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USD/CAD – Canadian Dollar Flirts With 1.12 on Soft GDP

USD/CAD continues to point upwards on Tuesday. The pair broke above the 1.12 line on Tuesday, after Canadian GDP slipped to 0.0%. In the US, CB Consumer Confidence fell to 86.0 points, well short of expectations.

The Canadian dollar has been no match for the US dollar, losing about 200 points last week. The loonie has stabilized since then, but remains under strong pressure. The currency didn’t get any help as Canadian GDP posted a flat 0.0%, down from the previous release of 0.3%. Canadian GDP is released monthly, unlike most other developed countries which post GDP on a quarterly basis. The key indicator fell short of the estimate of 0.2% and this could put more pressure on the shaky Canadian dollar. Meanwhile, Canadian inflation levels remain at very low levels, as the Raw Materials Price Index came in at -2.2%, marking its third decline in four readings.

Earlier in the week, US Pending Home Sales posted a decline of 1.0%, compared to last month’s gain of 3.3%. The important housing indicator has shown strong movement, resulting in readings that have been well off market estimates. US housing indicators continue to paint a mixed picture, as New Home Sales jumped last month, while Existing Home Sales softened and was well short of  expectations.

USD/CAD for Tuesday, September 30, 2014

USD/CAD September 30 at 15:05 GMT

USD/CAD 1.1179 H: 1.1205 L: 1.1135

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.0961 1.1004 1.1124 1.1278 1.1414 1.1493

 

Further levels in both directions:

 

OANDA’s Open Positions Ratio

USD/CAD ratio is pointing to gains in long positions on Tuesday. This is consistent with the movement of the pair, as the US dollar has posted slight gains. The ratio has a majority of short positions, indicating trader bias towards the Canadian dollar moving to higher ground.

 

USD/CAD Fundamentals

* Key releases are in highlighted bold.

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher [4]

Currency Analyst at Market Pulse [5]
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.