Forex Market: USD/CAD daily trading outlook

Yesterday’s trade saw USD/CAD within the range of 1.1466-1.1367. The pair closed at 1.1385, losing 0.21% on a daily basis.

At 9:47 GMT today USD/CAD was up 0.12% for the day to trade at 1.1400. The pair held in a daily range of 1.1380-1.1414.

Fundamental view

United States

The Labor Department is expected to report at 13:30 GMT that the number of Americans who filed for initial unemployment benefits in the week ended November 1st stood at 285 000, down 2 000 from the preceding period.

Initial jobless claims number is a short-term indicator, reflecting lay-offs in the country. In case the number of claims increased more than projected, this would have a bearish effect on the greenback.

The number of continuing jobless claims probably slid to 2.360 million from 2.384 million during the previous period.

Nonfarm productivity probably rose by 1.5% in the third quarter on a quarterly basis, a preliminary reading is expected to show, compared to a 2.3% gain during the previous three months. Unit labor costs are expected to have marked a 0.5% gain on the same basis, following a 0.1% contraction in the second quarter.

Canada

The number of building permits in Canada probably rose by 5.2% on a monthly basis in September, according to the median estimate by experts. In August, permits, issued by the government, contracted by 27.3%.

Building permits, as an indicator, provide information regarding demand in Canada’s housing market. In case the number of permits rises more than anticipated, this should have a bullish effect on the Canadian dollar. Statistics Canada is to release its monthly report at 13:30 GMT.

Activity among purchasing managers in Canada probably increased in October, albeit at a slower pace from a month earlier, with the corresponding Ivey PMI expected to come in at a seasonally adjusted value of 57.0. In September the index stood at 58.6. If confirmed, this would be the fourth straight month of growth.

This indicator is based on a survey sponsored by Richard Ivey School of Business and Canadian Purchasing Management Association. It encompasses 175 respondents in both the public and private sectors, selected in accordance with their geographic location and activity, so that the entire economy is covered. Activity among purchasing managers is closely watched by market players, as managers have an early access to data regarding performance of their companies, which could be used as a leading indicator of overall economic activity. Readings above the key level of 50.0 are indicative of expansion in activity. Higher than expected readings of the PMI would bolster demand for the loonie. The official result is due out at 15:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.1406. In case USD/CAD manages to breach the first resistance level at 1.1445, it may come to test 1.1505. In case the second key resistance is broken, the pair will probably attempt to advance to 1.1544.

If USD/CAD manages to breach the first key support at 1.1346, it will probably continue to slide and test 1.1307. With this second key support broken, movement to the downside will probably continue to 1.1247.

The mid-Pivot levels for today are as follows: M1 – 1.1277, M2 – 1.1327, M3 – 1.1376, M4 – 1.1426, M5 – 1.1475, M6 – 1.1525.

In weekly terms, the central pivot point is at 1.1239. The three key resistance levels are as follows: R1 – 1.1361, R2 – 1.1455, R3 – 1.1577. The three key support levels are: S1 – 1.1145, S2 – 1.1023, S3 – 1.0929.