What awaits USDCAD after the release of the GDP report?
At 1.30pm today we get the latest release from Statistics Canada of the month on month GDP report.
This report measures the change in the inflation adjusted value of all goods and services produced by the country.
With Canada being a major hydrocarbon producer and with OPEC deciding not to cut production in will be interesting to see how this will affect the GDP numbers.
The prior report can in at -0.1% with the consensus forecast expected to coming in at 0.4%.
With the USDCAD trading in a strong up trend lower than expected numbers will only fuel the continued depreciation of the Canadian Dollar against the US Dollar.
The technical review
USDCAD is trading in a daily uptrend. This can be clearly identified by a series of higher high and higher low swings.
The price action has recently experienced a controlled correction that has actually turned the moving averages negative.
However this price action did not come anyway near to penetrating the 1.1120 level.
This level is the areas of the last isolated daily swing low of the October 29.
The move down and subsequent bounce came off an area of Fibonacci support.
As the trend is up my initial long target is 1.1467 being the area of the November 5 swing high.
The next target point for USDCAD is 1.1725 being the weekly high of July 5.
A failure of USDCAD to sustain its upward momentum could be followed by a penetration of the 1.1190 level being the November 21 swing low would technically change the trend from up to down.
This would open up the possibility of a move down to the 1.0900 being the September 19 swing low
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