UNEMPLOYMENT INSURANCE WEEKLY CLAIMS: In the week ended on May 16, the advance figure for seasonally adjusted initial claims was 274,000, 10,000 up from the previous week's unrevised level of 264,000.
US Manufacturing PMI eases to a 16-month low in May. US manufacturing output growth weakened for the second month in May. It was the slowest since January 2014. The seasonally adjusted Markit Flash US Manufacturing Purchasing Managers' Index fell from 54.1 in April reflecting the weakest improvement in overall business conditions since the start of 2014.
The pair probably made a double top at 1.2256 and changed the direction. The pair has been consolidating at 100Dema for 2 days. The parallel support is found at 1.2169. The selling will emerge below 1.2169 towards 1.2130 and 1.2090. Bulls' real problem is likely to ignite below 1.2080 towards the previous low. Today, we expect 1.2130 and 1.2100. CAD is trading higher against USD ahead of Canada Core CPI m/m, CPI, and Core retail sales m/m. We expect the Canadian economy to continue following the positive trend. Strong resistance zone is seen at 1.2350. A daily close above 1.2350 leads to a fresh new high. On the downside, the pair formed a minor base between 1.1940 and 1.1900 and strong support is found at 1.1885 and 1.1795. On a weekly basis, the pair managed to gain 200 pips. After 5 consecutive weeks of losses, bulls managed to cover some loses this week. Our buy-on-dip bullish view is likely to remain in play with sl 1.2090. For today's trade, bears should sell below 1.2160 with targets at 1.2130 and 1.2100 following the trend. On the higher side, we recommend buying above 1.2200 with targets at 1.2240/50 initially, and 1.2300 and 1.2325 later. The pair gave an upside break from the month old descending trendline. The real strength for bulls is seen above 1.2310, trend-changing level is at 1.2350.
The material has been provided by InstaForex Company – www.instaforex.com