USD/CAD – Canadian dollar edges higher, Canadian manufacturing PMI next

The Canadian dollar has recorded small gains on Tuesday, after starting the week with slight losses. Currently, USD/CAD is trading at 1.3160, down 0.21% on the day. On the release front, there are no key indicators on the schedule. Canada will release Manufacturing PMI. In the US, Factory Orders are expected to rebound to 0.1% in May, after a dismal decline of 0.8% in April.

With the first week in July marked by holidays in Canada and the U.S, we are unlikely to see much movement from USD/CAD until later in the week. That could change on Friday, as Canada will release key employment data. Investors are also keeping a watchful eye, as the Bank of Canada holds a key policy meeting on July 11. The bank has been dropping strong hints that a rate hike could be coming soon. Last week, BoC Governor Stephen Poloz had a hawkish message for the markets, noting that inflation was on target and the domestic economy was performing well. However, Poloz also mentioned that the trade war between Canada and the U.S was hurting business investment.With the U.S showing no signs of easing its tariffs with major trading partners, including Canada, the BoC may decide to sit on fence and wait for trade tensions to ease before raising interest rates. A strong showing from Canadian job numbers on Friday could sway the bank to press the rate trigger next week.

USD/CAD Fundamentals

Tuesday (July 3)

  • 9:30 Canadian Manufacturing PMI
  • 10:00 US Factory Orders. Estimate 0.1%
  • Tentative – IBD/TIPP Economic Optimism. Estimate 54.2
  • All Day  – Total Vehicle Sales. Estimate 17.0M

*All release times are DST

*Key events are in bold

USD/CAD for Tuesday, July 3, 2018

USD/CAD, July 3 at 9:05 DST

Open: 1.3188 High: 1.3208 Low: 1.3133 Close: 1.3151

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2831 1.2970 1.3067 1.3160 1.3292 1.3436

USD/CAD was flat in the Asian session and has posted slight losses in European trade

  • 1.3067 is providing support
  • 1.3160 has switched to a resistance role following losses by USD/CAD. It is a weak line
  • Current range: 1.3067 to 1.3160

Further levels in both directions:

  • Below: 1.3067, 1.2970 and 1.2831
  • Above: 1.3160, 1.3292, 1.3436 and 1.3530

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.