- Housing Starts: Monday, 12:15. Housing starts is an important gauge of the strength of the housing sector. The indicator slipped to 171 thousand in April, its lowest level since January 2016. Will we see a rebound in the May release?
- Corporate Profits: Tuesday, 12:30. Canadian corporations enjoyed a strong increase of 3.6% in profits during Q4 of 2019, marking a third consecutive quarterly expansion. We now await the Q1 data.
- Capacity Utilization Rate: Friday, 12:30. This quarterly measure of the industry provides the Bank of Canada with insights on the level of slack in the economy. Utilization has been fluctuating slightly above the 80- level in recent releases.
USD/CAD Technical Analysis
Technical lines from top to bottom:
With USD/CAD recording sharp losses, we start at lower levels:
1.3757 switched to resistance early in the week.
1.3661 (mentioned last week) is next.
1.3550 had been in a support role since early March, but switched to resistance after strong gains by USD/CAD last week.
1.3420 is fluid, as USD/CAD ended the week just shy of this level.
1.3330 is providing support.
1.3265 is next.
1.3150 is the final support level for now.
I am neutral on USD/CAD
The outlook for the Canadian economy is not rosy, but the Canadian dollar has showed surprising resilience, with gains of 4.5% since April 1. Last week’s employment numbers were strong on both sides of the border, a sign that both the U.S. and Canada are seeing stronger economic conditions.
- EUR/USD forecast – for everything related to the euro.
- GBP/USD forecast – Pound/dollar projections.
- AUD/USD forecast – analysis for the Aussie dollar.
- USD/JPY forecast – analysis for dollar/yen
- Forex+ weekly forecast – Outlook for the major events of the week.