USD/CAD Forecast December 10-14 – BOC Bearish But Jobs Beat, Can CAD Make A Comeback?

Dollar/CAD had another week of setting new highs but it then dropped sharply on the Canadian jobs report. What’s next? While the Canadian calendar is quite sparse, oil prices will likely rock the loonie. Here are the highlights and an updated technical analysis for USD/CAD.

The C$ had a turbulent week. The BOC was dovish by saying that Canada could experience non-inflationary growth. The chances for a rate hike in January are now lower. On the other hand, Canada enjoyed an enormous gain of 94.1K jobs in November, most of them full-time ones. Oil prices went up and down with every twist in the news related to OPEC. The eventual decision by OPEC and non-OPEC countries to curb output helped prices stabilize. The decision by the regional government of Alberta to introduce its own limits also helped push the Western Canadian Select prices higher in comparison to America’s WTI. In the US, the optimistic tone from the Trump-Xi summit helped the loonie, as a risk currency. Misunderstandings about the decisions and the arrest of the CFO of Huawei hurt the atmosphere.

USD/CAD daily chart with support and resistance lines on it. Click to enlarge:

  1. Timothy Lane talks: Monday, 6:30, and at 12:45. The Deputy Governor of the Bank of Canada will speak in Istanbul, Turkey. He will have the opportunity to comment on the excellent jobs report published on Friday, which seems much better than the dovish tone of the BOC decision.
  2. Housing Starts: Monday, 13:15. The housing sector has seen some wobbles in recent months, after years of expansion. The first housing figure of the week is projected to drop from 206K to 198K in the fresh report for November.
  3. Building Permits: Monday, 13:30. Building consents rose by 0.4% in September after three consecutive months of declines. A return to drops is on the cards for October: -0.2% is forecast.
  4. Capacity Utilization Rate: Wednesday, 13:30. This measure of the industry provides the BOC insights on the level of slack in the economy. Utilization has been fluctuating in the mid-80s in recent quarters. After 85.5% in Q2, a small increase to 85.8% is expected for Q3.
  5. NHPI: Thursday, 13:30. The New Home Price Index has not moved much in recent months. It was flat in the past two months and is projected to remain unchanged also in the upcoming report for October.
1 2
View single page >> |

Disclaimer: Foreign exchange (Forex) trading carries a high level of risk and may not be suitable for all investors. The risk grows as the leverage is higher. Investment objectives, risk appetite and ...

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.


Leave a comment to automatically be entered into our contest to win a free Echo Show.
Nam Cung Uyen 10 months ago Member's comment

sell on this article :)

Black Widow 10 months ago Member's comment