: Friday, 12:30. CPI is expected to rise by 0.1% in August, while core CPI is estimated to gain 0.2%.
13. US UoM Consumer Sentiment: Friday, 14:00. Consumer sentiment is expected to improve slightly to 91 in August.

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Sergey Golubev, 2016.09.10 15:10

Fed Members Set to Speak Monday. Will Their Comments Move the Markets? (based on forbes article)

• "Three Federal Reserve speakers are taking to a dais ahead of the Fed’s blackout period before its next interest-rate decision meeting Sept. 20-21. Given the market reaction to Friday’s Fedspeak, particularly from Boston Fed President Eric Rosengren who turned his typically dovish comments hawkish ahead of the open, it looks to be a big question. His remarks helped pull the markets down like a magnet that, at midday, didn’t appear to be loosening its grip. Even Fed Gov. Daniel Tarullo’s more dovish comments after the open in a CNBC interview didn’t appear to lighten Rosengren’s impact."
• "What appears to be raising the eyebrows of some Fed watchers is the last-minute press release announcing that long-time dove, Fed board member Lael Brainerd, will speak Monday at the Chicago Council on Global Affairs. Monday, which will also feature talks from Atlanta Bank President Dennis Lockhart and Minneapolis President Neel Kashkari, is the last day of any Fedspeak ahead of its Sept. 20-21 meeting, which will be a do-it-or-don’t day for a step up in interest rates."
• "The talk on Wall Street is that the Fed may be putting her out there to send a message that may or may not clear up the uncertainty that has dogged the markets in recent sessions. Here’s what some analysts, on both sides are saying, according to Barron’s: “As a dovish member, Brainard would carry a lot of credibility delivering a more hawkish message,” commented Peter Hooper, chief economist at Deutsche Bank Securities. Or, this: “There’s a view that she may be going out to express some comfort with the idea of one rate hike this year,” says Gene Tannuzzo, portfolio manager at Columbia Threadneedle Investments. If either of these statements pan out, the next question is when? September or December?"

The the way, the daily price is appeared to be on ranging above 100-day SMA/200-day SMA levels waiting for the direction of the trend:

if the price breaks 1.1326 resistance together with ascending triangle pattern to above so the primary bullish trend will be resumed with 1.1367 target;
if the price breaks 1.1123 support level to below so the bearish reversal of the daily price movement will be started.

Most likely scenariod for the coming week is the following: the price will be on ranging within 1.11/1.14 levels waiting for the direction of the trend.

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Sergey Golubev, 2016.09.15 15:01

Intra-Day Fundamentals - EUR/USD, USD/CAD and AUD/USD: U.S. Retail Sales and U.S. Philadelphia Fed Business Outlook Survey

2016-09-15 12:30 GMT | [USD - Retail Sales]

• past data is 0.1%
• forecast data is -0.1%
• actual data is -0.3% according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - Retail Sales] = Change in the total value of sales at the retail level.

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2016-09-15 12:30 GMT | [USD - Philly Fed Manufacturing Index]

• past data is 2.0
• forecast data is 1.1
• actual data is 12.8 according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - Philly Fed Manufacturing Index] = Level of a diffusion index based on surveyed manufacturers in Philadelphia.

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EUR/USD M5: 20 pips price movement by U.S. Retail Sales and Philly Fed Manufacturing Index news events

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USD/CAD M5: 57 pips range price movement by U.S. Retail Sales and Philly Fed Manufacturing Index news events

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AUD/USD M5: 42 pips range price movement by U.S. Retail Sales and Philly Fed Manufacturing Index news events

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Sergey Golubev, 2016.09.16 14:42

USD/CAD Intra-Day Fundamentals: Canada's Monthly Survey of Manufacturing and 30 pips price movement

2016-09-16 12:30 GMT | [CAD - Manufacturing Sales]

• past data is 0.8%
• forecast data is 0.6%
• actual data is 0.1% according to the latest press release

if actual > forecast (or previous one) = good for currency (for CAD in our case)

[CAD - Manufacturing Sales] = Change in the total value of sales made by manufacturers.

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USD/CAD M5: 30 pips price movement by Canada's Monthly Survey of Manufacturing news event

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Sergey Golubev, 2016.09.17 10:38

Weekly Outlook: 2016, September 18 - September 25 (based on the article)

The US dollar had a positive week, resisting unconvincing data. Now comes the biggest test: the Fed decision. In addition, we have US Building Permits, rate decisions in Japan and in New Zealand, as well as other events. These are the main events for this week.

1. US Building Permits: Tuesday, 12:30. The number of new residential permits is expected to rise to 1.17 million in August.
2. Stephen Poloz speaks: Tuesday, 17:45. BOC Governor Stephen Poloz will speak in Quebec.
3. Japan rate decision: Wednesday.
4. US Crude Oil Inventories: Wednesday, 14:30.
5. US Fed Decision: Wednesday: statement and projections at 18:00, Yellen’s press conference at 18:30. 
6. NZ rate decision: Wednesday, 21:00. Governor Graeme announced new lending restrictions for property investors to cool the housing market and enable further rate cuts in the coming months.
7. US Unemployment Claims: Thursday, 12:30. Economists expect the number of claims will reach 261,000 this week.

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Sergey Golubev, 2016.09.17 11:59

Fundamental Weekly Forecasts for Dollar Index, GBP/USD, AUD/USD, NZD/USD, USD/CAD, USD/CNH and GOLD (based on the article)

Dollar Index - "In the event of full-scale risk aversion, the Dollar will not immediately jump to its haven status. Rather, the first phase of sentiment souring would be a diminished economic outlook and the subsequent loss of further yield potential. The more rapidly confidence falls apart, the better for USD as it will revive the absolute safe haven role. Sentiment however does not just hang on the Fed alone. We have seen volatility and volume rise through other contributions this past week. The BoJ’s quickly failing credibility along with the all-out doves could spark fears for the end of a stimulus-supported market boom. Brexit fears stirred this past week could infect deeper financial flaws. Or, the ‘animal spirits’ themselves could rise. Watch sentiment and the Fed through these tenuous times."

GBP/USD - "In turn, GBP/USD may continue to shed the advance from the August low (1.2854), with the exchange rate failing to preserve the monthly opening range, and the pair may ultimately threaten the post ‘Brexit’ wedge/triangle formation in the days ahead should the FOMC meeting boost interest-rate expectations. However, the pair may continue to consolidate within the near-term holding pattern if Fed officials largely endorse a wait-and-see approach for monetary policy and show a greater willingness to further delay the normalization cycle."

AUD/USD - "Although Fed officials have claimed that every policy meeting may produce a rate hike, their clear desire not to trigger market panic suggests that they will not opt to change things without an opportunity to thoroughly explain in detail. This means that after this week’s outing, the next opportunity for stimulus withdrawal comes in December. Between now and then, another opportunity to update traders will come in November, offering the FOMC a chance to up- or down-shift the projected rate hike path and limit surprise risk. Keeping this flexibility will mean that the narrative emerging from the upcoming announcement will need to be cautious but unmistakably hawkish. This bodes ill for risk appetite as well as the Aussie’s yield advantage, threatening to deliver the currency a third consecutive weekly loss."

NZD/USD - "We’re going to hold a neutral forecast on the New Zealand Dollar for the week ahead, with a warning of caution around this upcoming RBNZ meeting as the bank will be making the announcement in what could be extremely volatile market conditions in the wake of FOMC."

USD/CAD - "The heavy economic data points this week will take place on Friday, which will be after the dust settles from the international development such as the Central Bank triple-header on September 21. On Tuesday, Bank of Canada Governor Stephen Poloz will be speaking in Quebec City, which will be followed by a press conference. Friday will provide the Canadian Dollar an opportunity to reverse its trend of negative economic surprises with Retail Sales (exp. -0.1 MoM), and the Consumer Price Index (exp. 1.3% YoY.) Because this is the key gauge for inflation in Canada, a disappointment here coupled with positive developments south of the Canadian Border could put further selling pressure on the Loonie."

USD/CNH - "Next week, traders will want to watch two indicators for clues of the lower bound of the USD/CNH: A) The PBOC’s guidance – the last Yuan fix issued by the PBOC before the holiday was 6.6726. The USD/CNH has already traded below this level. Yuan’s reference rate set after the reopen of onshore markets could tell us whether the Central Bank confirms this Yuan strength. B) HIBOR rates: tightened Yuan liquidity will increase the cost of shorting the Yuan and thus could hold the USD/CNH at low levels. The average level of HIBOR O/N in August was 1.41% and the average over the past 12 months was 2.56%. If the HIBOR read on next Monday is still significantly higher than these levels, it may indicate uneased condition in offshore and a stronger Yuan."

GOLD (XAU/USD) - "Gold is eyeing a key near-term support confluence into the close of the week at 1302/04 where the 100% extension of the decline off the early high converges on the 100-day moving average, the monthly low & the May high. The immediate downside bias is at risk while above this level near-term with initial resistance eyed at the monthly low-day close at 1323 backed by 1330."