USD/CAD daily chart with support and resistance lines on it. Click to enlarge:
- Ivey PMI: Wednesday, 14:00. The index disappointed in June, dropping to 52.4. This missed the estimate of 52.4 and marked a 4-month low. The July estimate is 52.7.
- NHPI: Thursday, 12:30. The New Home Price Index continues to hover around the zero level, and has failed to post a gain in close to a year. The index declined by 0.1% in May, falling short of the forecast of 0.2%. The markets are expecting a small gain of 0.1% in June.
- Housing Starts: Friday, 12:15. There was positive news in June, as the indicator jumped to 246 thousand, crushing the estimate of 209 thousand. This was the highest monthly gain since November 2017.
- Employment Data: Friday, 12:30. Employment change is a key event which should be treated as a market-mover. In June, the indicator dropped by 2.2 thousand, well short of the estimate of +10.0 thousand. Will we see a rebound in July? The unemployment rate ticked higher in June to 5.5%, up from 5.4% a month earlier. This matched the forecast.
* All times are GMT
USD/CAD Technical Analysis
Technical lines from top to bottom:
We start with resistance at 1.3565.
1.3445 has held in resistance since the first week of June.
This is followed by 1.3385.
1.3350 has held in resistance since mid-June. Next is 1.3265.
1.3175 was breached late in the week for the first time since the last week in June.
1.3125 (mentioned last week) has switched to a support role after USD/CAD posted strong gains last week.
1.3048 has some breathing room in support. 1.2916 is next.
1.2831 has held in support since early October.
1.2729 is the final support level for now.
I am bearish on USD/CAD
The Federal Reserve pulled the rate trigger, but the U.S. economy is performing well and sentiment towards the greenback remains strong. U.S. President Trump imposed new tariffs on China last week, which could dampen risk appetite and hurt the Canadian dollar.
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