Forex Market: USD/CAD daily forecast

During yesterday’s trading session USD/CAD traded within the range of 1.0917-1.0955 and closed at 1.0943.

At 11:17 GMT today USD/CAD was losing 0.12% for the day to trade at 1.0927. The pair touched a daily low at 1.0928 at 11:16 GMT.

Fundamental view

United States

The initial jobless claims in the US probably rose to 313 000 in the week ended May 31st, from 300 000 a week ago, according to the median estimate by experts.

The indicator measures the number of applications for unemployment benefits that are recorded each week in a report prepared by the Bureau of Labor Statistics in the United States. Initial application or (Initial Claim) means a completed document from an unemployed person before the local government, which is considered a claim for compensation or the possibility of compensation. The completion of the initial claim marks the beginning of a period in which the applicant receives unemployment benefits. The survey covers the number of applications registered in the previous week and is an important indicator concerning the health of the US labor market.

The statistical arm of the US Department of Labor will release an official report at 12:30 GMT today. If jobless claims rose less than expected, this will provide support for the US dollar.

Canada

The number of building permits in the country probably rose 4.0% in April compared to a month ago, according to the median estimate by experts. In March permits issued by the government unexpectedly declined 3.0%. Building permits, as an indicator, provide information regarding demand in Canada’s housing market. A higher than anticipated number would be supportive for the Canadian dollar. Statistics Canada is to release its monthly report at 12:30 GMT.

Activity among purchasing managers in Canada probably increased in May, with the corresponding PMI coming in at a seasonally adjusted value of 58.4. In April the index stood at 54.1.

This indicator is based on a survey sponsored by Richard Ivey School of Business and Canadian Purchasing Management Association. It encompasses 175 respondents in both public and the private sector, selected in accordance with their geographic location and activity, so that the entire economy is covered. Activity among purchasing managers is closely watched by market players, as managers usually have an early access to data regarding performance of their companies, which could be used as a leading indicator of overall economic activity.

Readings above the key level of 50.0 are indicative of expansion in activity. Higher than expected readings of the PMI would bolster demand for the loonie. The official result is due out at 14:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, in case USD/CAD manages to breach the first resistance level at 1.0960, it will probably continue up to test 1.0976. In case the second key resistance is broken, the pair will probably attempt to advance to 1.0998.

If USD/CAD manages to breach the first key support at 1.0922, it will probably continue to slide and test 1.0900. With this second key support broken, the movement to the downside will probably continue to 1.0884.