News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Wall Street
Bearish
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
More View more
Real Time News
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/IRS9MaA7h8
  • The Federal Reserve rate decision is likely to sway the near-term outlook for the price of gold as the central bank appears to be on track to scale back monetary support. Get your weekly gold forecast from @DavidJSong here: https://www.dailyfx.com/forex/fundamental/forecast/weekly/CHF/2021/09/18/Gold-Price-Outlook-Hinges-on-Fed-Rate-Decision-Forward-Guidance.html https://t.co/dWWxtErjK0
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/4qxwiJsV1K
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/stMPuq0VXR
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/v6RGICQvge
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/rws9LHJV3E
  • RT @FxWestwater: Japanese Yen Forecast: JPY Crosses Eye BoJ, CPI as Haven Flows Bolster Yen Strength Link: https://www.dailyfx.com/forex/fundamental/forecast/weekly/jpy/2021/09/18/Japanese-Yen-Forecast-JPY-Crosses-Eye-BoJ-CPI-as-Haven-Flows-Bolster-Yen-Strength.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https:/…
  • Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Learn more about time-frame analysis here: https://t.co/9S5tXIs3SX https://t.co/FVisZuTP6M
  • Stocks appear to be in a corrective phase but could get put to the test; levels and lines to watch in the days ahead. Get your weekly equities forecast from @PaulRobinsonFX here: https://t.co/H1BaTlIHjY https://t.co/zP3mjfslSD
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/Of1thU4zXw
USD/CAD Risks Further Losses on Upbeat Canada GDP, Slowing U.S. NFP

USD/CAD Risks Further Losses on Upbeat Canada GDP, Slowing U.S. NFP

Tyler Yell, CMT, Currency Strategist
USD/CAD Risks Further Losses on Upbeat Canada GDP, Slowing U.S. NFP

Fundamental Forecast for CAD: Bullish

USD/CAD dropped aggressively on Friday when Canada Released May Employment figures that far surpassed what economists were expecting. Expectations were around 1,750 gain in employment, but the print at 13,800 brought USD/CAD down by ~80 pips. While the drop retraced going into Friday’s close, the trend of Canada’s economic data is clear, and it’s strong where many others are weak.

The Recent Economic Data Trend in Canada

The economic trend has impressed Canadian Dollar Bulls and depressed Canadian Dollar bears. Many see the markets as a game of expectations, and the Canadian Economy continues to defy expectations. Many traders thought the tragic wildfires in Alberta would halt hiring or hurt the economy, but it appears that Trudeau’s reform package is lifting the economy to relative great heights.

In addition to today’s impressive Employment report that also showed the unemployment rate drop to 6.9%, well below expectations of 7.2%, there are new commitments from businesses coming to Canada that could continue to lift the economic picture. On Friday, PM Trudeau spoke in Oshawa, Ontario about the upcoming General Motors investment for high-end automotive R&D that could lead to further well-paying jobs and also display the economies ability to diversify away from the oil industry.

Economic Data on Deck for Canada This Week

Canadian Consumer Price Index, which has been the envy of many central bankers, will be released on Friday. The prior print of 0.2% is expected to maintain at 0.2% with a possible weakening in the YoY component of 2.0% down from 2.2%. Many are looking to CPI to indicate softness in the Canadian economy, but as noted earlier, they have to look hard to find weakness compared to other economies, and many are coming up empty as economic data points continue to surprise economist.

A minor data point compared to the inflation reading on Friday will be the Manufacturing Sales on Wednesday. The prior print of -0.9% MoM and 3.1% annualized will be a basis to compare Wednesday print. However, the print will be discounted given the large macro even south of the border when the Federal Reserve releases their June rate decision at 2:00 pm EST.

Global Macro Influences on the Canadian Dollar

The Federal Reserve’s 2016 interest rate path has been less stable than the flight of a happy bumble bee. At the start of the year, we were coming off the December hike and a Dot Plot that showed four expected rate hikes from the Federal Reserve. As of mid-may, many felt that we’d come down to two rate hikes. However, looking at the interest rate probabilities data from Bloomberg, the only priced in rate hike (> 50% probability of a 25bp hike) is the December meeting.

Either way, a continuation of doubtful future rate hikes from the Federal Reserve, thanks likely in large part to an abysmal May employment report last Friday would further widen the spread between the trajectory of Canada’s economy and that of the United States. Similarly, we could continue to see gains in the Loonie relative to the greenback.

Sentiment Analysis Shows Bulls May Starting Loading Back Up Again

Data source: Speculative Sentiment Index, Chart source: Python. Prepared by DailyFX Team

The chart above can help you see how sentiment shows turns in the market as well as acceleration points. When looking at sentiment,crowd sentiment has moved positiveproviding favor for more downside. In the second-half of May, the trend has picked up acceleration as more retail USD/CAD longs join the act. This loading in is visualized with the green line below the sentiment and price chart.

We use our Speculative Sentiment Index as a contrarian indicator to price action, and the fact thatthe majority of traders are net-long at a bull: bear of 1.48 as 60% of traders are long means that a bearish USD/CAD signal is currently at play per our Speculative Sentiment Index.

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

DISCLOSURES