11 Oct 2013
USD/CAD sits on the fence ahead of Canadian labor data, BoC outlook
FXstreet.com (Athens) – The USD/CAD after a series of five daily uptrend closures, is getting caught in an almost unchanged trend behavior since the early Asian trading session, mainly due to the fact that we are ahead of a heavy calendar data day.
USD/CAD putting riddles to market participants ahead of Canadian labor data, BoC
The USD/CAD is trading at the time of writing almost at the same exact area since the kick-off of the Asian trading session, i.e. hovering around 1.0396 level and well capped by 1.0400. While the risk-off sentiment hit the “snooze” button since the safe-haven demand fades away on hopes of a US budget deal the USD/CAD seems that is stands at crossroads. Elaborating on, today we are ahead of very crucial Canadian data releases; the Canadian jobs report will be released, with economists predicting that Canadian economy created roughly 10.000 jobs in the first month of the fall. Traders should also bear into consideration that over the past six months, the Canadian jobs reports have averaged a 'surprise' of over 40,000. That is exactly 4 times the current consensus, thus traders might not find out-of-the blue a different estimation. In addition to the above, the BoC quarterly business outlook and loan officer surveys will be released. Both releases will garner to a major extent a considerable market attention, due to the fact that the new governor of BoC will provide hints on inflationary expectations, as well as on investment intentions.
Technical Outlook on USD/CAD
Shaun Osborne Chief FX Strategist on behalf of Toronto FX Research Team, from TD Securities mentions that “The daily picture supports the impression of a minor correction pending in USD/CAD. A daily “doji” candle against former trend support (now resistance) suggests the move up has stalled. A clearer signal is contingent on the close today though and that might hinge on whether the market gets much traction below the 40-day MA which has provided some support for the market so far. Overall, we still rather think the broader picture is USD-positive—due to the rebound from the 200-day MA and the extension this week through the low 1.03 area that has c
apped the market since late September—but gains may remain a bit of a grind. We prefer to look for buying opportunities—which has been our default position since the start of the year.”
USD/CAD putting riddles to market participants ahead of Canadian labor data, BoC
The USD/CAD is trading at the time of writing almost at the same exact area since the kick-off of the Asian trading session, i.e. hovering around 1.0396 level and well capped by 1.0400. While the risk-off sentiment hit the “snooze” button since the safe-haven demand fades away on hopes of a US budget deal the USD/CAD seems that is stands at crossroads. Elaborating on, today we are ahead of very crucial Canadian data releases; the Canadian jobs report will be released, with economists predicting that Canadian economy created roughly 10.000 jobs in the first month of the fall. Traders should also bear into consideration that over the past six months, the Canadian jobs reports have averaged a 'surprise' of over 40,000. That is exactly 4 times the current consensus, thus traders might not find out-of-the blue a different estimation. In addition to the above, the BoC quarterly business outlook and loan officer surveys will be released. Both releases will garner to a major extent a considerable market attention, due to the fact that the new governor of BoC will provide hints on inflationary expectations, as well as on investment intentions.
Technical Outlook on USD/CAD
Shaun Osborne Chief FX Strategist on behalf of Toronto FX Research Team, from TD Securities mentions that “The daily picture supports the impression of a minor correction pending in USD/CAD. A daily “doji” candle against former trend support (now resistance) suggests the move up has stalled. A clearer signal is contingent on the close today though and that might hinge on whether the market gets much traction below the 40-day MA which has provided some support for the market so far. Overall, we still rather think the broader picture is USD-positive—due to the rebound from the 200-day MA and the extension this week through the low 1.03 area that has c
apped the market since late September—but gains may remain a bit of a grind. We prefer to look for buying opportunities—which has been our default position since the start of the year.”