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
  • The ISM manufacturing index plays an important role in forex trading, with ISM data influencing currency prices globally. Learn about the importance of the ISM manufacturing index here: https://t.co/Xr3xtoFpZy https://t.co/j5xDAG6LLb
  • While the meetings of central bankers in the US, Japan and the UK will be front, left and center of traders’ minds this coming week, it would be wise not to ignore next Sunday’s German Federal Election. Get your euro forecast from @MartinSEssex here: https://t.co/m920Uvmngm https://t.co/yQYtfHf66s
  • Take a closer look visually at the most influential global importers and exporters here: https://t.co/G58J1dg6y3 https://t.co/Dqq9S9vGvo
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/lccPTTlvj0
  • GBP/USD’s consolidation could end soon if price breaks out of a symmetrical triangle in play since July. At this time, a downside breakout is likely following the appearance of a death cross. Get your weekly $GBP forecast from @DColmanFX here: https://t.co/WIKdSesfkJ https://t.co/Fx0qr32xgI
  • 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
USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

David Song, Strategist

Canadian Dollar Talking Points

USD/CAD consolidates ahead of Canada’s Employment report and the exchange rate may continue to face range bound conditions going into the Easter holiday as it fails to track the pennant formation carried over from the previous month.

USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

USD/CAD attempts to retrace the decline from earlier this week as the Bank of Canada’s (BoC) Business Outlook Survey reveals that “business sentiment had softened in most regions even before concerns around COVID‑19,” and the update to the employment report may produce headwinds for the Canadian Dollar as the economy is anticipated to shed 500K jobs in March.

Image of DailyFX Canada economic calendar

At the same time, the Unemployment Rate is expected to increase to 7.5% from 5.6% in February, which would mark the highest reading since 2012, and the economic shock from the coronavirus may force the BoC to further support Canadian households and businesses as the “Governing Council stands ready to take further action as required to support the Canadian economy and its financial system and to keep inflation on target.

It seems as though the BoC will rely on its unconventional tools to combat the weakening outlook for growth as the emergency rate cut in March “brings the policy rate to its effective lower bound,” and the central bank may look to expand its asset purchase programs over the coming months in order to “minimize any permanent damage to the structure of the economy.

In turn, Governor Stephen Poloz and Co. may continue to endorse a dovish forward guidance at their next meeting on April 15, and the BoC may continue to push monetary policy into uncharted territory as the central bank carries out the Commercial Paper Purchase Program while acquiring Government of Canada securities in the secondary market.

With that said, it remains to be seen if Canada’s Employment report will alter the near-term outlook for USD/CAD amid the limited reaction to the US Non-Farm Payrolls report, and the exchange rate may continue to face range bound conditions over the coming days as it fails to track the pennant formation carried over from the previous month.

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss potential trade setups.

USD/CAD Rate Daily Chart

Image of USD/CAD rate daily chart

Source: Trading View

  • Keep in mind, the near-term rally in USD/CAD emerged following the failed attempt to break/close belowthe Fibonacci overlap around 1.2950 (78.6% expansion) to 1.2980 (61.8% retracement), with the yearly opening range highlighting a similar dynamic as the exchange rate failed to test the 2019 low (1.2952) during the first full week of January.
  • The shift in USD/CAD behavior may persist in 2020 as the exchange rate breaks out of the range from the fourth quarter of 2019 and clears the October high (1.3383), but the Relative Strength Index (RSI) offers a mixed signal as the oscillator fails to retain the upward trend from earlier this year.
  • As a result, USD/CAD may face range bound conditions as it snaps the pennant formation carried over from the previous month.
  • However, the lack of momentum to hold above the 1.4010 (38.2% retracement) to 1.4040 (23.6% retracement) region may open up the Fibonacci overlap around 1.3810 (50% retracement) to 1.3830 (100% expansion), with the next area of interest coming in around 1.3720 (78.6% expansion).

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

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

DISCLOSURES