USD/CAD posted losses last week, its first losing week in a month. There are four Canadian economic releases in the upcoming week. Here is an outlook for the highlights and an updated technical analysis for USD/CAD.
Canada’s Ivey PMI sparkled in March, rising from 60.0 to 72.9 and blowing past the forecast of 62.0. This points to strong growth. Job creation soared in March, with gains of 303.1 thousand, crushing the estimate of 101.5 thousand. The unemployment rate fell to 7.5%, down from 8.2% beforehand.
In the US, JOLTS Job Openings rose to 7.37 million, up from 6.92 million and well above the forecast of 6.91 million. However, unemployment claims climbed unexpectedly, from 719 thousand to 744 thousand, well above the estimate of 682 thousand.
The Federal minutes indicated that the central bank remains concerned about the strength of the US economy and will continue its QE program in order to support economic growth.
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USD/CAD daily graph with resistance and support lines on it. Click to enlarge:
- BOC Business Outlook Survey: Monday, 14:30. This well-respected survey looks at a wide range of business conditions, including spending and hiring expectations. It should be treated as a market-mover.
- ADP Non-Farm Employment Change: Thursday, 12:30. This report has been showing sharp job losses and came in at -100.8 thousand in February. Will we see an improvement in March?
- Housing Starts: Friday, 12:15. Housing starts slipped to 246 thousand in February, down from 282 thousand. Analysts expect a rebound in March, with a forecast of 254 thousand.
- Wholesale Sales: Friday, 12:30. Wholesale Sales jumped 4.0% in January, its best month since July. A downturn is expected in February, with an estimate of -0.5%.
Technical lines from top to bottom:
We start with resistance at 1.2869.
1.2759 is next.
1.2640 was tested at the end of March.
1.2510 (mentioned last week) is an immediate support line.
1.2398 has held since mid-March.
1.2288 is an important monthly support level. It is the final line for now.
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The Canadian economy is finding its footing, and employment numbers continue to impress. The US economy is also heating up, which should raise risk sentiment and boost minor currencies such as the Canadian dollar.
Further reading:
- EUR/USD forecast – for everything related to the euro.
- GBP/USD forecast – Pound/dollar projections.
- AUD/USD forecast – analysis for the Aussie dollar.
- USD/CAD forecast – Canadian dollar predictions.
- Forex+ weekly forecast – Outlook for the major events of the week.
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