AUD/CAD Appears to Start a Bullish Retracement After Forming a Pin Bar Last Thursday

Canada – Raw Materials Price Index

Today, at GMT 1:30 p.m., the Statistics Canada will release the month-over-month Raw Materials Price Index (RMPI), which measures the changes in the price of raw materials bought by manufacturers in the country over the past month.

Australian Binary options traders consider the RMPI to be an important leading indicator of consumer inflation in Canada, because if manufacturers pay more to buy raw materials, then ultimately the retail customers end up paying for the higher cost of production.

Over the past several months, the Canadian RMPI has been gradually decreasing. But, in April, it came out better than expected. If the current trend continues, it would likely add additional bullishness to the Canadian Dollar.

Australia – Building Approvals

Tomorrow, at GMT 2:30 a.m., the Australian Bureau of Statistics released the national month-over-month building approvals figure, which measures the changes in the number of approvals of new buildings.

Since a build permit indicates new construction work, it suggests that there would be additional positive economic activities. For example, new jobs would be created for construction workers. Therefore, binary options investors consider this data regarding new building approvals to be a leading indicator of the overall economic health of the country.

Last month, the building approvals figure went up by 3.7% and the forecast for this month is currently set at a decrease of 2.8%.

Trade Recommendation for the AUD/CAD

AUDCADDaily

Since forming a Doji looking bearish pin bar on April 18, the AUD/CAD remained in a strong downtrend that pushed the price around 630 pips towards the 0.9325 level. However, the AUD/CAD found strong support around the 0.9325 level last week and formed a bullish pin bar.

As the Australian building approvals figure is expected to decrease this month, it would likely set the fundamental outlook for the AUD/CAD to a bullish note. However, if the AUD/CAD price closes above the high of the last week’s pin bar, which is at 0.9380, it could trigger a retracement move. Furthermore, the Canadian raw material price index is a rather insignificant data release and it may not have much impact on the market.

Under the circumstances, it would be recommended that binary options traders consider placing a CALL order for the AUD/CAD with their binary options brokers once the price closes above the 0.9380 level.

Recommended Broker for Australian Traders: HighLow

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 writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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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 writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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