USD/CAD – Canadian Dollar Fluctuating Ahead of Wholesale Sales

The Canadian dollar has ticked higher in the Tuesday session. Currently, USD/CAD is trading at 1.2810, down 0.08% on the day. On the release front, Canada releases Wholesale Sales, which is expected to edge higher to 0.6%. The US will release Existing Home Sales, with an estimate of 5.42 million. As well, Fed Chair Janet Yellen will speak at an event in New York City. Wednesday is busy, as the US releases employment, durable goods and consumer confidence reports. Also, the Federal Reserve releases the minutes of its November policy meeting.

Like its southern neighbor, Canada continues to grapple with low inflation levels. There were no surprises on Friday, as CPI posted a negligible gain of 0.1% for October, matching the estimate. The Bank of Canada remains cautiously optimistic about inflation – on Wednesday, Senior Deputy Governor Carolyn Wilkins said she expected wages to rise as the economy improved. Inflation levels remain well below the Bank’s inflation target of 2.0%, and the markets don’t expect another rate hike until 2018.

 

Will we see a triple sweep from housing indicators? The markets are forecasting that Existing Home Sales will improve in October, following sharp housing data on Friday. Building Permits for single-family homes jumped to 1.30 million, above the estimate of 1.25 million. The annualized pace of 839,000 building permits in October was the fastest since September 2007. Housing Start also sparkled, accelerating to 1.29 million, compared to an estimate of 1.19 million. The catalyst for the strong numbers were hurricanes Harvey and Irma, which caused massive damage in the southern part of the US. With rebuilding efforts well underway, construction numbers should remain strong in the fourth quarter, which is good news for the  US economy.

 

USD/CAD Fundamentals 

Tuesday (November 21)

  • 8:30 Canadian Wholesale Sales. Estimate 0.6%
  • 10:00 US Existing Home Sales. Estimate 5.42M
  • 18:00 US Federal Reserve Chair Janet Yellen Speaks

Wednesday (November 22)

  • 8:30 US Core Durable Goods Orders. Estimate 0.4%
  • 8:30 US Unemployment Claims. Estimate 241K
  • 8:30 US Core Durable Goods Orders. Estimate 0.4%
  • 8:30 US Durable Goods Orders. Estimate 0.4%
  • 10:00 US Revised UoM Consumer Sentiment. Estimate 98.2
  • 14:00 US FOMC Meeting Minutes

*All release times are GMT

*Key events are in bold

 

USD/CAD for Tuesday, November 21, 2017

USD/CAD, November 21 at 8:05 EDT

Open: 1.2820 High: 1.2837 Low: 1.2789 Close: 1.2810

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2532 1.2630 1.2757 1.2860 1.3015 1.3165

USD/CAD was flat in the Asian session and is showing some volatility in European trade

  • 1.2757 is providing support
  • 1.2860 is the next resistance line
  • Current range: 1.2757 to 1.2860

Further levels in both directions:

  • Below: 1.2757, 1.2630 and 1.2532
  • Above: 1.2860, 1.3015 and 1.3165

OANDA’s Open Positions Ratio

USD/CAD ratio is unchanged this week. Currently, long positions have a majority (59%), indicative of trader bias towards USD/CAD breaking out and moving higher.

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

Currency Analyst at Market Pulse
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.