Forecast and levels for CAD - page 3

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Sergey Golubev, 2017.07.11 15:05

USD/CAD Intra-Day Fundamentals: CMHC Housing Starts and range price movement 

2017-07-11 13:15 GMT | [CAD - Housing Starts]

  • past data is 195K
  • forecast data is 200K
  • actual data is 213K according to the latest press release

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

[CAD - Housing Starts] = Annualized number of new residential buildings that began construction during the previous month. 

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From official report :

  • "The trend in housing starts was 215,459 units in June 2017, compared to 214,570 units in May 2017, according to Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts."
  • "The standalone monthly SAAR of housing starts for all areas in Canada was 212,695 units in June, up from 194,955 units in May. The SAAR of urban starts increased by 9.6 per cent in June to 194,773 units. Multiple urban starts increased by 9.4 per cent to 127,944 units in June and single-detached urban starts increased by 10.1 per cent, to 66,829 units."

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USD/CAD M5: range price movement by Canada Mortgage and Housing Corporation news event 



 

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Sergey Golubev, 2017.07.12 16:12

USD/CAD Intra-Day Fundamentals: Bank of Canada Overnight Rate and range price movement 

2017-07-12 15:00 GMT | [CAD - Overnight Rate]

  • past data is 0.50%
  • forecast data is 0.75%
  • actual data is 0.75% according to the latest press release

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

[CAD - Overnight Rate] = Interest rate at which major financial institutions borrow and lend overnight funds between themselves. 

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From official report :

  • "The Bank of Canada is raising its target for the overnight rate to 3/4 per cent. The Bank Rate is correspondingly 1 per cent and the deposit rate is 1/2 per cent. Recent data have bolstered the Bank’s confidence in its outlook for above-potential growth and the absorption of excess capacity in the economy. The Bank acknowledges recent softness in inflation but judges this to be temporary. Recognizing the lag between monetary policy actions and future inflation, Governing Council considers it appropriate to raise its overnight rate target at this time."
  • "Governing Council judges that the current outlook warrants today’s withdrawal of some of the monetary policy stimulus in the economy. Future adjustments to the target for the overnight rate will be guided by incoming data as they inform the Bank’s inflation outlook, keeping in mind continued uncertainty and financial system vulnerabilities."
  • "The next scheduled date for announcing the overnight rate target is September 6, 2017. The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR on October 25, 2017."

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USD/CAD M5: range price movement by BOC Overnight Rate news event 


 

Related to Bank of Canada Overnight Rate news event today ...
If we look on the price at H4 price so we may see the price to be bounced from 1.2945 resistance level to below.

This 1.2945 level is the bullish reversal level located near 'reversal' Senkou Span line of Ichimoku indicator. It means the following: if the price breaks 1.2045 resistance to above so the bullish reversal will be started.


So, the price was bounced from this level to below, and it makes intra-day bullish reversal to be very unlikely in the near future for example.

 

What does it mean for the daily price?

The bearish breakdown is going to be continuing with 1.2646 nearest target to re-enter.


 

What  Bank of Canada Overnight Rate news event means in global way for long-term movement?


It means the following: The price is breaking 1.2945 support level to below on weekly open bar. If the weekly price is closed below this level so the long-term correction will be started and may be continuing up the end of this year.

 

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Sergey Golubev, 2017.07.16 10:19

Weekly Fundamental Forecast for USD/CAD (based on the article)


USD/CAD - "With the Canadian economy now projected to grow an annualized 2.8% in 2017, the BoC may layout a more detailed exit strategy the as ‘output gap is now projected to close around the end of 2017, earlier than the Bank anticipated in its April Monetary Policy Report (MPR).’ The material shift in central bank rhetoric suggests Governor Poloz and Co. may even consider a series of rate-hikes especially as ‘the factors behind soft inflation appear to be mostly temporary.’"


 

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Sergey Golubev, 2017.07.21 13:32

Trading the News: Canada Consumer Price Index (CPI) (based on dailyfx article)

Signs of softer-than-expected inflation may push the BoC to the sidelines as ‘very strong growth of the first quarter is expected to moderate over the balance of the year,’ and Governor Stephen Poloz and Co. may endorse a wait-and-see approach at the next meeting on September 6 as ‘geopolitical uncertainty still clouds the global outlook.’
Nevertheless, stickiness in the core rate of inflation accompanied by a further expansion in household consumption may encourage the BoC to adopt a more hawkish tone as ‘the output gap is now projected to close around the end of 2017, earlier than the Bank anticipated in its April Monetary Policy Report (MPR).’ In turn, BoC officials may continue to implement higher borrowing-costs over the coming months as the central bank expect to achieve the 2% target for price growth by the middle of 2018.

What’s Expected:


Why Is This Event Important:

Canada’s Consumer Price Index (CPI) slipped to an annualized 1.3% in May from 1.6% the month prior, while the core rate of inflation held steady at 1.3% per annum amid forecasts for a 1.4% print. A deeper look at the report showed the decline was largely led by lower energy prices, with transportation costs narrowing 0.7% in May, while prices for clothing and footwear bounced back 0.5% after contracting 1.1% in April. The Canadian dollar lost ground following the softer-than-expected inflation report, with USD/CAD turning around ahead of the 1.3200 handle to end the day at 1.3268.

How To Trade This Event Risk

Bearish CAD Trade: Canada Inflation Report Continues to Disappoint

  • Need a green, five-minute candle following the report to consider a long USD/CAD position.
  • If market reaction favors a bearish loonie trade, buy USD/CAD with two separate lots.
  • Set stop at the near-by swing low/reasonable distance from entry; look for at least 1:1 risk-to-reward.
  • Move stop to breakeven on remaining position once initial target is met, set reasonable limit.

Bullish CAD Trade: Headline & Core CPI Exceed Market Expectations

  • Need a red, five-minute USD/CAD candle to consider a long loonie position.
  • Implement the same setup as the bearish loonie trade, just in reverse.

USD/CAD Daily


USD/CAD M5: range price movement by Canada Consumer Price Index news event -


 

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Sergey Golubev, 2017.07.22 12:07

Weekly Fundamental Forecast for USD/CAD (based on the article)


USD/CAD - "The headline inflation rate fell to 1.0% year/year in June from 1.3% in May – dropping further away from the BoC’s 2% target – but two of Canada’s three measures of core inflation were higher and May retail sales jumped by 0.6% month/month rather than the 0.3% expected by analysts. This helped reinforce the Canadian currency’s bullish momentum and inevitably brought the 1.25 level into focus for USDCAD, even though the pair is now technically oversold."


 

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Sergey Golubev, 2017.07.28 08:32

USD/CAD - daily bearish; 1.2413 is the key (based on the article)

Daily price is located very far from Ichimoku cloud in the bearish area of the chart: price is breaking descending triangle pattern to below together with 1.2413 support level for the bearish trend to be continuing.


  • "The 1.24 hand showed two wave relationships showing up the area. First, the 61.8% extension of the January 2016 to May 2016 down trend projected to 1.2399. Secondly, within the current down trend that began May 2017, there is a 2.618 extension near 1.2475. With two different wave projecting wave relationships near the same level, a reaction higher is likely."
  • "The depth and shape of the bounce will alert us if the downtrend is over or if it is merely taking a breather. It would be considered normal for the bounce higher to work back towards the 1.28 handle. If the bounce higher proceeded as a slow grind of overlapping waves, then that would suggest the upward push is corrective and further downside may prevail in the longer term."



 

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Sergey Golubev, 2017.08.05 11:13

Weekly USD/CAD Outlook: 2017, August 06 - August 13 (based on the article)

Dollar/CAD moved up, correction previous losses as oil prices cooled down. The upcoming week features housing figures from Canada. 


  1. Housing Starts: Tuesday, 12:15. The Canadian housing sector has been rocked by reports of house price falls in Toronto. A small slide to 206K is on the cards now.
  2. Building Permits: Wednesday, 12:30. A drop of 1.8% is forecast now.
  3. NHPI: Thursday, 12:30. The third housing indicator of the week relates to prices of new homes. A slightly more modest rise of 0.5% is projected.

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