USDCAD Technical Analysis 2016, 20.11 - 27.11: ranging bullish with 1.3551 resistance for 1.3588 re-enter target

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Sergey Golubev, 2016.11.18 10:48

Trading News Events: Canada Consumer Price Index (adapted from dailyfx)

• "Another uptick in Canada’s Consumer Price Index (CPI) along with stickiness in the core rate of inflation may foster a larger pullback in USD/CAD as the Bank of Canada (BoC) ‘expects total CPI inflation to be close to 2 percent from early 2017 onwards.’"
• "Even though the BoC ‘actively’ discussed more stimulus for the real economy, it seems as though Governor Stephen Poloz and Co. will continue to endorse a wait-and-see approach for monetary policy as ‘Canada’s economy is still expected to grow at a rate above potential starting in the second half of 2016.’ The risk of overshooting the 2% target for inflation may push the BoC to gradually move away from its easing-cycle, but signs of subdued price growth may encourage the central bank to further support the real economy as the region is anticipated to return to ‘full capacity around mid-2018, materially later than the Bank had anticipated in July.’"

Bullish CAD Trade: Canada CPI Picks Up for Second Consecutive Month

• "Need to see red, five-minute candle following the release to consider a short trade on USD/CAD."
• "If market reaction favors a long loonie trade, sell USD/CAD with two separate position."
• "Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward."
• "Move stop to entry on remaining position once initial target is hit; set reasonable limit."

• "Need green, five-minute candle to favor a long USD/CAD trade."
• "Implement same setup as the bullish Canadian dollar trade, just in the opposite direction."

Daily price is on bullish ranging condition for 1.3551 resistance level to be broken on close daily bar for the daily bullish trend to be resumed. Alternative, if the price breaks 1.3399 support level to below on close bar so the local downtrend as the secondary correction within the primary bullish trend will be started.

• If the price will break 1.3551 resistance level on close daily bar so the primary bullish trend will be resumed.
  
• If price will break 1.3399 support on close daily bar so the local downtrend as the secondary correction within the primary bullish trend will be started.
  
• If not so the price will be ranging within the levels.

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USD/CAD M5: 24 pips range price movement by Canada Consumer Price Index news events

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Sergey Golubev, 2016.11.19 07:40

Weekly Outlook: 2016, November 20 - November 27 (based on the article)

The US dollar continued marching forward, accompanied by clear hints of a rate hike. US Durable Goods Orders, UK GDP and the all-important FOMC Meeting Minutes stand out in the week of Thanksgiving. These are the major events on forex calendar.

1. Mario Draghi speaks: Monday, 16:00. ECB President Mario Draghi will testify before the European Parliament, in Strasbourg.
2. US Durable Goods Orders: Wednesday, 13:30. Economists expect durable goods to rise 1.2% in September, while core goods to rise 0.2%.
3. US Unemployment Claims: Wednesday, 13:30. The number of jobless claims is expected to reach 241,000 this time.
4. US Crude Oil Inventories: Wednesday, 15:30.
5. US FOMC Meeting Minutes: Wednesday, 19:00. These are the minutes from the November meeting, in which the Fed left rates unchanged but argued that the case for raising rates has “continued to strengthen”.
6. German Ifo Business Climate: Thursday, 9:00. German business climate is expected to register 110.6 in November.
7. UK GDP data: Friday, 9:30. The second estimate is expected to confirm the first one, but changes are not uncommon.

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Sergey Golubev, 2016.11.19 11:12

Dollar Index - "While the bearings on sentiment and the Dollar’s role in the spectrum can be debated, there is little doubt that rate speculation has been a straight forward contribution to its performance. Expectations of a rate hike before the end of the year has climbed steadily and now stands at 100 percent according to Fed Fund futures. There is good fundamental evidence to support this through Fed guidance and the evolution of data; but at this degree of expectation, there is little further value to be conferred on the currency. With a hike already priced in, we are not going to see expectations of a faster pace of tightening much less a 50 bps move. Alternatively, if volatility were to rise in the capital markets; a repeat of the summers of 2015 and 2016 where the Fed decided to defer in order to avoid unsettling the markets would be very likely. This does not pose a particularly promising set of scenarios – restrained and difficult bullish continuation against a volatile and easy to spark correction. And, while quiet can offer relief from pain; it can also cool runaway optimism enough to let the troubles show through."

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Sergey Golubev, 2016.11.19 11:36

USD/CAD - "For the week ahead, Canadian data is relatively light as the U.S. goes on holiday on Thursday for Thanksgiving. Wholesale Sales are released on Monday, and Retail Sales on Tuesday in which a contraction of -.1% is expected. Perhaps more interesting in the immediate-future is how the Canadian Dollar responds to long-term support values (resistance on USD/CAD). The 1.3450-1.3550 zone has been a critical level in USD/CAD for a long time, providing a strong element of support in the mid-1990’s and, more recently as resistance in September of 2015 and then again over the past three weeks."

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Sergey Golubev, 2016.11.22 09:32

Trading News Events: Canada Retail Sales (adapted from dailyfx)

• "A 0.6% rebound in Canada Retail Sales may spark a bullish reaction in the loonie and lead to a near-term pullback in USD/CAD should the data print highlight an improved outlook for growth and inflation."
• "Even though the Bank of Canada (BoC) keeps the door open to further embark on its easing-cycle, a marked pickup in household spending may encourage Governor Stephen Poloz and Co. to retain the current policy at the last 2016-meeting on December 7 as ‘Canada’s economy is still expected to grow at a rate above potential starting in the second half of 2016, supported by accommodative monetary and financial conditions and federal fiscal measures.’ Nevertheless, another disappointing sales report may push the BoC to ‘actively’ discuss additional measures in 2017 as the region is expected to return to full-capacity ‘materially later than the Bank had anticipated in July.’"

Bullish CAD Trade: Retail Spending Rebounds 0.6% or Greater

• "Need to see red, five-minute candle following the release to consider a short trade on USD/CAD."
• "If market reaction favors a long loonie trade, short USD/CAD with two separate position."
• "Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward."
• "Move stop to entry on remaining position once initial target is hit; set reasonable limit."

Bearish CAD Trade: Canada Household Spending Disappoints

• "Need green, five-minute candle to favor a long USD/CAD trade."
• "Implement same setup as the bullish Canadian dollar trade, just in reverse." 

Daily price is on bullish are of the chart located to be above Ichimoku cloud. The price is on secondary correction to be started on open daily bar by 1.3386 support level to be broken for the correction to be continuing.

• If the price will break 1.3588 resistance level on close daily bar so the primary bullish trend will be resumed.
  
• If price will break 1.3386 support on close daily bar so the local downtrend as the secondary correction within the primary bullish trend will be started.
  
• If not so the price will be ranging within the levels.

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Sergey Golubev, 2016.11.23 11:37

Trading News Events: U.S. Durable Goods Orders (adapted from dailyfx)

• "A 1.7% rebound in U.S. Durable Goods Orders may heighten the appeal of the greenback and spark a near-term decline in EUR/USD as it puts increased pressure on the Federal Open Market Committee (FOMC) to raise the benchmark interest rate at the last 2016-meeting on December 14."
• "Fed Funds Futures are pricing a greater than 90% probability for a December rate-hike as ‘the Committee judges that the case for an increase in the federal funds rate has continued to strengthen,’ and Chair Janet Yellen and Co. may continue to normalize monetary policy in the year ahead should the data print reinforce central bank expectations for a ‘moderate’ recovery. However, another unexpected decline in demand for large-ticket items may drag on interest-rate expectations as private-sector consumption remains one of the leading drivers of growth and inflation."

Bullish USD Trade: Demand for Large-Ticket Items Rebound 1.7% or Greater

• "Need red, five-minute candle following the report to consider a short EUR/USD trade."
• "If market reaction favors a bullish dollar trade, short EUR/USD with two separate position."
• "Set stop at the near-by swing high/reasonable distance from cost; at least 1:1 risk-to-reward."
• "Move stop to entry on remaining position once initial target is met, set reasonable limit."

Bearish USD Trade: U.S. Durable Goods Orders Report Disappoints

• "Need green, five-minute candle to favor a long EUR/USD trade."
• "Implement same strategy as the bullish dollar trade, just in the opposite direction." 

Daily price is on located below Ichimoku cloud in the primary bearish area of the chart. The price is trying to test 1.0568 support level to below for the bearish trend to be continuing.

• If the price will break 1.0759 resistance level on close daily bar so the local uptrend as the bear market rally will be started.
  
• If price will break 1.0568 support on close daily bar so the primary bearish trend will be resumed.
  
• If not so the price will be ranging within the levels.

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