Positive consumer spending continues to boost the demand for risk to commence this week’s currency exchanges. The Canadian dollar is looked forward to regain its momentum over the safety bet US dollar, even as finance ministers in the Euro region debate on an aid payment to Athens and forge a clear blueprint to keep the indebted country solvent.
Following a drop to the 0.9913 price low, USDCAD price action encountered a technical correction as the price index was registered as oversold. The Loonie is now plotting a strengthening price movement where the lower psychological handle is deemed as the primary target. Gains in risk demand are likely to aid the bearish action, what with Holiday sales keeping the markets fresh.
With no economic data to follow today, except for hope that an agreement would be arrived at in Brussels to stimulate global risk, market focus in North America would be on how US retailers extend their deals into Cyber Monday to try to sustain a 13 percent gain in Thanksgiving weekend sales. In a report by ComScore yesterday, Black Friday retail sales online this year topped $1 Billion for the first time ever as more consumers used the Internet do their early holiday shopping. ShopperTrak, which counts foot traffic in physical retail stores, estimated Black Friday sales at $11.2 Billion. Though down by 1.8 percent from the same day last year, this was likely a result of increased e-commerce activity as online shoppers become lured by low prices, convenience, faster shipping and wide selections.
Retailers have capitalized on the Thanksgiving weekend by extending Black Friday and Cyber Monday into a week’s worth of deals, as stores opened earlier and more deals were offered online. In fact, Thanksgiving Day, which was traditionally reserved for family gatherings, saw the number of shoppers rise to more than 35 Million from 29 Million last year, according to the National Retail Federation. Also, spending in stores and online rose to $59.1 Billion in the four days starting November 22, says the NRF in a statement yesterday. A year ago, sales advanced 16 percent over the holiday weekend.
As investors anticipate more economic activity today, Cyber Monday, risk demand is perceived for some more gains. The Loonie is likely to benefit, and the USDCAD is suggested to be sold, though technical price corrections are still probable. Be wary also of developments in the European Union as a clear agreement or a lack of it would surely affect the markets today.
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