Category: Canadian Dollar Forecast

USD/CAD Forecast Oct. 27-31



The Canadian dollar had showed some strength last week, with USD/CAD closing with modest losses. The pair closed the week at 1.1228. This week’s highlights include GDP and an appearance by BoC head Stephen Poloz before a parliamentary committee. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD.

The Canadian dollar shrugged off a weak consumer spending data, as Core Retail Sales posted a second straight decline. In the US, data was generally positive, with jobless claims and inflation holding on. However, New Homes Sales slumped in September.

Updates:

USD/CAD daily chart with support and resistance lines on it. Click to enlarge:

USDCADForecast Oct27-31

  1. RMPI: Wednesday, 12:30. Raw Materials Price Index measures the change in prices that manufacturers are paying for raw materials. The index has not looked strong, posting three declines in the past four readings. However, a turnaround is expected in the September release, with the estimate standing at 1.5%.
  2. BoC Governor Stephen Poloz Speaks: Wednesday, 20:15. Poloz will testify before the Senate Standing Committee on Banking, Trade, and Commerce in Ottawa. The markets will be listening closely, looking for any hints regarding the BoC’s future interest rate policy.
  3. GDP: Friday, 12:30. GDP is one of the most important economic indicators, and should be treated as a market-mover by traders. Unlike most developed economies, Canada releases GDP on a monthly rather than quarterly basis. In August, GDP dipped to a flat 0.0%, shy of the estimate of 0.2% and its lowest reading since January. No change is expected in the upcoming reading, and if the indicator shows contraction. look for the Canadian dollar to respond with losses.

* All times are GMT.

USD/CAD Technical Analysis

USD/CAD opened the week at 1.1290 and quickly touched a high of 1.1296. The pair then broke below resistance at 1.1271(discussed last week), falling to a low of 1.1184. USD/CAD closed the week at 1.1228.

Live chart of USD/CAD:


Technical lines, from top to bottom:

We begin with resistance at 1.1640 marked the start of a US dollar rally in July 2009, which saw the pair drop close to the 0.94 line.

1.1494 was a key resistance line in November 2006.

1.1373 was breached in October 2008 as the US dollar posted sharp gains, climbing as high as the 1.21 level. This line has remained steady since July 2009.

1.1271 was easily breached as the Canadian dollar showed some strength, with the pair. It has reverted to a support role.

1.1122 continues to provide strong support and has held firm since early in the month.

1.1054 remains a strong support line. 1.0944 is next.

1.0815 has held firm since late August.

1.0737 marked a cap in mid-2010, before the US dollar tumbled and dropped all the way into 0.93 territory. It is the final support line for now.

I remain bullish on USD/CAD

The markets are expecting a strong GDP for Q3 the US, and if the indicator delivers, the US dollar should have a good week. As well, the Fed is likely to wrap up QE, which should put the markets in a positive mood about the US dollar, as the focus shifts to the timing of a rate hike, which is widely expected in 2015.

In our latest podcast, we preview the all important Fed decision, digest China and examine bitcoin against gold:

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Further reading:

USD/CAD Forecast October 20-24

USD/CAD Forecast October 20-24

The Canadian dollar returned to its losing ways last week, as USD/CAD gained about 100 points, closing at 1.1275. This week’s highlights are Core Retail Sales and the Overnight Rate. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. The US dollar shrugged off weakness in US retail sales and a poor PPI

USD/CAD Forecast Oct. 13-17

USD/CAD Forecast Oct. 13-17

The Canadian dollar posted weekly gains for the first time in three weeks, as USD/CAD closed slightly below the 1.12 line. This week’s highlights are Manufacturing Sales and Core CPI. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. Canadian job data was outstanding, as Employment Claims jumped to their highest level in over a

USD/CAD Forecast Oct. 6-10

USD/CAD Forecast Oct. 6-10

The Canadian dollar lost close to a cent last week, as USD/CAD closed above the 1.12 line for the first time since March. This week’s highlights are Building Permits and Employment Change. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. Canada’s trade balance posted a deficit for the first time in three months.

USD/CAD Forecast Sep. 29-Oct. 3

USD/CAD Forecast Sep. 29-Oct. 3

The Canadian dollar dropped sharply last week, surrendering about 200 cents against the US dollar. USD/CAD closed the week at 1.1142, its lowest level since March. This week’s highlight is GDP. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. Canadian Core Retail Sales disappointed, posted its first decline since January. The US economy

USD/CAD Forecast Sep. 22-26

USD/CAD Forecast Sep. 22-26

The Canadian dollar rebounded last week, gaining over 100 cents against the US dollar. USD/CAD closed the week at 1.0962. This week’s highlight is Core Retail Sales. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. US  unemployment claims dropped sharply last week, and the Fed hinted that once rates are raised, subsequent hikes

USD/CAD Forecast Sep. 15-19

USD/CAD Forecast Sep. 15-19

The Canadian dollar had its worst week of 2014, as USD/CAD jumped about 200 points, closing close to the 1.11 level. This week’s major releases are Manufacturing Sales, Core CPI and Wholesale Sales. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. Canadian housing data was a mix last week, as Building Permits shined, while Housing

USD/CAD Forecast Sep. 8-12

USD/CAD Forecast Sep. 8-12

USD/CAD showed some movement in both directions, but ended the week unchanged, closing at 1.0877. This week’s highlight is Building Permits. Here is an outlook on the major events and an updated technical analysis for USD/CAD. Canadian Employment Change and Ivey PMI tumbled in August, but the Canadian dollar managed to hold its own last week. In the US,

USD/CAD Forecast Aug. 25-29

USD/CAD Forecast Aug. 25-29

USD/CAD came close to the 1.10 line, but  then retracted and showed little change over the week. This week’s highlight is GDP. Here is an outlook on the major events and an updated technical analysis for USD/CAD. Canadian inflation remains in the doldrums, as CPI numbers declined in July. On a brighter note, retail sales were excellent. In the US, the economy continues to point

USD/CAD Forecast Aug. 18-22

USD/CAD Forecast Aug. 18-22

The Canadian dollar improved last week, as USD/CAD closed just below the 1.09 level. This week’s highlights are Wholesale Sales, Core CPI and Core Retail Sales. Here is an outlook on the major events and an updated technical analysis for USD/CAD. Canadian Housing Starts and Manufacturing Sales both beat their estimates, and the Canadian dollar took full advantage.