USD/CAD (CAD=X) slips as trade tensions slam investor risk appetite

USD/CAD (CAD=X) slips as trade tensions slam investor risk appetite

USD/CAD (CAD=X) slips as trade tensions slam investor risk appetite

  • Canadian dollar at C$1.3305, or 75.16 U.S. cents
  • The price of U.S. oil falls 0.7 percent
  • Bond prices higher across a flatter yield curve
  • 10-year yield touches its lowest since March 29 at 2.082 percent

The Canadian dollar weakened against its U.S. counterpart on Monday as rising global trade tensions led to a sell-off in stock markets and as oil prices fell.

At 4 p.m. EDT (2100 GMT), the Canadian dollar CAD was trading 0.3 percent lower at C$1.3305 to the greenback, or 75.16 U.S. cents.

The currency traded in a range between C$1.3270 and C$1.3325. On Friday, it touched its weakest in one year at C$1.3384.

“There is a bit of a risk-off feeling this morning in the market which is pushing the U.S. dollar higher against the Canadian dollar,” said Simon Côté, managing director, risk management solutions at National Bank Financial. “You see the stock market getting hit.”

Wall Street was pummeled by a growing trade dispute between the United States and other leading economies.

Canada exports many commodities and runs a current account deficit so its economy could be hurt if the flow of trade or capital slows.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 1.30.

The projected upper bound is: 1.35.

The projected lower bound is: 1.31.

The projected closing price is: 1.33.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 34 white candles and 15 black candles for a net of 19 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 45.2335. This is not an overbought or oversold reading. The last signal was a sell 1 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 68.73. 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 2 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 71. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 10 period(s) ago.

Rex Takasugi – TD Profile

FOREX CAD= closed down -0.001 at 1.329. Volume was 97% below average (consolidating) and Bollinger Bands were 48% wider than normal.

Open High Low Close Volume___
1.329 1.330 1.328 1.329 2,923

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 1.32 1.29 1.27
Volatility: 8 8 9
Volume: 82,534 88,502 80,908

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.

Summary

FOREX CAD= is currently 4.4% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. 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 8 periods.

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