We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Mixed
More View more
Real Time News
  • RT @stlouisfed: St. Louis Fed President Jim Bullard talked about unemployment rate estimates for the second quarter and his economic outloo…
  • (Asia AM) The Australian Dollar fell with $AUDUSD at risk to reversing its bounce off March lows. Futures are pointing higher after the #Fed eased capital requirements, leaving the #Yen vulnerable - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2020/04/02/Australian-Dollar-at-Risk-as-AUDUSD-Descends-Yen-May-Fall-Ahead.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/GYtYCjHwha
  • 🇦🇺 (AUD) NAB Business Confidence (1Q), Actual: -11 Expected: N/A Previous: -2 https://www.dailyfx.com/economic-calendar#2020-04-02
  • 🇯🇵 JPY Monetary Base (YoY) (MAR), Actual: 2.8% Expected: N/A Previous: 3.6% https://www.dailyfx.com/economic-calendar#2020-04-01
  • 🇯🇵 JPY Monetary Base End of period (MAR), Actual: ¥509.8t Expected: N/A Previous: ¥515.9t https://www.dailyfx.com/economic-calendar#2020-04-01
  • Market snapshot: US equity futures pointing higher despite stock markets swimming in red at the end of Wall Street's trading session. #NZD edging slightly higher vs G10 FX.
  • The $USD may return to the offensive as markets flee to cash amid fears of deep global recession thanks to the still-raging #coronavirus outbreak. Get your US Dollar update from @IlyaSpivak here: https://t.co/g1us4ZbYR5 https://t.co/DWWrIOCEd2
  • Heads Up:🇯🇵 JPY Monetary Base End of period (MAR) due at 23:50 GMT (15min), Actual: N/A Expected: N/A Previous: ¥515.9t https://www.dailyfx.com/economic-calendar#2020-04-01
  • Heads Up:🇯🇵 JPY Monetary Base (YoY) (MAR) due at 23:50 GMT (15min), Actual: N/A Expected: N/A Previous: 3.6% https://www.dailyfx.com/economic-calendar#2020-04-01
  • $AUD chart positioning suggests prices have set a swing top near the 0.62 figure. Re-engaging the long-term downtrend against $USD may follow. Get your AUD/USD market update from @IlyaSpivak here:https://t.co/OIEDlId6HZ https://t.co/9BW8ugnuEV
Upbeat Canada GDP Report to Fuel USD/CAD Losses

Upbeat Canada GDP Report to Fuel USD/CAD Losses

2018-05-31 11:00:00
David Song, Strategist
Share:

Trading the News: Canada Quarterly Gross Domestic Product (GDP)

Updates to Canada’s Gross Domestic Product (GDP) report may fuel the recent decline in USD/CAD as the growth rate is projected to pick up to an annualized 1.9% from 1.7% during the last three-months of 2017.

Image of DailyFX economic calendar

USD/CAD continues to pullback from the May-high (1.3047) following the Bank of Canada (BoC) interest rate decision as the central bank adopts a more hawkish tone, and signs of stronger growth may encourage Governor Stephen Poloz and Co. to further normalize monetary policy in 2018 as ‘inflation in Canada has been close to the 2 per cent target and will likely be a bit higher in the near term than forecast in April.’

In turn, an upbeat GDP report may spark a bullish reaction in the Canadian dollar, with USD/CAD at risk for a larger pullback as market participants boost bets for an imminent BoC rate-hike. However, a dismal development may undermine the recent decline in USD/CAD as it encourages the BoC to stick to the wait-and-see approach, and the central bank may merely attempt to buy more time at the next meeting on July 11 as officials pledge to ‘look through the transitory impact of fluctuations in gasoline prices.

Impact that Canada GDP has had on USD/CAD during the previous quarter

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

4Q

2017

03/02/2018 13:30:00 GMT

2.0%

1.7%

+10

+8

4Q 2017 Canada Gross Domestic Product (GDP)

USD/CAD10-Minute Chart

Image of USDCAD 10-minute chart

Canada grew an annualized 1.7% during the last three months of 2017 after expanding a revised 1.5% in the third-quarter, with the growth rate climbing 3.3% in the month of December. A deeper look at the report showed Business Investments increasing 9.6% per annum to lead the advance, with household consumption rising 2.1%, while the saving rate climbed to 4.2% during the same period to mark the highest reading since 4Q 2016.

Despite the limited reaction, the Canadian dollar struggled to hold its ground throughout the North American trade, with the pair ending the day at 1.2885. Review the DailyFX Advanced Guide for Trading the News to learn our 8 step strategy.

USD/CAD Daily Chart

Image of USDCAD daily chart
  • The failed attempt to test the 2018-high (1.3125) raises the risk for a larger correction in USD/CAD especially as the Relative Strength Index (RSI) preserves the bearish formation from earlier this year.
  • Lack of momentum to close above the 1.2980 (61.8% retracement) to 1.3030 (50% expansion) region may keep USD/CAD within the broad range from earlier this year, with a move back below 1.2830 (38.2% retracement) raising the risk for a run at the Fibonacci overlap around 1.2720 (38.2% retracement) to 1.2770 (38.2% expansion).
  • Next region of interest comes in around 1.2620 (50% retracement) followed by the overlap around 1.2440 (23.6% expansion) to 1.2510 (78.6% retracement), which sits just beneath the April-low (1.2527).

Additional Trading Resources

New to the currency market? Want a better understanding of the different approaches for trading? Start by downloading and reviewing the DailyFX Beginners Guide!

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader series on how to effectively use leverage along with other best practices that any trader can follow.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.