AUD/CAD Remains Range Bound Prior to Release of Canadian Core Retail Sales Data

Earlier this week, on Monday, Statistics Canada released the month-over-month wholesale sales figure, which came decreased by 1% compared to a positive 0.1% forecast.

Then, on Tuesday, the Australian Bureau of Statistics released the quarter-over-quarter consumer price index (CPI), which suggested that consumer inflation in Australia rose 0.8% over the past quarter against a previous analysts forecast of 0.7%.

Binary options investors consider an increase in the inflation to be a sign that the Reserve Bank of Australia would be hiking key overnight interest rates. Also, the decline of the Canadian wholesale sales figure indicated a weak Canadian economy. Hence, the market outlook for the AUDCAD remained bullish for the last few days and the price of the AUDCAD increased by as much 90 pips.

However, the AUDCAD price could not break the high or the low of the July 20 daily range so far, forming an Inside Bar (IB). It is signaling that the binary options market is waiting for more data to decide on the direction of the price.

Later today, at GMT 12:30 p.m., the Statistics Canada will release another important fundamental data regarding the core retail sales in the country over the past month. The forecast is currently set at a 0.7% increase. Any large deviation in the core retail sales figure from the market’s expectation may create a momentum in either direction.

AUDCAD analysis - 24 july 2016

Hence, it is recommended that traders consider placing a CALL order with their binary options brokers if the AUD/CAD price closes above the 0.9637. On the other hand, if the AUD/CAD price closes below the 0.9547 level, which is the low of the Inside Bar from July 20, they may consider placing a PUT order instead.

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and write on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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