Forex traders will await US retail sales data which disappointed last month to gauge if consumer spending has picked up once again. Industrial production and manufacturing production is expected to show its second monthly contraction while the Import/Export Price Index is anticipated to show the rise in deflationary pressures. How will this data impact price action in the USDCAD? Today’s fundamental analysis will take a look at price action in both directions.
Canadian housing data may have an impact on the Canadian Dollar which has weakened sharply against the US Dollar. Commodity prices have decreased as trade concerns are once again increasing and the outlook for the global economy remains weak. With the USDCAD at a strong resistance level, will bulls be able to force a breakout or can bears ignite a price action reversal? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here are the key factors to keep in mind today for US Dollar trades:
- US Advanced Retail Sales: US Advanced Retail Sales for October are predicted to increase by 0.2% monthly and Retail Sales Less Autos are predicted to increase by 0.4% monthly. Forex traders can compare this to US Advanced Retail Sales for September which decreased by 0.3% monthly and to Retail Sales Less Autos which decreased by 0.1% monthly. Retail Sales Less Autos and Gas for October are predicted to increase by 0.3% monthly and Retail Sales Control Group are predicted to increase by 0.3% monthly. Forex traders can compare this to Retail Sales Less Autos and Gas for September which were reported flat at 0.0% monthly and to Retail Sales Control Group which were reported flat at 0.0% monthly.
- US Import and Export Price Index: The US Import Price Index for October is predicted to decrease by 0.2% monthly and by 1.9% annualized. Forex traders can compare this to the US Import Price Index for September which increased by 0.2% monthly and which decreased by 1.6% annualized. The US Import Price Index excluding Petroleum for October is predicted to decrease by 0.1% monthly. Forex traders can compare this to the US Import Price Index excluding Petroleum for September which decreased by 0.1% monthly. The US Export Price Index for October is predicted to decrease by 0.1% monthly and by 1.5% annualized. Forex traders can compare this to the US Export Price Index for September which decreased by 0.2% monthly and by 1.6% annualized.
- US Empire Manufacturing Index: The US Empire Manufacturing Index for November is predicted at 6.0. Forex traders can compare this to the US Empire Manufacturing Index for October which was reported at 4.0.
- US Industrial Production and Manufacturing Production: US Industrial Production for October is predicted to decrease by 0.4% monthly and Manufacturing Production is predicted to decrease by 0.4% monthly. Forex traders can compare this to US Industrial Production for September which decreased by 0.4% monthly and to Manufacturing Production which decreased by 0.5% monthly. Capacity Utilization for October is predicted at 77.1%. Forex traders can compare this to Capacity Utilization for September which was reported at 77.5%.
- US Business Inventories: US Business Inventories for September are predicted to increase by 0.1% monthly. Forex traders can compare this to US Business Inventories for August which were reported flat at 0.0% monthly.
Here is the key factor to keep in mind today for Canadian Dollar trades:
- Canadian Existing Home Sales: Canadian Existing Home Sales for October are predicted to increase by 2.0% monthly. Forex traders can compare this to Canadian Existing Home Sales for September which increased by 0.6% monthly.
Should price action for the USDCAD remain inside the or breakdown below the 1.3240 to 1.3300 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.3250
- Take Profit Zone: 1.3040 – 1.3100
- Stop Loss Level: 1.3330
Should price action for the USDCAD breakout above 1.3300 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.3330
- Take Profit Zone: 1.3520 – 1.3565
- Stop Loss Level: 1.3250
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