The Canadian dollar has edged higher in the Tuesday session. In North American trade, USD/CAD is trading at 1.2756, up 0.28% on the day. On the release front, there are no Canadian events for a second straight day. In the US, Retail Sales came in at 0.6%, above the estimate of 0.3%. Core Retail Sales also looked sharp, with the gain of 0.5% beating the forecast of 0.3%. There was more good news from the manufacturing sector, as the Empire State Manufacturing Index soared to 25.2, crushing the estimate of 10.1 points. On Wednesday, the US releases Building Permits and Housing Starts. As well, the FOMC publishes its minutes from the July FOMC meeting.
It’s been a disappointing August for the Canadian dollar, which has dropped 2.2% this month. The currency has become less attractive with the current tensions in the Korean peninsula. Investors have lost some of their risk appetite and stayed away from minor currencies such as the Canadian dollar, preferring safe-haven assets such as the Japanese yen and gold. Still, Canadian fundamentals are in good shape, as recent employment and housing numbers have been strong. The currency is closely linked to oil prices, with the loonie gaining ground in July as oil prices went up, only to retract in August as crude prices have dropped this month.
The markets were jittery last week, as the saber-rattling between the US and North Korea reached a fever pitch. North Korea threatened to fire missiles at Guam, and President Trump warned of severe consequences in response. The crisis weighed on stock markets last week, but the markets have rebounded as the war of words between Washington and Pyongyang has abated somewhat, increasing risk appetite on the part of investors. Still, tensions remain high in the Korean peninsula, and if either side ratchets up the rhetoric, the markets could again lose ground, and this could hurt the Canadian dollar.
Tuesday (August 15)
- 8:30 US Core Retail Sales. Estimate 0.3%. Actual 0.5%
- 8:30 US Retail Sales. Estimate 0.3%. Actual 0.6%
- 8:30 US Empire State Manufacturing Index. Estimate 10.1. Actual 25.2
- 8:30 US Import Prices. Estimate 0.1%. Actual 0.1%
- 10:00 US Business Inventories. Estimate 0.4%. Actual. 0.4%
- 10:00 US NAHB Housing Market Index. Estimate 64. Actual 68
- 14:00 US TIC Long-Term Purchases. Estimate 28.3B
Wednesday (August 16)
- 8:30 US Building Permits. Estimate 1.25M
- 8:30 US Housing Starts. Estimate 1.23M
- 14:00 US FOMC Meeting Minutes
*All release times are GMT
*Key events are in bold
USD/CAD for Tuesday, August 15, 2017
USD/CAD Tuesday, August 15 at 10:30 EDT
Open: 1.2722 High: 1.2779 Low: 1.2718 Close: 1.2756
USD/CAD was flat in the Asian session and inched higher in the European sessions. The pair has posted small gains in North American trade
- 1.2701 is providing support
- 1.2815 is the next resistance line
- Current range: 1.2562 to 1.2701
Further levels in both directions:
- Below: 1.2701, 1.2562, 1.2445 and 1.2302
- Above: 1.2815, 1.2943 and 1.3016
OANDA’s Open Positions Ratio
USD/CAD ratio is unchanged in the Tuesday session. Currently, long positions have a strong majority (68%), indicative of trader bias towards USD/CAD continuing to move upwards.
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.