Canadian Dollar: USD/CAD (CAD=X) Canada to release Manufacturing Sales for November
USD/CAD has posted small gains in the Monday session. Currently, the pair is trading at 1.3298, up 0.23% on the day. There are no U.S. or Canadian events on the schedule, so traders can expect limited movement from the pair during the day. On Tuesday, Canada releases Manufacturing Sales for November, which has posted two declines in the past three months.
The Chinese economy continues to show signs of an economic slowdown. The world’s second largest economy continues to expand, but a downward trend has made investors nervous. On Monday, China reported that GDP had slowed to 6.6% in 2018, marking its lowest level since 1990. GDP for the fourth quarter dipped to 6.4%, compared to 6.5% in the previous quarter. The soft GDP release comes on the heels of soft trade and manufacturing data, pointing to a slowdown due to the ongoing U.S-China trade war.
The Trump administration has threatened further tariffs if a deal is not reached by March 1, but a second round of negotiations between the sides is scheduled for the end of the month in Washington. Chinese officials will be under pressure to show more flexibility in the talks, in order to stem the economic bleeding. Investor risk appetite has been strong in January, and that has been a major boost for the Canadian dollar, which has improved 2.5% this month and erased the December losses. However, if China continues to post soft data, investor confidence could nosedive and push the Canadian dollar lower.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.34.
The projected lower bound is: 1.31.
The projected closing price is: 1.33.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 27 white candles and 22 black candles for a net of 5 white candles.
An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend (which appears to be the case with FOREX CAD=). It then signifies that the momentum may be shifting from the bears to the bulls.
If the engulfing bullish pattern occurs during an uptrend, it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 61.3295. This is not an overbought or oversold reading. The last signal was a buy 5 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 43.91. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 13 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -26. This is not a topping or bottoming area. The last signal was a buy 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 13 period(s) ago.
Rex Takasugi – TD Profile
FOREX CAD= closed up 0.004 at 1.329. Volume was 19% above average (neutral) and Bollinger Bands were 89% wider than normal.
Open High Low Close Volume___
1.325 1.332 1.325 1.329 101,933
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.33 1.34 1.31
Volatility: 4 7 8
Volume: 90,069 84,515 86,489
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX CAD= is currently 1.5% above its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of CAD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on CAD= and have had this outlook for the last 9 periods.