Yesterday’s trade (in GMT terms) saw USD/CAD within the range of 1.2831-1.2919. The pair closed at 1.2844, edging down 0.14% compared to Tuesdays close. It has been the 151st drop in the past 318 trading days and also an eighth consecutive one. The major pair has increased its slump to 1.41% so far during the current month, following a 0.80% gain in July.
At 7:49 GMT today USD/CAD was shedding 0.27% on the day to trade at 1.2809. The pair touched a daily high at 1.2861 during early Asian trade, overshooting the daily R2 level, and a daily low at 1.2803 during the early phase of the European trading session.
Meanwhile, crude oil futures marked their 80th gain out of the past 173 trading days on August 17th. Oil for September delivery went up as high as $46.95 per barrel, or the highest price level since July 7th, and closed at $46.79, edging up 0.45% compared to Tuesday’s close. As of 7:50 GMT today the commodity was advancing 0.66% to trade at $47.10, after going up as high as $47.17 per barrel earlier. Crude oil prices and CAD valuation tend to be strongly positively correlated.
On Thursday USD/CAD trading may be influenced by the following macroeconomic reports and other events as listed below.
Fundamentals
United States
Initial, Continuing Jobless Claims
The number of people in the United States, who filed for unemployment assistance for the first time during the business week ended on August 12th, probably fell to 265 000, according to market consensus, from 266 000 in the preceding week.
The 4-week moving average, an indicator lacking seasonal effects, was 262 750, marking an increase by 3 000 compared to the preceding week’s revised down average.
The business week, which ended on August 5th, has been the 75th consecutive week, when jobless claims stood below the 300 000 threshold, which suggested a healthy labor market. It has been the longest streak since 1970.
Initial jobless claims number is a short-term indicator, reflecting lay-offs in the country. In case the number of claims met expectations or decreased further, this would have a moderate bullish effect on the US dollar.
The number of continuing jobless claims probably fell to the seasonally adjusted 2 140 000 during the business week ended on August 5th, according to the median forecast by experts, from 2 155 000 in the preceding week. The latter represented an increase by 14 000 compared to the revised up number of claims reported in the week ended on July 22nd. This indicator reflects the actual number of people unemployed and currently receiving unemployment benefits, who filed for unemployment assistance at least two weeks ago.
The US Department of Labor is to release the weekly report at 12:30 GMT.
Philadelphia Fed Manufacturing Index
The Philadelphia Fed Manufacturing Index probably improved to a reading of 2.0 in August, according to the median forecast by experts, after unexpectedly falling to a level of -2.9 in July. The latter has been the lowest index reading since January, when the gauge was reported at -3.5. In July, the gauge for inventories (-4.3 after being at -9.9 in June) and employment (-1.6 after being at -10.9 in June) improved, while the sub-index for new orders (11.8 after being at -3 in the prior month) and shipments (6.3 after being at -2.1 in June) came into positive territory.
A level above zero is indicative of improving business conditions, while a level below zero is indicative of worsening conditions. In case the index rose more than projected in August, this would have a moderate bullish effect on the US dollar. The Federal Reserve Bank of Philadelphia is expected to release the official results from the survey at 12:30 GMT.
Fed Speakers
At 14:05 GMT the Fed President for New York and a FOMC member, William Dudley, is expected to take a statement, followed by the Fed President for San Francisco and also a member to the Committee, John Williams, at 20:00 GMT. Any remarks made in regard to the US economic outlook or the Bank’s policy stance would heighten USD volatility.
Bond Yield Spread
The yield on Canada’s 2-year government bonds went as high as 0.603% on August 17th, or the highest level since July 29th (0.611%), after which it closed at 0.572% to add 0.005 percentage point compared to August 16th.
Meanwhile, the yield on US 2-year government bonds climbed as high as 0.774% on August 17th, or the highest level since July 27th (0.778%), after which it fell to 0.722% at the close to lose 2.8 basis points (0.028 percentage point) compared to August 16th.
The spread between 2-year US and 2-year Canadian bond yields, which reflects the flow of funds in a short term, narrowed to 0.150% on August 17th from 0.183% on August 16th. The August 17th yield spread has been the lowest one since August 4th, when the difference was 0.109%.
Daily, Weekly and Monthly Pivot Levels
By employing the Camarilla calculation method, the daily levels of importance for USD/CAD are presented as follows:
R1 – 1.2852
R2 – 1.2860
R3 (Range Resistance – Sell) – 1.2868
R4 (Long Breakout) – 1.2892
R5 (Breakout Target 1) – 1.2921
R6 (Breakout Target 2) – 1.2932
S1 – 1.2836
S2 – 1.2828
S3 (Range Support – Buy) – 1.2820
S4 (Short Breakout) – 1.2796
S5 (Breakout Target 1) – 1.2767
S6 (Breakout Target 2) – 1.2756
By using the traditional method of calculation, the weekly levels of importance for USD/CAD are presented as follows:
Central Pivot Point – 1.3023
R1 – 1.3121
R2 – 1.3290
R3 – 1.3388
R4 – 1.3487
S1 – 1.2854
S2 – 1.2756
S3 – 1.2587
S4 – 1.2419
In monthly terms, for USD/CAD we have the following pivots:
Central Pivot Point – 1.3038
R1 – 1.3244
R2 – 1.3460
R3 – 1.3666
R4 – 1.3872
S1 – 1.2822
S2 – 1.2616
S3 – 1.2400
S4 – 1.2184
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
