Canada - Raw Material Price Index
Later, at 13:30 GMT, Statistics Canada will announce the monthly raw materials price index (RMPI), which measures changes in the prices of raw materials purchased by manufacturers in the country during the past month. Forex traders look at the raw material price index RMPI It is an important leading indicator of consumer price inflation in Canada, because if manufacturers pay more to purchase raw materials, then retail customers will eventually pay more at higher production costs.
Last month, the Canadian raw materials price figure came in lower at -0.1% and expectations for this month are now set at an increase of 3.2%.
United States - Institute for Resource Management Manufacturing Purchasing Manager's Index (ISM)
Thursday, at 15:00 GMT, the Institute for Supply Management released the manufacturing PMI for the United States. The Institute for Resource Management's US Manufacturing Purchasing Managers' Index measures the level of the Diffusion Index based on a survey of 400 purchasing managers. Purchasing managers in the United States are involved in the supply side of the economy. As most companies reduce their expenditures and production on the basis of their sales forecasts, the survey of purchasing managers reveals the overall optimism of various companies in the country. Thus, binary options investors can easily get acquainted with the sentiment about the economic situation in the country through the readings of the Purchasing Managers Index of the Institute of Resource Management.
Last month, the US Institute of Resource Management's Purchasing Managers' Index came in at 51.9 and expectations for this month were set at 52.1.
Trading recommendations for the US dollar / Canadian dollar
Since August 18, 2016, the USD/CAD currency pair has been in a strong uptrend and formed many uptrend lines in the process. But shortly after the USD/CAD price reached near the pivotal 1,3500 area in At the beginning of November, the bullish momentum faded and the pair started to swing between the levels of 1,3420 and 1.3590. Earlier today, the USD/CAD price broke below one of the ascending trend lines as well as the important psychological support level around 1.3465.
As the Canadian Raw Materials Price Index is expected to rise by 3.2%, we believe that this is likely to have a negative impact on the USD/CAD rate. Thus, if the USD/CAD price closes below the 1,3465 level, it is likely to attract additional bearish momentum in the market. Under these circumstances, it would be a good idea for forex traders to consider setting up a short order for the USD/CAD currency pair with Binary options brokers as soon as the price closes below the 1,3465 level on the daily time frame.