During yesterday’s trading session USD/CAD traded within the range of 1.0894-1.0942 and closed at 1.0916.
At 11:08 GMT today USD/CAD was losing 0.06% for the day to trade at 1.0908. The pair touched a daily low at 1.0905 at 7:15 GMT.
The initial jobless claims in the US probably fell to 310 000 in the week ended May 17, from 297 000 a week ago, according to the median estimate by experts. The indicator measures the number of applications for unemployment benefits that are recorded each week in a report prepared by the Bureau of Labor Statistics in the United States. The data is due out at 12:30 GMT. In case initial jobless claims rose less than expected, this will boost demand for the US dollar.
In addition, at 14:00 GMT the National Association of Realtors (NAR) will report on existing home sales in the United States during April. In March compared to February, existing home sales rose 2.2% to an annualized level of 4.68 million. The sample of data encompasses condos, co-ops and single-family houses.
Statistical data on existing home sales is often used along with statistical figures regarding the New home sales and Pending home sales, with the major objective being to draw a conclusion how nation’s housing sector is performing, regardless of interest rates. The most active house-purchasing period in the United States is usually between the months of March through June. Therefore, in case statistical data revealed a sudden drop in the number of homes sold rather than an improvement during this period, this would be considered as a signal of weakness in country’s housing market.
The report on existing home sales usually does not cause a real direct impact on US economy. Actually, this effect appears to be minimal, due to the fact that nothing is produced with the mere sale of an existing home. In terms of economic activity, the sale of an existing house may be related only to interior design and purchases of new furniture.
In case the index increased more than anticipated, this would support the greenback.
Also at 14:00 GMT the Institute for Supply Management (ISM) is to report on manufacturing activity in the country. According to experts’ estimates, the gauge of manufacturing probably increased to 55.5 in May from 55.4 in the previous month. Values above 50.0 signify increased activity. In case market expectations are exceeded, the US dollar will receive support.
Retail sales in Canada probably rose by 0.3% in March, after a 0.5% increase in the previous month, according to the median analysts’ estimate.
Retail sales are a key monthly indicator of consumer purchases in Canada. In addition, retail sales are an important component of GDP, which measures the overall production of the Canadian economy. The index does not include any form of direct sales, such as sales door-to-door, vending coffee, sale of newspapers or magazines directly from the printing office or publisher sales made through subscription or club cards. Retail sales made over the Internet are included in the study only when held to the same legal scheme. This is the percentage change from the previous month.
Retail sales excluding autos in Canada probably jumped by 0.3% in March, following a 0.6% gain in the previous month, according to the median forecast by experts.
The index presents the changes in the total value of retail sales without the cars, whose sales account for about 20% of the total. They are excluded due to their high volatility, which can significantly affect the overall trend. Data without car sales is considered to be more representative and determines the direction of development of the indicator more precisely. This is the percentage change from the previous month.
Statistics Canada will release official data at 12:30 GMT. Higher-than-expected gains will certainly provide support to loonie’s demand.
According to Binary Tribune’s daily analysis, in case USD/CAD manages to breach the first resistance level at 1.0941, it will probably continue up to test 1.0965. In case the second key resistance is broken, the pair will probably attempt to advance to 1.0989.
If USD/CAD manages to breach the first key support at 1.0893, it will probably continue to slide and test 1.0869. With this second key support broken, the movement to the downside will probably continue to 1.0845.