Canada Core Retail Sales m/m 09/22/09
8:30am (NY Time) CA Core Retail Sales m/m Forecast 0.1% Previous 1.0%
ACTION: USD/CAD BUY -0.5% SELL 0.7%
Our focus will be on the Core Retail Sales release, which is a measurement of the activities at the retail level of Canada, excluding most volatile Automobile Sales Components, which makes up about 25% of Retail Sales headline number. A higher Retail sales number means better economy, thus better for its currency. And of course the CORE reading provides a more accurate look at the retail spending of the economy.
My tried-and-true surprise factor (Deviation) will be 0.6% on the Core number. If my surprise factor is hit, we can expect the market to move 40 pips within the hour, with a historical accuracy of 78%. With USD/CAD hitting a support bottom last week of 1.0600, it will be used as our ultimate support; the upper resistance will probably be around the 1.0900 to 1.10000 psychological level for the time being.
We might see some USD strength from a much needed correction over the past few weeks of USD weakeness; especially in the event of USD/CAD as the currency pair is likely to trend upwards.
UPDATE: Canadian Retail Sales came out much worse than expected, which caused an immediate weakness in the CAD and upward movement in the USD/CAD pair. I waited for proper retracement while explaining to the trade room of a possible reversal due to market cycle, we got in at 1.0700… in about 30~40 minutes, we made over 30 pips on record and close the trade happy!
