Canadian dollar could hit an 8-month low if today’s GDP report is soft

The first look at Q4 GDP is due at the bottom of the hour

Canadian headlines are dominated by talk of tariffs and a trade war today. There are hopes that Canadian producers could be exempted but that’s based more on hope than any evidence yet.

USD/CAD is technically vulnerable with a major resistance level looming. About a half-cent above spot is the triple top of 1.2920 that was formed late last year. A break would first target the Feb 2017 low 1.2962 followed by 1.3000 and then it could be a quick move higher from there — especially if there’s a reason to buy.

It’s probably a stretch for GDP to move the market enough to break that level but it’s possible. This is the first look at the fourth quarter, which is forecast to show 2.0% annualized growth, up from 1.7% in Q3. It will also show the first look at 2017 calendar-year growth, which is expected to lead the G7.

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