the daily chartist

USD/CAD recap for 18.09.2015

published 4 years ago
USD/CAD Daily

USD/CAD opened yesterday at 1.31786 made a high to 1.32293 a low to 1.30116 and closed at 1.23154. From its opening price at first seemed that it will be a very "red" day for the pair going 111 pips down to the level as noted from recent posts at 1.30596 and from there - 154 pips up as the cad started depreciating against the dollar. Mentioning in the post about Oil we had Canada inflation core cpi and cpi coming and core cpi came at 0.2% flat /0.2%/0.0% and cpi also flat at 0.0%/0.0%/0.1%. 

 Disappointing and leads to the conclusion that with the continuation of falling oil prices and no change in the inflation, dollar will advance further against the canadian dollar. The price stopped at the lower past resistance line from the narrow daily channel and I think that the price will get back inside it very soon and we may see another run for 1.32983. If conditions stay the same - 1.33686 and 1.34211. 

 Could we see anther BOC cut? The effect from the surge in housing market continues to underpin consumer demand. Housing price gains have averaged nearly 2.0% a year over the past five years, helping insulate Canada to some degrees from the wobbles in the oil market. What's more, housing price gains have outstripped monthly GDP over the past few months, suggesting buoyant domestic demand. Even so, I don't think that the solid consumption growth will be strong enough to offset the slowdown investment as oil prices will remain low for a long time. I think that the BOC will be forced to ease again to help move along the economic rebalancing in an effort to boost manufacturing. This supports the argument towards continuing to buy USD/CAD.