Analysis and Recommendations (USD/CAD Forecast for 19 May):
The USD/CAD gained 32 points to trade at 1.2046 as the greenback recovered in a quiet session. The US dollar traded in the green on Monday with Canadian markets closed for a local holiday the CAD is pretty much sitting tight. Data from the Commodity Futures Trading Commission released on Friday showed speculators further pared back their bullish dollar bets in the week ended May 12, pushing net long positions down for the seventh straight week to their lowest in nine months.
When the Bank of Canada cut its key interest rate in January, it said it was taking out insurance against the potential impact of lower oil prices on Canada’s economy.
It may have to take out some additional coverage in the coming weeks, if recent market trends toward a stronger Canadian dollar and higher bond yields persist. That’s because those trends could choke off the easier money the central bank was trying to encourage when it cut its policy interest rate by 0.25% to 0.75% on Jan. 21.
The Canadian dollar has recovered all the ground it lost after the rate cut.
Against a basket of six major currencies, the dollar added about 0.3 percent to 93.230, after posting its fifth straight weekly decline. It had reached 92.133 on Thursday.
The US dollar has staged a strong rally against the Canadian dollar ahead of the weekend; USD-CAD has risen nearly half a percent to reach 1.2063. These gains are however unlikely to convince leading currency analysts that we are witnessing a turn-around in fortunes for the USD.
The dollar is under pressure right across the board with the multi-month rally stalling and reversing. This has allowed the Canadian dollar to push the USD-CAD lower from 1.2817 in March down to 1.1919 in May.
ForexTraq provides in-depth analysis for each currency and commodity we review in forex trading. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information for USD/CAD in our weekly reports.
Today’s economic releases actual vs. forecast:
|AUD||RBA Assist Gov Lowe Speaks|
|JPY||Industrial Production (MoM)||-0.8%||-0.3%||-0.3%|
|JPY||Tertiary Industry Activity Index||-1.0%||-0.5%||0.4%|
|CHF||Retail Sales (YoY) (Mar)||-2.8%||-2.0%||-3.1%|
Upcoming Economic Events that you should be monitoring for USD/CAD in forex trading:
Tuesday, May 19, 2015
|AUD||Monetary Policy Minutes|
|GBP||CPI (YoY) (Apr)|
|EUR||German ZEW Economic||49.0||53.3|
|EUR||CPI (YoY) (Apr)||0.0%||0.0%|
|USD||Building Permits (Apr)||1.065M||1.042M|
|CAD||BoC Gov Poloz Speaks|
Government Bond Auctions
Date Time Country
May 20 09:03 Sweden Holds bond auction
May 21 08:30 Spain Auctions Bonos
May 21 09:03 Sweden Holds bond exchange auction
May 21 09:10 France Auctions BTANs
May 21 09:30 UK Auctions 4.75% 2030 Conventional Gilt
May 21 10:10 France Auctions
May 21 15:30 Italy Announces details of CTZ/BTPei on 26 May
May 21 15:00 US Announces details of 2-year FRN on 27 May, plus 2/5/7 year
May 21 17:00 US Auctions 10-year TIPs
May 22 09:03 Sweden Holds bond exchange auction
May 22 10:00 Norway Details bond auction on 27 May
USD/CAD technical analysis forecast
REGISTER WITH OUR FORUM AND POST AT LEAST ONE MESSAGE TO GET FREE SIGNALS