Yesterday’s trade (in GMT terms) saw USD/CAD within the range of 1.3495-1.3590. The pair closed at 1.3552, inching up 0.04% compared to Fridays close. It has been the 202nd gain in the past 381 trading days and also a fourth consecutive one. The daily high has been a level not seen since February 29th, when a high of 1.3591 was registered. The major pair has extended its advance to 1.07% during the current month, following a 2.14% surge in October.
At 8:31 GMT today USD/CAD was edging down 0.33% on the day to trade at 1.3507. The pair touched a daily high at 1.3565 during early Asian trade, overshooting the daily R1 level, and a daily low at 1.3505 during the early phase of the European trading session.
On Tuesday USD/CAD trading may be influenced by the following macroeconomic reports and other events as listed below.
Fundamentals
United States
Fed speakers
At 12:30 GMT the Fed President for Boston, Eric Rosengren, is to deliver keynote address at the Portland Chamber of Commerce in Portand.
At 18:30 GMT Federal Reserve Vice Chairman, Stanley Fischer, is to speak at the Brookings Institution in Washington, D.C.
Economic outlook or monetary policy-related remarks would heighten USD volatility.
Retail Sales
Retail sales in the United States probably rose for a second straight month in October, according to the median forecast by experts, going up at a monthly rate of 0.6%. In September, sales went up by another 0.6%, or at the fastest monthly rate since June.
Among the 13 major categories, 9 registered growth, 3 registered a decline and 1 recorded no change in September. Sales rose the most at gasoline stations (2.4%), followed by miscellaneous store retailers (1.8%), sporting goods, hobby, book and music stores (1.4%), building material and garden equipment and supplies dealers (1.4%), motor vehicle and parts dealers (1.1%), furniture and home furniture stores (1%), food services and drinking places (0.8%), non-store retailers (0.3%) and food and beverage stores (0.1%).
On the other hand, monthly sales were lower at electronics and appliance stores (-0.9%), health and personal care stores (-0.5%) and general merchandise stores (-0.4%). During the same period, retail sales remained unchanged at clothing and clothing accessories stores.
In annual terms, retail sales increased 2.7% in September, or at the fastest rate since June, following a revised up 2.1% climb in August.
US core retail sales, or retail sales ex autos, probably rose 0.5% in October compared to a month ago, according to market expectations, following a 0.3% increase in September. This indicator removes large ticket prices and historical seasonality of automobile sales.
In case the general index of sales surged at a sharper rate than anticipated in October, this would have a strong bullish effect on the US dollar. The official report by the US Census Bureau is due out at 13:30 GMT.
Import and Export Prices
Prices of imported goods in the United States probably rose 0.4% in October, according to market expectations, following another 0.2% increase in the preceding month. If so, it would be the steepest monthly gain since June. In September, import prices of fuel went up 1.1%, while import prices of non-fuel items remained flat. In annual terms, import prices were 1.1% lower in September, which has been the 26th consecutive month of decline. Generally, lower import prices of goods suggest lower rates of consumer inflation.
Prices of exported goods from the United States probably rose 0.2% in October, according to market expectations, following a 0.3% increase in September. Prices of exported agricultural products plunged 1.0%, extending August’s drop, while prices of exported non-agricultural products went up 0.4% in September, rebounding after a 0.6% decrease in August. In annual terms, export prices slumped 1.5% in September, or for a 25th month in a row. Lower prices of exported goods generally bolster demand abroad, and as US trade accounts for 20% of international trade relations, this also tends to be dollar positive.
The Department of Labor is expected to release the official numbers at 13:30 GMT.
Bond Yield Spread
The yield on Canada’s 2-year government bonds went up as high as 0.680% on November 14th, or the highest level since May 3rd (0.691%), after which it closed at 0.670% to add 4.2 basis points (0.042 percentage point) compared to November 10th.
Meanwhile, the yield on US 2-year government bonds climbed as high as 1.016% on November 14th, or the highest level since January 5th (1.028%), after which it fell to 1.008% at the close to add 8.9 basis points (0.089 percentage point) compared to November 10th.
The spread between 2-year US and 2-year Canadian bond yields, which reflects the flow of funds in a short term, widened to 0.338% on November 14th from 0.291% on November 10th. The November 14th yield spread has been the largest one since March 16th, when the difference was 0.339%.
Daily, Weekly and Monthly Pivot Levels
By employing the Camarilla calculation method, the daily levels of importance for USD/CAD are presented as follows:
R1 – 1.3561
R2 – 1.3569
R3 (Range Resistance – Sell) – 1.3578
R4 (Long Breakout) – 1.3604
R5 (Breakout Target 1) – 1.3635
R6 (Breakout Target 2) – 1.3647
S1 – 1.3543
S2 – 1.3535
S3 (Range Support – Buy) – 1.3526
S4 (Short Breakout) – 1.3500
S5 (Breakout Target 1) – 1.3469
S6 (Breakout Target 2) – 1.3457
By using the traditional method of calculation, the weekly levels of importance for USD/CAD are presented as follows:
Central Pivot Point – 1.3453
R1 – 1.3643
R2 – 1.3739
R3 – 1.3929
R4 – 1.4118
S1 – 1.3357
S2 – 1.3167
S3 – 1.3071
S4 – 1.2974
In monthly terms, for USD/CAD we have the following pivots:
Central Pivot Point – 1.3283
R1 – 1.3560
R2 – 1.3711
R3 – 1.3988
R4 – 1.4265
S1 – 1.3132
S2 – 1.2855
S3 – 1.2704
S4 – 1.2553
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