Market Research and Analysis

Daily Market Analysis Report

Wed, 17 May 2017 05:32 AM GMT

Author: Senior Forex Analyst, Arslan Ali Butt

  • Daily Trading Range:
  • 1.3750– 1.3550
  • Support & Resistance Levels:
  • R3: 1.3855
    R2: 1.369
    R1: 1.3592
    Pivot Point: 1.3427
    S1: 1.3329
    S2: 1.3164
    S3: 1.3066
  • Trading Recommendation:
  • Still Active
  • Buy Above 1.3600
    Take Profit:
    1st @ 1.3655
    Stop Loss @ 1.3575

USDCAD

USD/CAD turned lower yesterday on Tuesday due to weaker U.S dollar. The pair is seen attempting to break below support at 1.3588 which had previously held the exchange rate lower in November and December. The US dollar index (DXY) fell below previous week’s low at the European session open and after a period of consolidation, extended lower to trade at a six-month low. DXY had reversed last week after retesting a broken rising trendline that originates from lows posted in May and is on track to post a third consecutive day of losses.

17 May CAD
Fundamental Overview

Unexpected declines in U.S. new-home construction and building permits in April indicate the market is off to a weak start this quarter, government data showed Tuesday. Highlights of Housing Starts (April). Residential starts fell 2.6% to 1.17 mln annualized rate (forecast was 1.26 mln), lowest since November, following revised 1.2 mln pace in the prior month. Permits decreased 2.5% to 1.23 mln annualized pace (forecast was 1.27 million) from 1.26 mln. The decline in starts was driven by a 9.2% drop in multi-family construction.

CAD

  • Manufacturing Sales m/m

USD

  • Crude Oil Inventories

Technical Overview
In the USDCAD. the bulls reclaim the broken 1.3650-65 area of support, which is now acting as resistance. If the bulls reclaim that level then all bets are off. In that potential scenario, I wouldn’t be surprised if the USD/CAD were to climb all the way towards the long-term 61.8% Fibonacci retracement level at 1.3835/40 or even higher towards 1.40s.

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