USDCAD and USDJPY key pairs to watch on Wednesday

We anticipate some volatility after key economic data: Chart

Charts (6)

The US Dollar was bearish against most of its major pairs on Tuesday with the exception of the NZD, AUD and CAD. On the US economic data front, Retail Sales Advance rose 0.3% on month in October (+0.5% expected), compared to a revised +1.6% in September. Finally, Industrial Production increased 1.1% on month in October (+1.0% expected), compared to a revised -0.4% in September.  

On Wednesday, the Mortgage Bankers Association's Mortgage Applications data for the week ending November 13th is expected. Finally, Housing Starts for October are expected to rise to 1,460K on month, from 1,415K in September.                 

The Euro was bullish against most of its major pairs with the exception of the CHF, GBP and JPY. In Europe, no major economic data was released.

The Australian dollar was bearish against all of its major pairs. 


On Wednesday, Canada is expected to report an inflation rate of 0.3% YoY in October compared to 0.5% in the month prior. We have seen an average of 69 pips of volatility after past inflation reports. The pair remains in a consolidation pattern between 1.299 support and 1.342 resistance. A double bottom may be in play but is not confirmed until price action breaks above 1.342 resistance. The preference is for a rebound higher towards 1.365. 



Source: GAIN Capital, TradingView


Japan will report its October trade balance which likely narrowed to 210 billion Yen on a seasonally-adjusted basis from 675 billion Yen in September as new lock downs due to the coronavirus slow exports. We measured 26.5 pips volatility in the 4 hours after past events. Looking at the chart of the USD/JPY ahead of the data, key resistance remains at the 106.10 level. A break above could have strong bullish implications. For now, the preference is to ride the trend lower ultimately reaching the 102 support level. 



Source: GAIN Capital, TradingView

Happy Trading

More from Forex

Disclaimer: GAIN Capital UK Limited (trading as "Forex.com") is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, Forex.com does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by Forex.com or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although Forex.com is not specifically prevented from dealing before providing this material, Forex.com does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.