USD/CAD – Technical Analysis for Regulated Binary Options Brokers
United States – Unemployment Claims
On Thursday, at GMT 1:30 p.m., the US Department of Labor will release the unemployment claims figure, which measures the changes in the number of people who claimed for unemployment insurance over the last week.
Binary options investors consider the unemployment claims data to be one of the most important fundamental indicators of the US job market. This is primarily because unemployment and consumer spending has direct correlation and an increasing number of unemployment claims indicate lower consumer spending in the economy, which makes up the bulk of the economic activity in the United States.
Last week, the US unemployment claims figure came out at 261,00 and the forecast for this week is set at a decrease to 244,000.
Canada – Raw Materials Price Index
On Thursday, at GMT 1:30 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 increased by 1.7%, after increasing 6.5% in the previous month. If the trend continues, it would likely to have a bullish effect on the Canadian dollar.
Trade Recommendation for the USD/CAD
Since breaking above the downtrend line on February 20, 2017, the USD/CAD went up by around 410 pips and found resistance near the 1.3530 level. Since then, the USD/CAD retraced towards the 1.3280 level, but so far failed to close below this support level in the last two tries.
Although the Canadian RMPI has been going up for a while, it has a lesser significance compared to the US unemployment figure. Therefore, as the US unemployment claims figure is expected come down from 261,000 to 244,000 this week, we believe it would likely set a bullish fundamental outlook for the USD/CAD. Hence, if the USD/CAD price penetrates and closes above the 1.3400 level, which is the high from last week, it would likely attract additional bullish pressure in the market.
Under the circumstances, it would be recommended that binary options traders consider placing a CALL order for the USD/CAD with their regulated binary options brokers as soon as the price closes above the 1.3400 level on the daily timeframe.
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