USDCAD – Binary Options Technical Analysis
Canada – Manufacturing Sales
Tomorrow, at GMT 1:30 p.m., the Statistics Canada will release the month-over-month manufacturing sales data, which measures the changes in the total value of sales made by Canadian manufacturers over the past month.
Since changes in manufacturing sales affect the manufacturers’ future decisions regarding hiring, corporate spending, and overall investment climate in the country, binary options investors consider the manufacturing sales data to be a leading indicator of the Canadian economy.
In September, the Canadian manufacturing sales figure increased by 0.1% and the forecast for this month is currently set an increase of 0.3%.
United States – Core Consumer Price Index
At the same time, at 1:30 p.m., the US Bureau of Labor Statistics will release the month-over-month Core Consumer Price Index (CPI) data.
Since the Core CPI measures the changes in the price of goods and services but excludes the volatile food and energy prices, binary options traders consider this data to be more important compared to the CPI figure.
Last month, based on the US Core CPI, there were around 0.3% inflation in the economy. This month, the forecast is set at 0.2% inflation.
Trade Recommendation for the USDCAD
Although USDCAD broke below the uptrend line on August 11, 2016, the price soon resumed the uptrend and so far, climbed around 540 pips over the last two months. During this time, the USDCAD has formed two additional uptrend lines.
Last Friday, the USDCAD price broke below the first uptrend line and reached the support level around 1.3100. However, due to a lack of bearish momentum in the market, the USDCAD failed to penetrate below this key support level.
As the Canadian manufacturing sales is expected to improve compared to last month, it is likely that the fundamental outlook for the USDCAD would remain bearish this week. Furthermore, the forecast of a declining US core CPI also supports this bearish thesis.
Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the USDCAD with their binary options brokers as soon as the price closes above the 1.3100 level on the daily time frame.
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