USD/CAD: Canadian Dollar Steady
Kenny Fisher | May 01, 2018 09:04
The Canadian dollar continues to trade quietly. In the Tuesday session, USD/CAD is trading at 1.2869, up 0.20% on the day. On the release front, Canada releases GDP, which is expected to rebound with a gain of 0.3%. Later in the day, Bank of Canada Governor Stephen Poloz will speak about household debt an event in Yellowknife. In the U.S., today’s key event is ISM Manufacturing PMI, which is expected to drop to 58.4 points. The focus will shift to U.S. employment indicators in the latter part of the week, starting with ADP Nonfarm Employment Change on Wednesday. As well, the Federal Reserve will release a rate statement.
U.S. President Donald Trump has extended exemptions for steel and aluminum tariffs for Canada and Mexico for another 30 days. The exemptions come at a sensitive time, with the U.S., Canada and Mexico neck deep in negotiations over a new NAFTA trade agreement. The talks have made significant progress, but the critical auto pact remains a stumbling block. It is likely that a tentative agreement will be hammered out, perhaps later this month. The Bank of Canada has dropped strong hints that it plans to raise interest rates later this year, but policymakers would like the NAFTA issue to be resolved before the next rate hike.
The Federal Reserve will be on center stage on Wednesday when it concludes a two-day policy meeting. The markets are expecting the Fed to maintain the benchmark rate at a range between 1.50% and 1.75%, and analysts will be keeping a close eye on the rate statement – a hawkish statement could propel the U.S. dollar to higher levels. There is growing sentiment that the Federal Reserve will raise interest rates four times this year, although Fed policymakers have not changed their forecast of three increases in 2018. One scenario envisions the Fed raising rates once each quarter until the economy shows signs of slowing down. If inflation continues to move higher and economic conditions remain strong, the dollar should continue to perform well against its Canadian counterpart.
USD/CAD Fundamentals
Tuesday (May 1)
- 8:30 Canadian GDP. Estimate 0.3%
- 10:00 US ISM Manufacturing PMI. Estimate 58.6
- 10:00 Construction Spending. Estimate 0.5%
- 10:00 US ISM Manufacturing Prices. Estimate 78.3
- All Day – US Total Vehicle Sales. Estimate 17.1M
- 14:30 Bank of Canada Governor Stephen Poloz Speaks
Wednesday (May 2)
- 8:15 US ADP Nonfarm Employment Change. Estimate 200K
- 14:00 US FOMC Statement
- 14:00 US Federal Funds Rate. Estimate
Get The App
*All release times are DST
*Key events are in bold
USD/CAD for Tuesday, May 1, 2018
USD/CAD, May 1 at 6:35 DST
Open: 1.2843 High: 1.2869 Low: 1.2820 Close: 1.2868
USD/CAD Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1.2687 | 1.2757 | 1.2850 | 1.2943 | 1.3015 | 1.3125 |
USD/CAD edged lower in the Asian session. The pair has reversed directions and has posted gains
- 1.2850 remains fluid and has switched to a resistance role after gains by USD/CAD on Tuesday.
- 1.2943 is the next resistance line
- Current range: 1.2850 to 1.2943
Further levels in both directions:
- Below: 1.2850, 1.2757, 1.2687 and 1.2590
- Above: 1.2943, 1.3015 and 1.3125
OANDA’s Open Positions Ratio
USD/CAD ratio is almost uchanged in the Tuesday session. Currently, short positions have a majority (61%), indicative of slight trader bias towards USD/CAD reversing directions and moving downwards.
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.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.