USD/CAD – Canadian dollar quiet as GDP up 0.1%

The Canadian dollar has posted small losses in the Wednesday session. Currently, USD/CAD is trading at 1.3138, up 0.21% on the day. On the release front, Canada’s GDP posted a small gain of 0.1%, above the estimate of 0.0%. Later in the day, Bank of Canada Governor Stephen Poloz continues his testimony on Parliament Hill. In the U.S, ADP nonfarm payrolls came in at 227 thousand, much stronger than the estimate of 188 thousand. This is the first of a host of employment releases, highlighted by wage growth and nonfarm payrolls on Friday.

It’s been a rough October for the Canadian dollar, as diminished risk appetite has translated into softer demand for minor currencies like the Canadian dollar. The currency has slipped 1.76% in October, despite a Bank of Canada rate hike last week. At the forefront of geopolitical tensions is the trade war between the U.S and its major partners, particularly with China. Tensions between the world’s two largest economies show no signs of easing, and the Trump administration continues to threaten further severe tariffs on China. The U.S has also imposed steel tariffs on its two neighbors, Canada and Mexico. On Monday, Mexico’s deputy commerce minister said that Mexico would not sign the new USMCA pact, which replaces NAFTA, unless the U.S agreed to remove the tariffs against Mexico and Canada.

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USD/CAD Fundamentals

Wednesday (October 31)

  • 8:15 US ADP Nonfarm Employment Change. Estimate 188K. Actual 227K
  • 8:30 Canadian GDP. Estimate 0.0%. Actual 0.1%
  • 8:30 Canadian RMPI. Estimate -0.5%. Actual -0.9%
  • 8:30 Canadian IPPI. Estimate 0.0%. Actual 0.1%
  • 8:30 US Employment Cost Index. Estimate 0.7%. Actual 0.8%
  • 9:45 Chicago PMI. Estimate 60.1
  • 10:30 US Crude Oil Inventories. Estimate 3.6M
  • 16:30 Canadian BoC Governor Poloz Speaks

Thursday (November 1)

  • 8:30 US Unemployment Claims. Estimate 213K
  • 10:00 US ISM Manufacturing PMI. Estimate 59.0

*All release times are DST

*Key events are in bold

USD/CAD for Wednesday, October 31, 2018

USD/CAD, October 31 at 8:10 DST

Open: 1.3111 High: 1.3140 Low: 1.3107 Close: 1.3127

USD/CAD Technical

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

In the Asian session, USD/CAD edged lower but recovered.  in European trade, the pair rose slightly but has given up these gains

  • 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

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.