How to trade the Canadian Retail Sales with USD/CAD

Selling USD/CAD Scenario

• Tradable Positive Trigger: +0.80 deviation (1.01 %) [SELL Pair]

• Key Support Level: 1.2820

This time, if it comes out at higher than expected with a relative deviation of 0.80 or higher(1.01 or higher in actual terms), the pair may go down reaching a range of 45  pips in the first 15 minutes and 85 pips in the following 4 hours. 

1.2880 was the low point in late August and remains relevant. 1.2820 was a swing low in May and is the next support line. 1.2730 dates back to early May and is the last noteworthy level to watch.

Buying USD/CAD Scenario

• Tradable Negative Trigger: -0.85 deviation (-0.24 %) [BUY Pair]

• Key Resistance Level: 1.2960

If it comes out lower than expected at a relative deviation of -0.85 or less(-0.24 or lower in actual terms), the USDCAD may go up reaching a range of 46 pips in the first 15 minutes and 87 pips in the following 4 hours.

1.2960 provided support to the pair in September and also in July and now switches to resistance. 1.3060 was a high point in mid-September. Further up, 1.3105 was a support line when the pair traded on the high ground earlier in the month.

USD/CAD Levels on the Chart

More data

Retail sales surprised to the upside in June and they are expected to drop in July. The data is important for the BOC's next rate decision.

See: Canadian data preview: Retail sales could be critical as the BOC is keen on hiking

In the last five releases, the USDCAD moved, on average, 15 pips in the 15 minutes after the data release and 34 pips in the following 4 hours. The previous release had a negative surprise of -0.394 in terms of relative deviation and the USDCAD reached a 10 pip range in the first 15 minutes and a range of 23 pips 4 hours thereafter.

Follow the publication of the figure on the economic calendar. Watch out for the data from the Market Impact tool, projecting the potential price changes according to the deviation. Here is the Market Impact Studies Users Guide.