Canadian Dollar: USD/CAD (CAD=X) release of housing starts and building permits this week
USD/CAD showed limited activity last week and ended the week with slight gains. There are no major Canadian events in the upcoming week. We’ll get a snapshot of the strength of the housing sector, with the release of housing starts and building permits. The U.S. will release consumer inflation as well and the minutes of the Federal Reserve minutes from the March meeting. Here is an outlook for the highlights of this week and an updated technical analysis for USD/CAD.
U.S. numbers started the week poorly, as retail sales and durable goods orders posted declines and missed their forecasts. On Friday, employment data was mixed. Nonfarm payrolls came in at 196 thousand, easily beating the estimate of 172 thousand in March. Still, this reading was significantly lower than the December and January releases, both of which were above the 300-thousand level. Wage growth dipped to 0.1%, shy of the estimate of 0.3%.
In Canada, Ivey PMI surged in March to 54.3, up from 50.6 in the February release. This points to solid expansion. On the employment front, the economy lost 7200 jobs, its first decline in seven months. The unemployment rate remained pegged at 5.8% for a third straight month.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1.33.
The projected upper bound is: 1.35.
The projected lower bound is: 1.32.
The projected closing price is: 1.34.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 27 white candles and 22 black candles for a net of 5 white candles.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
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 49.1686. This is not an overbought or oversold reading. The last signal was a buy 2 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 54.64. 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 67 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 24. This is not a topping or bottoming area. The last signal was a sell 5 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 4 period(s) ago.
Rex Takasugi – TD Profile
FOREX CAD= closed up 0.002 at 1.338. Volume was 13% above average (neutral) and Bollinger Bands were 57% narrower than normal.
Open High Low Close Volume___
1.335 1.340 1.334 1.338 113,883
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.34 1.33 1.32
Volatility: 5 7 7
Volume: 115,725 114,070 92,793
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 1.4% above its 200-period moving average and is in an upward 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 bullish on CAD= and have had this outlook for the last 34 periods.
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