Yesterday’s trade saw USD/CAD within the range of 1.2734-1.2840. The pair closed at 1.2761, retreating 0.44% on a daily basis. It has been the 55th drop in the past 111 trading days and also a third consecutive one. The daily low has been the lowest level since May 4th, when a low of 1.2693 was registered. The major pair has gone down 2.73% so far in June, following a 4.31% surge in the prior month.
At 6:58 GMT today USD/CAD was inching down 0.24% on the day to trade at 1.2731. The pair touched a daily high at 1.2761 during the early phase of the Asian trading session, undershooting the daily R1 level, and a daily low at 1.2725 during late Asian trade.
Canadas dollar tested highs unseen since early May against its US counterpart, as crude oil futures registered highs unseen since October 9th 2015 on Tuesday. Crude oil marked its 67th gain out of the past 122 trading days on June 7th. Oil for July delivery went up as high as $50.52 per barrel and closed at $50.38, surging 1.47% compared to Monday’s close. As of 7:04 GMT today the commodity was inching down 0.02% to trade at $50.37, after going down as low as $50.35 per barrel earlier.
On Wednesday USD/CAD trading may be influenced by the following macroeconomic reports as listed below.
Fundamentals
United States
Job Openings
The number of job openings in the United States probably decreased to 5.672 million in April from a month ago, according to the median forecast by experts. If so, this would be the lowest number of job openings since February, when a revised up 5.608 million positions were reported. In March a total of 5.757 million job openings were estimated, as the number of job openings waiting to be filled rose in professional and business services (+124 000), transportation, warehousing, and utilities (+35 000) and non-durable goods manufacturing (+29 000). At the same time, there were fewer job openings in retail trade (-80 000), educational services (-36 000) and wholesale trade (-35 000) during the same month.
This indicator refers to all job positions that are open, but not filled on the last business day of the month. Job openings are part of the Job Openings and Labor Turnover Survey (JOLTS), which gathers data from about 16 400 non-farm establishments including retailers and manufacturers, as well as federal, state, and local government entities in the 50 states and the District of Columbia. The survey assesses the unmet demand for labor in the labor market. A lower-than-projected level of job openings will usually have a limited bearish effect on the US dollar. The Bureau of Labor Statistics is to release the official report at 14:00 GMT.
Canada
Housing Starts
The number of housing starts in Canada probably dropped to the seasonally adjusted annual level of 190 000 in May from 191 500 in April. If so, Mays figure would be the lowest since January, when a revised down level of 165 100 was reported. Urban housing starts went down 4.6% to 174 810 units in April, as the multiple segment registered a 4.0% slump to 117 851 units and the single-detached segment shrank 5.8% to reach 56 959 units. In April urban housing starts went down in regions such as Ontario and Quebec, while increasing in the Prairies, British Columbia and Atlantic Canada. At the same time, housing starts in rural areas were reported at a seasonally adjusted annual level of 16 702 during the period.
Housing starts are considered as a key indicator, reflecting the strength of the nation’s housing sector. In case the number of housing starts decreased more than anticipated in May, this would have a moderate bearish effect on the Canadian dollar. The official report by the Canadian Mortgage and Housing Corporation is due out at 12:15 GMT.
Building Permits
The overall value of building permits in Canada, issued by municipalities, probably increased 1.5% in April, according to expectations. The total value of building permits in the country went down 7.0% to reach CAD 6.9 billion in March compared to a month ago, due to lower construction intentions for commercial buildings in Alberta, Ontario and British Columbia. The value of non-residential building permits plummeted 22.8% to USD 2.4 billion, dragged down by construction intentions for commercial (-27.7%), institutional (-12.2%) and industrial buildings (-17.1%). At the same time, the value of residential building permits went up 4.8% to USD 4.4 billion in March, supported by multi-family dwellings (up 12.1%).
Building permits, as an indicator, provide information regarding demand in Canada’s housing sector. In case the total value of permits increased more than expected in April from a month earlier, this would have a limited bullish effect on the Canadian dollar. Statistics Canada is expected to release the official numbers at 12:30 GMT.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for USD/CAD are presented as follows:
R1 – 1.2771
R2 – 1.2780
R3 (range resistance) – 1.2790
R4 (range breakout) – 1.2819
S1 – 1.2751
S2 – 1.2742
S3 (range support) – 1.2732
S4 (range breakout) – 1.2703
By using the traditional method of calculation, the weekly pivot levels for USD/CAD are presented as follows:
Central Pivot Point – 1.2997
R1 – 1.3082
R2 – 1.3231
R3 – 1.3316
S1 – 1.2848
S2 – 1.2763
S3 – 1.2614
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