USD/CAD – Strong Gains As Greenback Shoots Above 1.14

USD/CAD has posted strong gains on Tuesday, recovering from sharp losses on Monday. Early in the North American session, the pair is trading at the 1.14 line. In the US, there are no major releases on the schedule. Federal Reserve Chair Janet Yellen will deliver remarks at an event in Washington. There are no Canadian releases on Tuesday. On Wednesday, the BOC will set the benchmark interest rate for December, with the markets expecting the rate to remain at 1.00%.

In the US, ISM Manufacturing PMI dropped to 58.7 points, close to the previous release of 59.0 points. This easily beat the estimate of 57.9 points. The positive US manufacturing data stands in sharp contrast to the situation in the Eurozone and China. The Canadian dollar jumped on the news, as stronger activity in the US manufacturing sector is good news for Canadian exports to the US. On Friday, Canadian GDP came in at 0.4%, matching the estimate. Unlike the US, Canada releases GDP every month, rather than each quarter. The news was not as positive from RMPI, which showed a decline of -4.9%, a fourth straight decline for the manufacturing inflation index.

USD/CAD for Tuesday, December 2, 2014

USD/CAD December 2 at 15:35 GMT

USD/CAD 1.1402 H: 1.1424 L: 1.1319

 

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.1004 1.1124 1.1278 1.1414 1.1493 1.1669

 

  • USD/CAD was uneventful in the Asian session. The pair has posted gains in the European and North American sessions.
  • 1.1278 continues to provide strong support.
  • On the upside, 1.1414 is under strong pressure. Will the pair push above this line?
  • Current range: 1.1278 to 1.1414

Further levels in both directions:

  • Below: 1.1278, 1.1124, 1.1004, 1.0961 and 1.0886
  • Above: 1.1414, 1.1493, 1.1669 and 1.1723

 

OANDA’s Open Positions Ratio

USD/CAD ratio is pointing to gains in short positions on Tuesday. This is not consistent with the movement of the pair, as the US dollar has posted strong gains. The ratio is close to a split between long and short positions, indicative of a lack of trader bias regarding the pair’s next move.

USD/CAD Fundamentals

  • 13:10 US FOMC Member Stanley Fischer Speaks.
  • 13:30 US Federal Reserve Chair Janet Yellen Speaks.
  • 15:00 US Construction Spending. Estimate 0.6%. Actual 1.1%.
  • All Day – US Total Vehicle Sales. Estimate 16.6M.
  • 17:00 US FOMC Member Lael Brainard Speaks.

* Key releases are highlighted in 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

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.