AUD/CAD – Technical Analysis for Australian Forex Trading
Australia – CB Leading Index
Today, at GMT 2:30 p.m., the Conference Board Inc will release the month-over-month leading index for Australia, which measures the changes in the level of a composite index based seven other major fundamental indicators.
Since the CB leading index aggregates some of the other indicator data, Australian Forex traders consider this to be an important representation of the overall Australian economy. However, since most of these data are previously released, the CB leading index tends to have a minimized immediate market impact.
For the last three months, the CB leading index increased by 0.4% to 0.5% range and if the positive trend continues this month, it would like have a bullish influence on the Australian Dollar against other major currencies.
Canada – Core Retail Sales
On Thursday, during the afternoon at GMT 12:30 p.m., the Statistics Canada released the month-over-month core retail sales figure, which measures the changes in the total value of sales made by retailers in the country during the previous month.
The core retail sales figure excludes automobile sales. While the total retail sales may provide a complete picture, the highly volatile nature of car sales makes it difficult to compare the data on a monthly basis. Hence, Forex investors consider the core retail sales numbers are to be more appropriate.
Last month, the Canadian core retail sales figure decreased by 0.2% after decreasing 0.1% in April as well. If this trend continues, it would likely have a bearish impact on the Canadian Dollar against other major currencies this week.
Since breaking below the uptrend line on March 23, the AUD/CAD remained mostly range bound over the last three months. However, the pair seems to have respected the pivot zone around 1.0100 level, as the price often found both support and resistance around this price zone. Last week, the AUD/CAD once again found a strong resistance near the 1.0100 level and so far, it the pair is trading below this pivot zone.
The Australian CB leading index has been increasing over the last few months, but the Canadian core retail sales has been decreasing during the same time. If these two trends continue, we believe it would likely set a bullish fundamental outlook for the AUD/CAD this week. Therefore, if the AUD/CAD price penetrates and closes above the pivot zone near 1.0100 level, it would likely attract additional bullish momentum in the market.
Hence, Australian Forex traders should look out for trading opportunities above this major resistance level around 1.0100.
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