CAD: The Canadian Dollar ( Loonie ) is trading flat ahead of today’s economic data with core CPI and Core retail sales getting announced at 1430 European time. The consumer price index is forecasted to show a monthly loss of 0.1 percent but still on track to a yearly 2.8 percent pace. Retails sales are anticipated to show a more robust economy with a jump of 0.6 percent. The data will put an October rate hike by the Bank of Canada (BoC) firmly on the table if it beats expectations.
Yesterday NAFTA negotiations restarted with President Trump accused OPEC of not doing enough to keep commodity prices down. NAFTA talks continue today between the US and Canada with both sides remain optimistic but an agreement does not seem to be in the cards in the short term.
The USD/CAD pair tells the trader how many Canadian dollars (the quote currency) are needed to purchase one U.S. dollar (the base currency). This currency pair is also known as the “Loonie”, a nickname derived from the picture of a loon, a distinctive bird which appears on one side of the Canada’s gold-colored, one Dollar coin.
Bank of Canada (BoC, Canada’s Central bank) that issues statements and decides on the interest rates of the country. Its president is Stephen Poloz. Canadian Government (headed by Justin Trudeau) and its Department of Finance (whose minister is Bill Morneau) that implement policies that affect the economy of the country.
CAPP (Canadian Association of Petroleum Producers): Canada being a prominent oil and natural gas producer, the trade organization of that industry is very important.
Loonie has been bearish for the past 2 weeks and it doesn’t look to be getting any better after breaking a major support level and is currently sitting on the weekly level. With the Nafta negotiations back on the roundtable things will get moving.
Technical Levels to watch today:
Short: If the support level of 1.28900 is breached the loonie could collapse to the 1.27500 Monthly support level.
Long: If negotiations go well and the data is bad we could see a push to the upside t the 1.29760 level
GBPCAD Daily Outlook
GBPCAD printed a double top over the past few weeks however after Brexit’s negotiations meeting this week and good Cable data the pair rallied from support of the neckline to near resistance. This has turned this into a sideways pattern and depending on news today we will either see a push back down to support and continuing the sideway’s pattern or it will break resistance.
Short: Support level is 1.69590 and if this is breached the bearish trend will continue and our short target will be 1.68500
Long: Resistance level is 1.717900 and if this is breached and a good daily candle close we could see a rally to 1.73200
EURCAD Daily Outlook
EUR has German manufacturing data release this morning but otherwise it a quiet morning for the pair until CAD data this afternoon. Brexit talks have been pushing the EUR higher against the Canadian dollar and the pair is currently trading at the resistance level of the bear channel.
Short: If the pairs fail’s to break resistance and a bearish signal is formed there are 3 targets listed on the 1 HR chart.
Long: If resistance is broken the long target would be 1.52600
The Bank of England
The Bank of England is the central bank of the United Kingdom. It was established in 1694 and was privately owned in the beginning, the Bank was nationalized in 1946 so now is completely owned by the UK government. BOE’s main reason to be is to maintain monetary and financial stability in the country. Some of its other tasks are producing secure bank notes, operating asset purchase facility and keeping the inflation low and stable.BOE Official Website, on Twitter and Facebook
The European Central Bank (ECB)
The European Central Bank (ECB) is the central bank empowered to manage monetary policy for the Eurozone and maintain price stability so that the euro’s purchasing power is not eroded by inflation. The ECB aims to ensure that the year-on-year increase in consumer prices is less than, but close to 2% over the medium term. Another of its tasks is the one of controlling the money supply. The European Central Bank’s work is organized via the following decision-making bodies: the Executive Board, the Governing Council, and the General Council. Mario Draghi, a member of the Executive Board, is also the President of this organism.
The Federal Reserve Bank (Fed)
The Federal Reserve System (Fed) which is the central banking system of the United States. Fed has two main targets: to keep unemployment rate to their lowest possible levels and inflation around 2%. The Federal Reserve System’s structure is composed of the presidentially appointed Board of Governors, partially presidentially appointed Federal Open Market Committee (FOMC). The FOMC organizes 8 meetings in a year and reviews economic and financial conditions. Also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth.