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15/6/2011 - The Current Market Sentiment

Discussion in 'Current Market Sentiments' started by fx-recommends, Jun 15, 2011.

  1. fx-recommends

    fx-recommends Content Contributor

    Aug 6, 2008
    Likes Received:
    The Canadian dollar is still well-supported by the release of the Canadian capacity utilization of the first quarter of this year which surged to 79% from 76.8% in the last quarter of 2010 and this figure came after Ivey PMI of May which rose significantly to 69.1 from 57.7 while the median forecast was referring to 60 to show strong improving of the Canadian industrial performance which can lead BOC to hike the interest rate specially after the declining of the Canadian unemployment rate to 7.4% in May from 7.6% in April and after the rising of April Canadian raw materials prices index by 6.8% yearly from 5.8% which can add more weights on BOC to start hiking the interest rate again after keeping it unchanged at 1% since 8th September 2010 to be the second following ECB which hiked it by .25% in April and has signaled earlier this month for another tightening action to come next July while the Fed is still in unable to take such tightening action as the US economy is setting back showing slow down signs.
    The Canadian dollar has found support in the first quarter of this year by the rising of energy and commodities prices which have been fueled by the tensions in Libya pushing the demand for the Canadian dollar as a safe haven too and helping the Canadian economy which has surplus of oil exports most of it to US to grow by 3.9% in the first quarter of 2011 from just 3% in the last quarter of 2010.
    USDCAD has fallen below 0.97 after the Canadian capacity utilization data depressed technically by being well below the trend line resistance which is extended from 1.1723 to 1.0669 and God willing, its next supporting level is now at 0.964 and breaking it can lead to another supporting level at 0.9512 before 0.9444 which has been reached in the beginning of May by the profit taken wave which hurt the commodities and energy markets while its next resistance is at 0.985 and the breaking of it can lead to a parity and getting over it can meet another resistance at 1.006 then 1.0379 over a longer range.

    Kind Regards
    FX Market Strategist
    Walid Salah El Din
    E-Mail: mail@fx-recommends.com

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