By IFCMarkets
NonFarm forerunner
Today at 14:30 CET we expect the Trade Balance releases in the US and Canada. Besides, 15 minutes earlier the monthly Non-Farm Employment Change will be published by Automatic Data Processing. The indicator is based on the study of anonymous data of about 400.000 business clients, excluding the farming industry and government. The preliminary outlook of the employment growth is released 2 days ahead the Nonfarm publication. This is the reason this indicator is worth a closer look. Employment is the key factor influencing the US consumer demand. If the data is better-than-expected, it will almost certainly result in the US currency strengthening.
Here we consider USD/CAD currency pair on the H4 chart. As heavy crude oil prices plunge, the Canadian “quasi-commodity” currency continues to slump. At the moment the graphical analysis indicates two bullish signals: the price leaving the triangle in the direction of the green zone and the H4 resistance line breakout. However, the fractal breakout is not confirmed by the RSI-Bars oscillator. It is recommended to wait for the oscillator breakout at 84.3602% for position opening. Other trend indicators confirm the bullish market sentiment. Stop Loss can be placed at 1.17239. This mark is confirmed by Parabolic historical values and the Bill Williams fractal. If negative statistics will be released in the US, this mark may be used for placing the opposite order. In this case, the price would return into the limits of the trend channel and the trend pace would slow down.
However, this situation has little chances to be developed. As the figure shows, the volume of CAD futures contracts traded on the Chicago Mercantile Exchange is going up, so that it confirms the trend stability. Conservative traders are recommended to wait for the trading volume to outperform the level of 80 000 contracts. We will expect this mark to be exceeded to confirm the trend. To monitor the trading volumes click here.
Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.
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