USD/CAD Bearishness Likely to Continue as Canadian Raw Material Price Expected to Bounce

USD/CAD – Technical Analysis for US Binary Options Brokers

United States – Institute for Supply Management (ISM) Manufacturing PMI

Tomorrow, at GMT 4:00 p.m., the Institute for Supply Management will release its manufacturing PMI figure for the United States. The ISM’s US manufacturing PMI measures the level of a diffusion index based on a survey of 400 purchasing managers.

Purchasing managers in the United States are involved in the supply side of the economy. As most companies reduce their expenses and production based on their sales forecast, the survey of purchasing managers reveals the overall optimism of various companies in the country. Hence, binary options investors can easily figure out the sentiment regarding the economic condition in the country from the ISM manufacturing PMI readings.

Last month, the ISM manufacturing PMI for the United States came out at 53.2 and the forecast for this month is set at 53.7.

Canada – Raw Materials Price Index

On Thursday, at GMT 2:30 p.m., the Statistics Canada will release the month-over-month Raw Materials Price Index (RMPI), which measures the changes in the price of raw materials bought by manufacturers in the country over the past month.

Binary options traders consider the RMPI to be an important leading indicator of consumer inflation in Canada, because if manufacturers pay more to buy raw materials, then ultimately the retail customers end up paying for the higher cost of production.

Last month, the Canadian RMPI came decreased by -1.5% and the forecast for this month is currently set at an increase of 3.3%.

Trade Recommendation for the USD/CAD

Since forming a large bullish outside bar on December 14, 2016, the USD/CAD moved up by around 310 pips over the last two weeks. However, on December 28, the USD/CAD started a minor retracement after forming a small bearish pin bar, which pushed the price towards the support level around 1.3415.

Although the pair penetrated below the 1.3415 level, it soon bounced and now trading above the support.

As the Canadian RMPI is expected to increase by 3.3% this week, we believe the fundamental outlook for the USD/CAD would remain bearish this week. Hence, if the price closes below the 1.3415 level, it would attract additional bearish momentum in the market.

Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the USD/CAD with their binary options brokers as soon as the price closes below the 1.3415 level on the daily time frame.

Top US Binary Options Brokers to trade USDJPY

Top US Broker: BinaryMate

US Regulated Broker: NADEX

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