Yesterday’s trade saw USD/CAD within the range of 1.2975-1.3075. The pair closed at 1.3017, falling 0.31% on a daily basis. It has been the sixth loss in the past seven trading days.
At 9:14 GMT today USD/CAD was down 0.62% for the day to trade at 1.2935. The pair overcame the lower range breakout level (S4) and the weekly S2 level, as it touched a daily low at 1.2925 at 9:18 GMT. It has been the lowest level since July 29th, when a daily low of 1.2859 was registered. The latter is a possible level of support, as it also appears close to the 38.2% Fibonacci level of 1.2868, reflecting the ascent from May 14th low to September 29th high.
Today the cross may be influenced by a number of macroeconomic reports as listed below.
Fundamentals
United States
Export and import prices
The index of export prices probably fell for a fourth consecutive month in September, going down 0.2%, according to expectations. In August export prices dropped 1.4% compared to a month ago, or at the steepest rate since January 2015, when a 1.9% slump was registered. A drop in export prices implies higher demand in a medium term, while an increase suggests the opposite effect.
At the same time, the index of import prices probably dropped for a fourth month in a row in September as well, dipping 0.5%, according to the median forecast by analysts. In August import prices were 1.8% lower compared to a month ago, which has been the sharpest decline since January 2015. Back then a 3.1% plunge was registered. An increase in import prices implies potentially higher rate of consumer inflation in the country, while a decrease suggests the opposite effect.
The US Department of Labor is to release the official data at 12:30 GMT.
Canada
Employment change, Unemployment rate
The number of the employed people in Canada probably increased by 10 000 in September, according to market expectations. In August the number of the employed rose by 12 000, or the most since May, when a number of 58 900 was reported. Compared to 12 months earlier, Canadian employment rose by 193 000 (or 1.1%) in August. Full-time employment was up by 318 000 (or 2.2%), while part-time employment decreased by 125 000 (or 3.6%). Employment was higher among women aged 55 and older, while the rate edged down for men and women aged between 25 and 54. The total number of hours worked went up 2.1%. Youth unemployment rate fell to 13.1% in August from 13.2% in July, according to the report by the Statistics Canada. Creation of new job positions has a direct link to consumer spending and overall macroeconomic activity.
Meanwhile, the rate of unemployment in the country probably dropped to 6.9% in September from 7.0% in August. The latter has been the highest rate since August 2014.
A higher-than-expected rate of increase in employment and a drop in unemployment rate would have a strong bullish effect on the local currency. Statistics Canada is expected to release its official employment report at 12:30 GMT.
BoC Business Outlook Survey
At 14:30 GMT Bank of Canada will publish its Business Outlook Survey. The latter represents a summary of interviews conducted by the bank’s regional offices with the senior management of about 100 business entities, selected in accordance with the composition of the nation’s Gross Domestic Product. The major goal is to reflect the perspectives of these businesses on topics of key interest to the Bank of Canada, including demand and capacity pressures, as well as companies’ forward-looking views on economic activity. The survey encompasses opinions expressed by the respondents, which do not necessarily come in consonance with the Bank’s view or policy.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for USD/CAD are presented as follows:
R1 – 1.3026
R2 – 1.3035
R3 (range resistance) – 1.3045
R4 (range breakout) – 1.3072
S1 – 1.3008
S2 – 1.2999
S3 (range support) – 1.2990
S4 (range breakout) – 1.2962
By using the traditional method of calculation, the weekly pivot levels for USD/CAD are presented as follows:
Central Pivot Point – 1.3251
R1 – 1.3355
R2 – 1.3561
R3 – 1.3665
S1 – 1.3045
S2 – 1.2941
S3 – 1.2735
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