USDCAD news - page 18
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USD/CAD climbs after U.S., Canadian data
he U.S. dollar climbed against its Canadian counterpart on Tuesday, after mixed economic reports from the U.S., as downbeat Canadian housing starts data weighed on the local currency.
USD/CAD hit 1.3102 during early U.S. trade, the session high; the pair subsequently consolidated at 1.3095, advancing 0.73%.
The pair was likely to find support at 1.2989, Monday's low and resistance at 1.3181, Monday's high.
The U.S. Bureau of Labor Statistics reported on Tuesday that unit labor costs increased by0.5% in the three months to June, above forecasts for a gain of 0.1% and following rise of 2.3% in the first quarter.
The report also said that nonfarm business sector labor productivity increased by 1.3% in the second quarter, missing expectations for a gain of 1.6%. The previous quarter’s figure was revised to a drop of 1.1% from a previously reported fall of 3.1%.
The dollar has strengthened earlier in the day, after China devalued the yuan in an attempt to help exporters after a recent spate of disappointing economic data.
The central bank described it as a “one-off depreciation” of nearly 2%, based on a new way of managing the exchange rate that better reflected market forces.
In Canada, data showed that housing starts rose by 193,000 last month, below expectations for an increase of 195,000. Housing starts rose by 202,300 in June, whose figure was downwardly revised from a previously estimated 202,800 gain.
The commodity-linked Canadian dollar also continued to suffer from the continuing drop in oil prices. Crude oil futures for September delivery were down 3.34% at $43.45 as U.S. trading opened.
The loonie was sharply lower against the euro, with EUR/CAD rallying 1.09% to 1.4489.
The single currency found support after a Greek official said early Tuesday that his government had completed talks with creditors over a deal setting out the terms of a third bailout, with some details remaining.
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WHy CitiFX likes USD/CAD longs
Citi highlights further drop in Canadian oilAnalysts at Citi initiated a long USD/CAD trade yesterday at 1.3024 (spot now at 1.3045) with a stop at 1.2984 and a target of 1.3199.
They note that Canadian crude prices -- Western Canada Select -- is trading at a $19 discount to WTI.
"The product that Albertans were selling for $80/$90 per barrel last year is now selling for $22.41. Ouch," they write. Noting this has set off more talk of QE in Canada's future and rate cuts may be in the cards.
"With EM blowing up and equities selling off, EURCAD longs look good too as the euro benefits from flight to safety / risk off / DAX hedge unwind flows. Don't forget that EUR is the new JPY," they write.
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USD/CAD forecast for the week of August 17, 2015
The USD/CAD pair fell during the course of the week, but as you can see found enough support near the 1.30 level to turn things back around and form a hammer. This of course is a very bullish sign and quite frankly this is one of her favorite currency pairs at the moment. We’ve had a decent breakout to the upside, and have now tested for support a couple of times. The hammer is the second time that we’ve seen this form in the last 3 weeks, so we believe that the market is ready to take off to the upside for the longer term. We believe that a break above the top of the hammer is of course a very positive sign, and the market should then head towards the 1.35 level given enough time. That’s not to say that is going to go there right away, but we believe that every time this market pulls back there will be interested parties in going long.
The crude oil markets certainly don’t help the Canadian dollar at this point in time now, so having said that we believe that the US dollar should continue to strengthen against the Canadian dollar as we have quite a bit of bearish pressure on the oil markets themselves. On top of that, the US dollar continues to strengthen in general as the world’s market are concerned about various issues. After all, the US economy is growing, but so many others are barely squeaking along. With that, we feel that this is a bit of a “perfect storm”, and we do not expect some type of massive melt up in the process.
We believe that support runs all the way down to the 1.28 handle, and as a result we have no interest in selling until we break well below that level on a significant move. In the meantime, we look at every dip as value in the greenback, and continue to purchase it time and time again as commodity markets simply do not warrant anything else.
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USD/CAD Forecast Aug. 17-21
The Canadian dollar posted modest gains this week, as USD/CAD closed at 1.3085. This week’s key events are Core CPI and Core Retail Sales. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD.
The Fed continues to remain mum about a rate hike, so he guessing game on the part of the markets continues. Retail Sales were strong, but employment and consumer confidence numbers were slightly lower than expected. In Canada, Manufacturing Sales posted a lower gain than anticipated, and this pulled the loonie lower late in the week.
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USD/CAD: Bulls Can't Get Enough, Pair Nears C$1.32
The latest dip below the C$1.30 mark was quickly bought and the pair accelerated higher, boosted by the ongoing commodity rout. It was seen changing hands around C$1.3140 during the London session on Monday, slowly pushing towards the C$1.32 barrier.
Investors will be closely watching macroeconomic news throughout out the week, mainly CPI data, which are due from both countries. Moreover, the US will release the Federal Open Market Committee (FOMC) minutes and housing data, while Canada will publish retail sales figures on Friday.
The annual central bankers meeting in Jackson Hole begins this week and might offer some insights into the individual monetary policies as central bankers tend to comment during this event.
"The global economy spins its wheels, while central banks all over push ever harder on the monetary accelerator, to little effect. Compound that concern with the fact that the world’s biggest central bank, the Federal Reserve may be tempted to do the monetary equivalent of tapping the brake pedal next month, and it’s not hard to see why investors are a touch nervous, particularly given that inflation remains fairly benign," Michael Hewson, chief market analyst at CMC Markets UK, said on Monday.
The loonie is suffering from the plummeting oil price, as both the main oil benchmarks have been under selling pressure since July.
"US crude was down 1.2% at $41.99 a barrel, within reach of a six-year trough of $41.35 struck on Friday. Brent futures were down 54 cents at $48.65 a barrel, still some way from their 2015-low of $45.19," David Papier, sales trading team leader at ETX Capital, wrote in a research note.
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Forex technical analysis: USDCAD moves higher on big surprise build in EIA inventorie
Moves away from 100 and 200 hour MAsThe USDCAD has pushed higher on the unexpected surprises in the weekly EIA inventories data., The push has the pair trading above a trend line. The high yesterday came in at 1.31255. The high from Monday extended to 1.3151 - just below the high from August 12 at 1.3156. Those are the next targets.
With the 100 and 200 hour MA converged and the price testing that level today (Threes a Crowd), I expect traders to take the bullish clue and move further away from those MAs. Look for buyers on dips with stops on a disappointment below the two moving averages now....
Canada June wholesale trade sales +1.3% vs +0.9% expected
Wholesale sales data from Canada:
It's a lower tier indicator but a slight glimmer of good news in an otherwise bleak Canadian economic landscape.
Canada July CPI 1.3% y/y vs 1.3% y/y expected
Canadian July CPI:
Everything was bang-on expectations.
USD/CAD forecast for the week of August 24, 2015
The USD/CAD pair went back and forth during the week, and started to test the 1.30 level. This of course is a large, round, psychologically significant level, and will attract a lot of attention. This pair is highly sensitive to the price of oil, and with the selling pressure seen in those markets, it makes sense we go higher. We believe that the 1.32 barrier will be broken, as the longer-term strength should continue to make itself known again and again as the commodity markets remain very soft, with oil being no different.
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USD/CAD Forecast Aug. 24-28
The Canadian dollar lost close to a 100 points last week, as USD/CAD jumped late in the week and closed at 1.3186. There are just three events this week. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD.
The Fed minutes brought more uncertainty to the timing of a rate hike, as the Fed is clearly hesitant about raising rates in September. US employment numbers were steady and housing numbers beat expectations. Canadian retail sales numbers were stronger than expected but the loonie still swooned late in the week.
* All times are GMT.