The Canadian dollar has posted losses in the Friday session, following the trend seen on Thursday. Currently, USD/CAD is trading at 1.3195, up 0.31% on the day. The pair is trading at its highest level since early September. There are no Canadian events on the schedule. In the U.S., PPI and Core PPI are both expected to post gains of 0.2% for October, unchanged from the September readings. As well, UoM Consumer Sentiment is forecast to slow to 98.0 points.

After the intense excitement surrounding the U.S. mid-term elections, the Federal Reserve meeting paled in comparison. The markets were not expecting much drama, as it was not really a “live meeting” – there was virtually no chance of a rate hike and no press conference from Fed chair Jerome Powell. Fed policymakers continued to sound hawkish in the rate statement, in a similar vein to the previous statement in September. Fed policymakers noted that job creation is solid, unemployment is down and consumer spending has been growing. The one caveat to this rosy picture was that business investment has slowed. The statement added that further “gradual increases” are expected, given that headline and core inflation are close to the Fed target of 2 percent. The Fed next convenes in mid-December, with the CME Group pegging the odds of a December rate hike at a strong 76 percent.

A red-hot U.S economy has helped boost the Canadian economy, which continues to perform well. This was underscored on Thursday by a superb reading from Ivey PMI, a key gauge of economic activity. The indicator surged to 61.8 in November, up sharply from 50.4 in October. This reading easily beat the estimate of 50.9 points. Earlier this week, Bank of Canada Governor Stephen Poloz said that the Bank would continue gradually raising rates from the current 1.75% to a “neutral stance” of between 2.5% and 3.5%. The magic question for investors is how quickly the BoC will move in this direction. The BoC has raised rates some five times in the past 15 months, and upcoming rate hikes will help make the Canadian dollar an attractive option for investors.

European Open – Stocks lower on hawkish Fed

USD/JPY retreats from five-week high

The Fed affect

 

USD/CAD Fundamentals

  • 8:30 US PPI. Estimate 0.2%

  • 8:30 US Core PPI. Estimate 0.2%

  • 9:05 US FOMC Member Randal Quarles Speaks

  • 10:00 US Preliminary UoM Consumer Sentiment. Estimate 98.0

  • 10:00 US Preliminary UoM Inflation Expectations

USDCAD

Open: 1.3154 High: 1.3198 Low: 1.3141 Close: 1.3195

 

USD/CAD Technical

S3

S2

S1

R1

R2

R3

1.2831

12970

1.3099

1.3198

1.3292

1.3383


USD/CAD ticked higher in the Asian session and the trend has continued in European trade

  • 1.3099 is providing support

  • 1.3198 has switched to a resistance role following gains by USD/CAD on Friday. It remains a weak line

  • Current range: 1.3099 to 1.3198

Further levels in both directions:

  • Below: 1.3099, 1.2970, 1.2831 and 1.2733

  • Above: 1.3198, 1.3292 and 1.3383

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 OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD struggles below 1.1100 amid stimulus concerns

EUR/USD remains on the back foot below 1.1100 as investors fear that Germany's potential stimulus package will be insufficient. Tension is mounting toward Powell's critical speech on Friday.

EUR/USD News

GBP/USD struggles with 1.2100 amid growing Brexit uncertainty

GBP/USD is trading close to 1.2100, down. UK PM Johnson's request to abandon the Irish backstop in the Brexit accord was rebuffed by the EU ahead of top-level meetings.

GBP/USD News

USD/JPY retraces from 3-day top as risk-on takes a breather

The Asian traders look for further details to extend the USD/JPY pair’s previous run-up as a pullback emerges on the chart around 106.60 heading into Tuesday’s European session.

USD/JPY News

Top 3 Price Prediction Bitcoin, Ripple, Ethereum: Planning the next bullish move after consolidating gains

Trading cryptos is not a one-way street – meteoric unstoppable gains belong to the past. Nevertheless, the bullish sentiment seems to prevail. Digital coins advanced on Monday and are consolidating on Tuesday. 

Read more

Gold: Bearish outside bar reversal favors drop to $1,480

Gold closed well below $1,504 on Monday, validating the bearish outside bar candlestick pattern created on Friday. A bearish outside bar candle occurs when the price action for a specific day falls outside the high and low of the preceding day.

Gold News

Majors

Cryptocurrencies

Signatures