The stock market in Asia is green. Shanghai Composite is growing 0.8 percent today and Hang Seng is gaining 2 percent. In Japan, Nkkei225 gained 1.1 percent.The currency market shows clear signs of risk appetite. They gain the following currencies: NZD, CAD, NOK. Safe currencies do not perform well: USD, CHF and JPY.CAD and NOK find additional support in oil price increases. WTI and Brent gain more than 1 percent today as oil set the high at 50.63 USD, at the most until December 17.
On Wednesday, the 9th of January, the event calendar is rich in important macroeconomic data releases and the event of the day is the Bank of Canada interest rate decision and press conference. Moreover, the global investors should keep an eye on German Trade Balance data, CPI data from Switzerland and Unemployment Rate data from the Eurozone. Later during the day, the FOMC Meeting Minutes will be released as well. There are speeches scheduled for today from BoE Governor Mark Carney, FOMC Members Eric Rosengren, Raphael W. Bostic and Charles Evans.
USD/CAD analysis for 09/01/2019:
The Bank of Canada interest rate decision is scheduled at 03:00 pm GMT and the market participants expect BoC to leave the interest rate at the level of 1.75% unchanged. This means the global investors will mostly focus on the rate statement, because if the BoC is hawkish about the inflationary outlook of the economy and raises the interest rates it is positive, or bullish, for the CAD. Likewise, if the BoC has a dovish view on the Canadian economy and keeps the ongoing interest rate, or cuts the interest rate it is seen as negative, or bearish. The same focus is expected during BoC Press Conference that is following the release of the Monetary Policy Report.
Let's now take a look at the USD/CAD technical picture at the H4 time frame. The downtrend is still continuing as the price is trading just above the technical support at the level of 1.3218. The market conditions are extremely oversold, so the bounce might happen any time soon. The nearest technical support is seen at the level of 1.3267, but the key technical resistance is the zone between the levels of 1.3345 - 1.3384. Please notice the negative and weak momentum is showing no signs of reversal.