Category: Canadian Dollar Forecast

USD/CAD Forecast Dec. 15-19



The Canadian dollar resumed its losing ways, dropping over 100 points last week. USD/CAD closed the week at 1.1580, its lowest level since July 2009. This week’s highlights are Manufacturing Sales, Core CPI and Core Retail SalesHere is an outlook on the major market-movers and an updated technical analysis for USD/CAD.

The US dollar pushed higher against the loonie, responding to the upbeat retail sales number and the excellent consumer confidence report. In Canada, Building Permits dropped to 0.7%, short of expectations. Despite some mixed figures from Canada, the loonie declined together with the falling prices of oil. The convincing break above 1.15 puts USD/CAD at new levels last seen at 2009.

Updates:

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

USDCADForecast Dec.15-19

  1. Manufacturing Sales: Tuesday, 13:30. Manufacturing Sales bounced back in September with a strong gain of 2.1%, easily beating the forecast of 1.3%. The markets are bracing for a decline in October, with the estimate standing at -0.4%.
  2. Foreign Securities Purchases: Tuesday, 13:30. The indicator dropped to C$ 4.37 billion in September, well off the estimate of C$ 11.32 billion. A slight improvement is expected in the upcoming release, with a forecast of $5,21 billion.
  3. Wholesale Sales: Wednesday, 13:30. Wholesale  Sales is a key event and an important gauge of consumer sales. The indicator was unexpectedly strong in September, with an estimate of 1.8%, well above the forecast of 0.7%. This marked the strongest showing in 4 months. The estimate for November stands at 0.9%.
  4. Core CPI: Friday, 13:30. Core  CPI is a key gauge of consumer inflation, which has been at low levels for most of the second half of 2014. The index met expectations last month with a gain of 0.3%, and the forecast for the upcoming release stands at 0.1%.
  5. Core Retail Sales: Friday, 13:30.  Core Retail Sales has not been in positive territory since June, pointing to sluggish consumer spending. The indicator came in at a flat 0.0% last month and is expected to improve to 0.2% in the upcoming release.
  6. CPI: Friday, 13:30. CPI is the primary gauge of consumer inflation. The indicator posted a weak gain of 0.1% in October, its strongest gain since May. The markets are expecting a decline in November, with an estimate of -0.2%.
  7. Retail Sales: Friday, 13:30. Retail Sales includes volatile items such as automobile sales which are excluded from Core Retail Sales. The indicator jumped to 0.8% in October after two declines. However, the indicator is expected to slip to -0.4% in the upcoming release.

* All times are GMT.

USD/CAD Technical Analysis

USD/CAD opened the week at 1.1445and quickly touched a low of 1.1397, as support at 1.1333 held firm (discussed last week). The pair then reversed directions and climbed to a high of 1.1591. USD/CAD closed the week at 1.1580.

Live chart of USD/CAD:


Technical lines, from top to bottom:

We start at higher levels, as the pair trades at higher levels.

119.75 is the final barrier prior to the psychologically important level of 1.20. This line has held firm since November 2005.

118.72 was a key resistance line in February 2007. It has remained intact since then.

1.1752 marked the start of a rally by the Canadian dollar in February 2007, which saw USD/CAD drop below parity. 1.1640 is next.

1.1487 has switched to a support role following the pair’s strong gains last week. This line has remained intact since July 2009.

1.1340 is providing strong support. 1.1271 is  next.

1.1122 marks the low point of a US dollar rally which started late in October and saw USD/CAD climb above 1.14 earlier in November.

1.1053 is the final support level for now. It is providing support above the psychologically important line of 1.10.

I remain bullish on USD/CAD

The pair continues to trade at multi-year highs and we could see the trend continue. The markets are expecting weak Canadian inflation and consumer spending releases, so the loonie is ripe for new lows.

In our latest podcast we talk about US jobs, the ECB’s dilemma, a run down of slippery oil and an interesting interview with Itai Furman.

[audio mp3="http://www.podtrac.com/pts/redirect.mp3/www.forexcrunch.com/wp-content/uploads/2014/12/Market-Movers-December-11.mp3"][/audio]

Download it directly here.

Further reading:

USD/CAD Forecast Dec. 8-12

USD/CAD Forecast Dec. 8-12

The Canadian dollar showed strong gains early in the week but was unable to consolidate and ended the week almost unchanged. USD/CAD closed the week at 1.1423. This week’s highlight is Building Permits. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. In the US, Non-Farm Payrolls report was outstanding with a 321K job gain

USD/CAD Forecast Dec. 1-5

USD/CAD Forecast Dec. 1-5

The Canadian dollar suffered sharp losses last week, slipping about 170 points alongside the crash in oil prices and despite good data at home. USD/CAD climbed above the 1.14 line for the first time since July 2009 and closed at 1.1402. The upcoming week is  a busy one, with five key events. Here is an outlook on the major market-movers and

USD/CAD Forecast Nov. 24-28

USD/CAD Forecast Nov. 24-28

The Canadian dollar showed some movement in both directions but was little changed at week’s end. USD/CAD posted slight losses, closing the week at 1.1231. This week’s highlights are Retail Sales and GDP. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. Canadian Wholesale Sales impressed with a sharp gain in September.

USD/CAD Forecast Nov. 17-21

USD/CAD Forecast Nov. 17-21

The Canadian dollar posted modest gains last week, as USD/CAD closed the week at 1.1286. This week’s highlights are Wholesale Sales and Core CPI. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. US employment numbers were not impressive last week, as jobless claims missed expectations and JOLTS softened. Still, there was a silver

USD/CAD Forecast November 10-14

USD/CAD Forecast November 10-14

The Canadian dollar broke above the 1.14 line but recovered and showed little change on the week. USD/CAD closed the week at 1.1326. This week’s key release is Manufacturing Sales. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. US Nonfarm Payrolls slipped to 214 thousand, well short of the estimate of 235

USD/CAD Forecast November 3-7

USD/CAD Forecast November 3-7

The Canadian dollar was almost unchanged last week, with USD/CAD closing at 1.1254. There are a number of key releases, highlighted by Ivey PMI and Employment Change. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. In a symbolic move, the Federal Reserve ended its QE program and issued a hawkish policy statement. GDP looked sharp, pointing

USD/CAD Forecast Oct. 27-31

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,

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