Looking for the latest outlook for this week? Check the full section: USD/CAD Forecast.
The Canadian dollar reversed last week’s gains, with USD/CAD rising high. Here’s an outlook for this week’s events in Canada, and an updated technical analysis for USD/CAD.
USD/CAD graph with support and resistance lines marked on it. Click to enlarge:
After more than a few disappointing indicators, CPI didn’t disappoint, but didn’t provide the loonie with the necessary boost to fight the recent greenback’s strength. Mark Carney will not raise the rates earlier than expected. This week’s main event is retail sales, and there are more. A technical analysis will follow:
- Retail Sales: Canadian retail sales have been going up and down in recent months. Consumers in Canada aren’t too sure what to do. This time, the 0.8% rise is predicted to be followed by another rise, of 0.4% this time. Core Retail Sales have the exact same behavior, and this number is no less important. Core retail sales are expected to rise by 0.4% after a 0.5% last time. Published on Monday at 13:30 GMT.
- Corporate Profits: While this might seem more related to the stock markets, this figure has an impact on the Canadian dollar as well. This is a quarterly figure, that has fallen in the last 3 quarters – showing a squeeze in profits. Corporate profits are predicted to follow the 6.4% fall in profits with another drop this time, completing a year of decline. Published on Wednesday at 13:30 GMT.
- Current Account: Trade balance is a significant part of the current account, and it has already been published, showing a small deficit. Despite the good goods balance, services and cash flow aren’t too good. The deficit has grown to 11.2 billion last month, worrying policy makers. It’s predicted to slightly squeeze this time. Published on Friday at 13:30 GMT.
USD/CAD Technical Analysis
USD/CAD began the week by going down and bouncing off the 1.04 level mentioned in last week’s USD/CAD outlook. Since then, it has been going up steadily, rising above the 1.06 line and closing at 1.07.
1.06 now serves as the first support line, after being broken. It has been previously broken to the downside not so long ago. Below, the aforementioned 1.04 is the next support line, followed by the year-to-date low of 1.02 and then parity.
Looking up, 1.0850 is the first resistance line, being a peak in the near past. Above that, 1.1130 is a strong resistance line, that was tested twice in August.
I continue to stay neutral on USD/CAD, as I did throughout November.
- For a broad view of all the week’s major event in all currencies, read the forex weekly outlook.
- For the Euro, read the EUR USD Forecast.
- For GBP/USD, look into the British Pound forecast.
- For the Australian dollar, read the AUD/USD forecast.
- For USD/CAD, check out the Canadian dollar forecast.
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