Source: PaxForex Premium Analytics Portal, Fundamental Insight
Economists predict the US ADP Employment Change for December at 400K. Forex traders can compare this to the US ADP Employment Change for November, reported at 534K. Traders should wait for the release of this report before placing orders, as it may drastically impact price action before Friday’s NFP report out of the US. Canada will also release its employment data on Friday. It may impact this currency pair if either report surprises traders with a reading to the upside or the downside, especially the wage component of the NFP report.
Economists predict the US Final Markit Services PMI for December at 57.5 and the US Final Markit Composite PMI at 56.9. Forex traders can compare this to the US Markit Services PMI for November, reported at 58.0, and the US Markit Composite PMI reported at 57.2.
The Canadian New Housing Price Index for November is predicted to increase by 0.5% monthly. Forex traders can compare this to the Canadian New Housing Price Index for October, which increased 0.9% monthly. Canadian Building Permits for November are predicted to increase 2.3% monthly. Forex traders can compare this to Canadian Building Permits for October, which increased 1.3% monthly.
The forecast for the USD/CAD remains bearish after this currency pair paused its correction after approaching its ascending Ichimoku Kinko Hyo Cloud. Volatility is likely to increase over the following trading sessions before the downtrend may resume. The Kijun-sen flatlined, suggesting a decrease of short-term bullish momentum, but the Tenkan-sen extends its advance. Traders should monitor the CCI for a false breakout above -100 from where a new push into extreme oversold territory is likely. Can bears maintain control over price action and force the USD/CAD into its horizontal support area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the USD/CAD remain inside the or breakdown below the 1.2665 to 1.2735 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.2710
- Take Profit Zone: 1.2360 – 1.2430
- Stop Loss Level: 1.2785
Should price action for the USD/CAD breakout above 1.2735, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.2785
- Take Profit Zone: 1.2920– 1.2965
- Stop Loss Level: 1.2735
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