The shaky Canadian dollar has resumed its losing ways on Tuesday. USD/CAD has risen to the mid-1.08 range, its highest level since mid-June. On the release front, CB Consumer Confidence stunned the markets, pushing above the 90-point level for the first time since late 2007. There are no Canadian releases on Tuesday.
If CB Consumer Confidence is any indication, the US consumer is brimming with optimism about the economy. The key indicator jumped to 90.9 points, crushing the estimate of 85.5 points. This was the indicator’s highest level since September 2007. Consumer confidence is closely tracked by analysts since a confident consumer is likely to increase consumption, which is critical for economic growth. Meanwhile, traders can expect stronger currency movement on Wednesday, with three key events on the calendar. The Federal Reserve will release a policy statement and we’ll get a look at Advance GDP and the ADP Nonfarm Payrolls. If these releases surprise the markets, we could see increased activity in the currency markets.
Like its giant southern neighbor, Canada has suffered from very low inflation levels, indicative of an underperforming economy. On Wednesday, the markets will get a look at inflation in the manufacturing sector, with a forecast of stronger numbers in June. Canadian GDP, which is released each month, will be published on Thursday. If these indicators exceed expectations, we could see the loonie reverse its downward trend.
USD/CAD for Tuesday, July 29, 2014
USD/CAD July 29 at 15:00 GMT
USD/CAD 1.0838 H: 1.0847 L: 1.0797
- USD/CAD was unchanged in the Asian session. The pair moved higher late in the European session and the Canadian dollar remains under pressure in North American trading.
- 1.0852 is under strong pressure as the US dollar gains strength. This is followed by 1.0961, which has held firm since early June.
- 1.0775 is providing support. 1.0678 follows.
- Current range: 1.0775 to 1.0852
Further levels in both directions:
- Below: 1.0775, 1.0678, 1.0572 and 1.0414
- Above: 1.0852, 1.0961, 1.1004 and 1.1124
OANDA’s Open Positions Ratio
USD/CAD ratio is unchanged in Tuesday trade. This is not consistent with the pair’s movement, as the US dollar has moved upwards. The ratio has a substantial majority of long positions, indicative of strong trader bias towards the US dollar continuing to posts gains.
- 13:00 US S&P/CS Composite-20 HPI. Estimate 9.8%. Actual 9.3%.
- 14:00 US CB Consumer Confidence. Estimate 85.5 points.
*Key releases are highlighted in bold
*All release times are GMT