Friday’s trade saw USD/CAD within the range of 1.2969-1.3147. The pair closed at 1.3011, edging up 0.16% on a daily basis. It has been the 34th gain in the past 64 trading days. The daily high has been the highest level since March 29th, when a high of 1.3217 was registered. In weekly terms, USD/CAD fell 1.99% during the past week. It has been the 10th drop in the past 13 weeks and also the sharpest one since the week ended on January 24th. USD/CAD plunged 4.06% in March, or the most since April 2015, while extending the drop recorded in February.
At 7:16 GMT today USD/CAD was edging up 0.21% on the day to trade at 1.3067. The pair touched a daily high at 1.3070 at 6:40 GMT, overshooting the range resistance level (R3), and a daily low at 1.3022 during the early phase of the Asian trading session.
Meanwhile, crude oil futures renewed their retreat on April 1st. Friday marked the 37th drop in oil prices out of the past 75 trading days. Oil futures for May delivery went down as low as $36.63 per barrel on April 1st, or the lowest level since March 16th, and closed at $36.79, plummeting 4.04% on the day. As of 7:28 GMT today the commodity was edging down 0.11% to trade at $36.35, after going down as low as $36.19 per barrel earlier.
On Monday USD/CAD trading may be influenced by the following macroeconomic reports as listed below.
Fundamentals
United States
Factory Orders
Factory orders in the United States probably shrank 1.6% in February compared to January, according to the median estimate by experts, following a 1.6% expansion in the preceding month. Januarys increase has been the fastest since June 2015, when a revised up 2.2% gain was reported. Excluding the sector of transportation, factory orders went down 0.2% in January from a month ago. This indicator reflects the total value of new purchase orders, placed at manufacturers for durable and non-durable goods, and can provide insight into inflation and growth in the US sector of manufacturing. In case the general index of new orders dropped at a faster-than-anticipated rate, this would have a moderate bearish effect on the US dollar, as it implies future growth slowdown. The US Census Bureau will release the official data at 14:00 GMT.
Canada
Bank of Canadas Business Outlook Survey
At 14:30 GMT Bank of Canada will release the results from its Business Outlook Survey. The latter represents a summary of interviews conducted by the bank’s regional offices with the senior management of about 100 business entities, selected in accordance with the composition of nation’s Gross Domestic Product. The major goal is to reflect the perspectives of these businesses on topics of key interest to the Bank of Canada, including demand and capacity pressures, as well as companies’ forward-looking views on economic activity. The survey encompasses opinions expressed by the respondents, which do not necessarily come in consonance with the Bank’s view or policy.
Correlation with other Majors
Taking into account the week ended on April 1st and the daily closing levels of the major currency pairs, we come to the following conclusions in regard to the strength of relationship:
USD/CAD to USD/CHF (0.8426, or very strong)
USD/CAD to USD/JPY (0.8044, or very strong)
USD/CAD to GBP/USD (-0.3949, or moderate)
USD/CAD to EUR/USD (-0.9206, or very strong)
USD/CAD to AUD/USD (-0.9548, or very strong)
USD/CAD to NZD/USD (-0.9829, or very strong)
1. During the examined period USD/CAD moved almost equally in one and the same direction with USD/JPY and USD/CHF.
2. USD/CAD moved almost equally in the opposite direction compared to EUR/USD, AUD/USD and NZD/USD during the past week. This relationship has been the most pronounced between USD/CAD and NZD/USD, with the correlation between these two major pairs being almost perfect.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for USD/CAD are presented as follows:
R1 – 1.3027
R2 – 1.3044
R3 (range resistance) – 1.3060
R4 (range breakout) – 1.3109
S1 – 1.2995
S2 – 1.2978
S3 (range support) – 1.2962
S4 (range breakout) – 1.2913
By using the traditional method of calculation, the weekly pivot levels for USD/CAD are presented as follows:
Central Pivot Point – 1.3051
R1 – 1.3245
R2 – 1.3478
R3 – 1.3672
S1 – 1.2818
S2 – 1.2624
S3 – 1.2391
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