USD/CAD – Lack of events leaves Canadian dollar unchanged

The Canadian dollar is trading sideways in the Monday session. Currently, USD/CAD is trading at 1.3108, up 0.01% on the day. On the release front, it’s a quiet start to the week, with no Canadian events. In the U.S, there are two minor consumer indicators.

There was more good news for the U.S economy on Friday, as Advance GDP posted an impressive gain of 3.5%, above the estimate of 3.3%. This was down from the sizzling Final GDP for Q2, which came in at 4.2%. Still, analysts were not expecting a repeat of the Q2 performance, and the U.S dollar moved higher on Friday. With global stock markets spiraling lower, risk appetite has dampened as investors flock to the U.S dollar at the expense of the Canadian dollar and other currencies. A rash of geopolitical hotspots has weighed on investor sentiment, including the spike in Italian debt, the Brexit impasse and the U.S-China trade war.

As widely expected, the BoC raised the benchmark rate on Wednesday by a quarter-point, to 1.75%. The BoC gave the economy high marks, while at the same time noting that lower oil prices and the U.S-China trade dispute could dampen economic growth. BoC Deputy Governor Carolyn Wilkins noted that even with the increase, rate policy remains “accommodative”, as the “neutral rate” stance won’t be reached until rates are between 2.5% and 3.5%. As the move was priced in, the Canadian dollar could only muster slight gains on Wednesday. Domestically, the situation is bright, and the BoC will be looking at further interest rates in order to boost inflation while ensuring that the strong Canadian economy does not overheat.

Euro pressured as Merkel’s CDU loses ground

U.S Dollar Stands Tall

Europe higher as tariffs hit Chinese stocks

USD/CAD Fundamentals

Monday (October 29)

  • 8:30 US Core PCE Price Index. Estimate 0.1%
  • 8:30 US Personal Spending. Estimate 0.4%
  • 8:30 US Personal Income. Estimate 0.4%
  • Tentative – US Loan Officer Survey

Tuesday (October 30)

  • 10:00 US CB Consumer Confidence. Estimate 136.3

*All release times are DST

*Key events are in bold

USD/CAD for Monday, October 29, 2018

USD/CAD, October 29 at 8:10 DST

Open: 1.3107 High: 1.3115 Low: 1.3083 Close: 1.3108

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2831 12970 1.3067 1.3198 1.3292 1.3383

USD/CAD showed little movement in the Asian session. The pair has been marked by choppy movement in European trade

  • 1.3067 is providing resistance
  • 1.3198 is the next resistance line
  • Current range: 1.3067 to 1.3198

Further levels in both directions:

  • Below: 1.3067, 1.2970, 1.2831 and 1.2733
  • Above: 1.3198, 1.3292 and 1.3387

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

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.