Seeking Alpha
Currencies, macro, fixed income
Profile| Send Message|
( followers)  

USD/CAD is not showing much movement on Tuesday, as the pair trades in the mid-1.10 range in the North American session. In economic news, Canadian Manufacturing Sales looked sharp, posting a six-month high. Later on in the day, BOC Governor Stephen Poloz addresses the Chamber of Commerce in Halifax. Over in the US, Building Permits beat the estimate, while Core CPI met market expectations. The markets are following fast-moving events in the Ukraine, as Crimea has voted to join Russia and the EU and the US have responded with limited sanctions.

Canadian Manufacturing Sales, a key event, jumped 1.5% in February, its best showing since last August. This easily beat the estimate of 1.1%. South of the border, US Building Permits jumped to 1.02 million, a four-month high. This was the indicator's highest level since October. US Core CPI came in with a weak gain of 0.1%, for the third straight month. Although this matched the estimate, the paltry gain points to persistently low inflation in the US, indicative of an underperforming economy.

Events are moving quickly in the Ukrainian crisis. Voters in Crimea voted overwhelmingly to join Russia in Sunday's referendum, and Russian President Putin has recognized Crimea as an independent state, paving the way for annexation. Putin addressed a special session of the Russian parliament on Tuesday. The EU and US have responded with targeted sanctions, freezing assets of several high-ranking Russian officials. Additional sanctions are expected, possibly as early as this week.

In the US, concern about the job market eased after a solid Unemployment Claims release late last week. The key indicator dropped to 315 thousand, down from 323 thousand the previous week. This beat the estimate of 334 thousand. This was the second straight drop for the key employment indicator. Core Retail Sales and Retail Sales both posted gains of 0.3%, which were within market expectations. These indicators are the primary gauges of consumer spending, and although the gains were modest, they mark an improvement over the January readings.

USD/CAD for Tuesday, March 18, 2014

Forex Rate Graph 21/1/13

USD/CAD March 18 at 15:45 GMT

USD/CAD 1.1072 H: 1.1075 L: 1.1026

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.0852 1.0906 1.1000 1.1094 1.1177 1.1319

  • USD/CAD has edged higher in Tuesday trade. The pair has touched a high of 1.1075 in the North American session.
  • The key level of 1.10 is providing support. Next is support at 1.0906, protecting the 1.09 level.
  • 1.1094 continues to provide resistance. It is a weak line and could be tested during the day. This is followed by strong resistance at 1.1177.
  • Current range: 1.10 to 1.1094

Further levels in both directions:

  • Below: 1.1000, 1.0906, 1.0852 and 1.0783
  • Above: 1.1094, 1.1177, 1.1319, 1.1496 and 1.1639

OANDA's Open Positions Ratio

USD/CAD ratio is pointing to gains in long positions on Tuesday, continuing the trend we saw a day earlier. This is consistent with what we are seeing from the pair, as the US dollar has edged higher. The ratio has a majority of short positions, indicating trader bias towards the loonie showing improvement.

USD/CAD is trading in the mid-1.10 range. The pair is moving higher in the North American session and we could see a move towards the 1.11 level during the day, as the Canadian dollar finds itself under pressure.

USD/CAD Fundamentals

  • 12:30 Canadian Manufacturing Sales. Estimate 1.1%. Actual 1.5%.
  • 12:30 US Building Permits. Estimate 0.97M. Actual 1.02M.
  • 12:30 US Core CPI. Estimate 0.1%. Actual 0.1%.
  • 12:30 US CPI. Estimate 0.1%. Actual 0.1%.
  • 12:30 US Housing Starts. Estimate 0.92M. Actual 0.91M.
  • 13:00 US TIC Long-Term Purchases. Estimate 23.4B. Actual 7.3B.
  • 15:55 BOC Governor Stephen Poloz Speaks.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Source: USD/CAD - Little Movement As Canadian Manufacturing Sales Shines