USD/CAD Eyes Monthly Opening Range Ahead of BoC Meeting

Talking Points:

USD/CAD Eyes Monthly Opening Range as Canada Employment Beats Forecast.

GBP/USD Weakness to Persist on Slowing U.K. CPI, Average Weekly Earnings.

DailyFX Table


USD/CAD Daily Chart

Chart – Created Using Trading View

  • USD/CAD continues to give behind a allege from progressing this month as Canada Employment exceeds marketplace expectations, with a segment adding another 19.4K jobs in March, while U.S. Non-Farm Payrolls (NFP) increasing 98K during a same duration amid forecasts for a 180K expansion.
  • The unsuccessful try to break/close above a Fibonacci overlie around 1.3450 (23.6% retracement) to 1.3460 (61.8% retracement) shifts a near-term opinion towards a downside generally as USD/CAD triggers a array of reduce highs lows; will continue to guard a developments in a Relative Strength Index (RSI) as former trendline support appears to be charity resistance.
  • The uptick in a Labor Force Participation Rate accompanied by a ongoing pickup in full-time positions might put increasing vigour on a Bank of Canada (BoC) to lift a benchmark seductiveness rate off of a record-low, yet Governor Stephen Poloz might continue to validate a wait-and-see proceed during a assembly on Apr 12 as a executive bank conduct warns normalizing financial process betimes would pull a economy behind into recession; in turn, some-more of a same from Poloz Co. might moderate a seductiveness of a Canadian dollar as it drags on interest-rate expectations.
  • Broader opinion for USD/CAD stays constructive as it preserves a ceiling trend carried over from a prior year, yet a miss of movement to exam a 2017-high (1.3535) might hint a pierce behind towards a Fibonacci overlie around 1.3280 (50% retracement) to 1.3310 (38.2% retracement), that mostly lines adult with a Apr low (1.3295).


GBP/USD Daily Chart

Chart – Created Using Trading View

  • Despite a initial spike aloft immediately following NFPs, GBP/USD struggles to reason a belligerent as marketplace participants change their concentration to a Underemployment Rate (U6), that slipped to an annualized 8.9% from 9.2% in Feb to symbol a lowest reading given 2007; notwithstanding a churned information prints, Fed Fund Futures continue to prominence a larger than 60% for a Jun rate-hike, and a devious paths for financial process casts a long-term bearish opinion for Cable as a Bank of England (BoE) appears to be in no rush to lift a benchmark seductiveness rate off of a record-low.
  • The British Pound stands during risk of confronting serve waste over a days forward as a U.K. Consumer Price Index (CPI) is approaching to slight in March, while Average Hourly Earnings are projected to downtick to an annualized 2.1% from 2.2% in January; signs of negligence price/wage enlargement might inspire a Bank of England (BoE) to keep a stream process via 2017 as executive bank officials advise ‘monetary process can respond, in possibly direction.’
  • Even yet a BoE appears to be on march to finish a Corporate-Bond squeeze module forward of a 18-month timeline, Governor Mark Carney and Co. might try to buy some-more time during a subsequent process assembly on May 11 amid a mixed information prints entrance out of a U.K. economy, and a executive bank might keep a doorway open to serve support a economy as a depart from a European Union (EU) clouds a opinion for enlargement and inflation.
  • With that said, downside targets are in concentration for GBP/USD generally as a RSI struggles to safety a bullish arrangement carried over from a prior month; a break/close subsequent 1.2370 (50% expansion) opens adult a subsequent downside segment of seductiveness around 1.2270 (23.6% retracement) followed by 1.2100 (61.8% expansion).

For More Updates, Join DailyFX Currency Analyst David Song for LIVE Analysis!

Click HERE for a Entire DailyFX Webinar schedule.

DailyFX Calendar

Click Here for a DailyFX Calendar

If you’re looking for trade ideas, check out a Trading Guides.

Read More:

April Forex Seasonality Sees USD Weakness contra AUD, GBP, and EUR

Technical Weekly: GBP/USD – Setting a Table for Cable

DailyFX Roundtable: Post Brexit Trade Setups and Themes

Silver Price Makes It Nine in a Row, Turning Lower off Jul Trend-line

Crude Oil Price Forecast: Oil To 200DMA On Libya’s Force Majure Claim

— Written by David Song, Currency Analyst

To hit David, e-mail Follow me on Twitter during @DavidJSong.

To be combined to David’s e-mail placement list, greatfully follow this link.

About author

How Malcolm Turnbull stayed on script

Video Image Malcolm Turnbull outlined the state of Australia’s energy infrastructure and how the plans for the future will be powered. Courtesy: Sky News PM ...