Forex Market: GBP/CAD daily forecast

During yesterday’s trading session GBP/CAD traded within the range of 1.8244-1.8307 and closed at 1.8284.

At 6:42 GMT today GBP/CAD was gaining 0.06% for the day to trade at 1.8294. The pair touched a daily high at 1.8299 at 6:36 GMT.

Fundamental view

United Kingdom

The cost of living in the UK probably rose 1.7% in April from a year ago, according to the median analysts’ estimate. The Consumer Price Index (CPI) is the main measure of inflation in the UK for macroeconomic purposes and forms the basis of the inflation target set by the government. Every month about 120 000 samples are made, examining the change in prices of about 650 products. They represent the “market basket” of goods and services to the index itself. This is the percentage change compared to the same month a year earlier.

In monthly terms, the consumer price index (CPI) probably rose 0.3% last month, following a 0.2% gain in March.

In addition, core consumer prices probably increased 1.8% in April, compared to the same month a year ago, according to the median experts’ forecast. The core CPI, measures the change in prices of goods and services purchased by consumers, as they are taken out volatile components such as food, energy products, alcohol and tobacco. This is the percentage change compared to the same month a year earlier.

The Office for National Statistics will publish the official figures at 08:30 GMT. Better-than-expected readings will provide support to the sterling.

Canada

Wholesale sales in Canada probably rose by 0.4% in March, following a 1.1% gain in the previous month, according to the median analysts’ estimate.

The study measures monthly sales of Canadian wholesalers from each province or region. It provides information about the situation in the wholesale sector and is an important indicator of the state of the Canadian economy. The total value of sales is calculated by deflating the current value in dollars, using the indexes for imports and industrial prices. Since many of the products to wholesalers in the country are subject to import fluctuations of the Canadian dollar, this can have a significant impact on the prices of goods bought and sold by them. This is the percentage change from the previous month.

Statistics Canada is scheduled to publish the official report at 12:30 GMT. A higher than expected gain would certainly heighten the appeal of the loonie.

Technical view

According to Binary Tribune’s daily analysis, in case GBP/CAD manages to breach the first resistance level at 1.8313, it will probably continue up to test 1.8341. In case the second key resistance is broken, the pair will probably attempt to advance to 1.8376.

If GBP/CAD manages to breach the first key support at 1.8250, it will probably continue to slide and test 1.8215. With this second key support broken, the movement to the downside will probably continue to 1.8187.