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18 Dec 2015
Canadian CPI preview: What to expect of USD/CAD
FXStreet (Córdoba) - Canadian consumer price index for November is the highlight of the American session to be released at 13:30 GMT. Headline inflation is expected to grow 0.1% MoM and 1.5% YoY, while core inflation, which excludes volatile items food and energy, is expected to stay flat MoM but to rise 2.3% YoY.
With the Fed liftoff behind and markets entering holiday mode, data is not expected to trigger much volatility. However, with USD/CAD trading at 11-year highs and technicals showing overbought readings in almost every time frame, higher-than-expected inflation numbers could led to a significant correction. For the same reason, in case of disappointing CPI data, USD/CAD could attempt to push higher, but the upside potential seems limited at the moment.
USD/CAD levels to watch
In terms of technical levels, on the downside short-term supports are seen at 1.3777 (Dec 17 low), 1.3716 (10-day SMA) and 1.3672 (Dec 15 low). On the upside, next resistances could be faced at 1.3985 (11-year high, Dec 17), 1.4003 (May 18 2004 high), 1.4086 (Aug 28 2003 high) and then 1.4100 (psychological level).
With the Fed liftoff behind and markets entering holiday mode, data is not expected to trigger much volatility. However, with USD/CAD trading at 11-year highs and technicals showing overbought readings in almost every time frame, higher-than-expected inflation numbers could led to a significant correction. For the same reason, in case of disappointing CPI data, USD/CAD could attempt to push higher, but the upside potential seems limited at the moment.
USD/CAD levels to watch
In terms of technical levels, on the downside short-term supports are seen at 1.3777 (Dec 17 low), 1.3716 (10-day SMA) and 1.3672 (Dec 15 low). On the upside, next resistances could be faced at 1.3985 (11-year high, Dec 17), 1.4003 (May 18 2004 high), 1.4086 (Aug 28 2003 high) and then 1.4100 (psychological level).