Canada GDP got here in a lot stronger 2.6% versus 0.5% anticipated. In keeping with StatCan “the rise within the third quarter was pushed by a strengthening commerce stability, as imports dropped and exports edged up. Elevated capital funding was pushed by authorities capital spending, as enterprise funding was flat. Total progress was dampened by declines in family and authorities ultimate consumption expenditures in addition to a slower accumulation of enterprise stock.”
It’s an attention-grabbing improvement which can have economist wanting extra carefully on the circulate of products into the nation. I can see Canada shunning American items in response to tariffs on their exports. Nevertheless, it must be changed by items from different international locations if it’s not made internally. Was it an information assortment subject as effectively due to the US shutdown. It’s an outlier which calls for watching going ahead.
The USDCAD began to tilt decrease even earlier than the information hit, and the promoting accelerated after the discharge — elevating the query of whether or not it was a leak or simply skinny situations amplifying the transfer. The autumn pushed the pair beneath the 50% retracement of the vary from the late-October low, a stage that sits at 1.40135. That midpoint now turns into a near-term threat marker for merchants leaning towards additional draw back.
On the draw back, the following targets are the 61.8% retracement, adopted carefully by a key swing zone between 1.39684 and 1.39750. That space has been a significant pivot for each patrons and sellers since early October, repeatedly performing as a degree of rejection and reversal. A take a look at of that zone in the present day — or within the periods forward — is more likely to be a essential battleground for management.
Keep alert.
