Focusing on the Loonie once again after another weak data point brings fresh volatility to the session.
Intermarket Snapshot
| Equity Markets | Bond Yields | Commodities & Crypto |
| DAX: 11132.58 +0.38% FTSE: 6880.39 -0.30% S&P500: 2649.48 +0.63% DJIA: 24655.49 +1.03% |
US 10-yr 2.768% +0.036 Bund 10-YR 0.237% -0.004 UK 10-YR: 1.344% +0.02 JPN 10-YR: 0.005% +0.008 |
Oil: 53.19 +0.34% Gold: 1278.50 -0.38% Bitcoin: 3565.99 -0.46% Etherium: 117.15 -1.12% |
Fresh Market Headlines & Economic data:
-
- Shutdown enters 33rd day with no breakthrough in sight as US Senate sets votes
- ECB To Maintain Status Quo Amid Growth Risks
- Momentum gathers behind British MPs’ bid to stop no-deal Brexit
- Labour ready to whip MPs to back Cooper’s no-deal amendment
- BOJ Leaves Stimulus Unchanged as It Cuts Inflation Outlook Again
- SNB’s Jordan Doesn’t See a Digital Currency Muscling Out the Franc
- Statistics Canada says retail sales fell 0.9 per cent in November
- FHFA House Price Index Up 0.4% in November
Upcoming Potential Catalysts on the Forex Calendar:
- Richmond Manufacturing PMI at 3:00 pm GMT
- European Consumer Confidence at 3:00 pm GMT
- Australia Flash Manufacturing & Services PMI at 11:30 pm GMT
- Australia Employment Report at 12:30 am GMT Jan. 24
What to Watch: AUD/CAD
Check out this tight consolidation range on AUD/CAD, that could see a breakout on recent Canadian data and an upcoming top tier event from Australia.
This week has not been great for Canada in terms of economic reports with today’s weak reading on consumer retail sales and yesterday’s manufacturing/wholesale sales data, all coming in weaker-than-expected.
So far the reaction to today’s Canadian data has been bearish for the Loonie, and it could be the upcoming Australian employment report that could bring the volatility to break AUD/CAD out of the consolidation range. If it does come out better-than-expected, look for sustained trade above the .9520 handle to possibly lead to the previous resistance area around the .9565 area.
Expectations for the Aussie number, though, are for a lower net increase than the previous month, so it’s possible that we do get a downside move that isn’t likely to find support until the .9450 area. This would be a move around twice the size of the current consolidation between .9500 – 0.9520.
Both direction plays have good potential risk-to-reward, but you definitely have to be on your toes and play this one for the short-term.