Canada's economy continues to grow steadily.

The Canadian dollar remained near a five-month high at 1.344 CAD per USD. This stability is due to investor focus on key economic data from both Canada and the U.S. Following the release of GDP data, it was found that Canada's GDP grew more than expected, easing concerns about an economic slowdown. However, this reduces expectations for monetary policy easing by the Bank of Canada, as the economy is still perceived to be capable of growth even amid high interest rates.

Canada's economy expanded by 0.5% in the second quarter of 2024, marking two consecutive quarters of growth after a 0.4% increase in the previous period. This growth was mainly driven by a 1.5% increase in government spending, which included higher wages and a recovery in government purchases of goods and services. Meanwhile, business investment in machinery and equipment surged by more than 6.5%. However, household spending slowed to 0.2% in Q2, down from 0.9% in Q1, due to rising prices in the services sector.

Foreign investors bought $5.2 billion of Canadian securities in June, marking the fourth consecutive month of investment, although this amount was below the expected $15.9 billion and less than the levels of the previous two months. Most investments continued to be in private corporate bonds, with over $10 billion purchased, reflecting confidence that domestic companies can continue to grow and compete, especially newly issued bonds this year due to high interest rates. Meanwhile, foreign investors bought $7.5 billion in government bonds to hedge against unexpected risks.

Canada's inflation rate slowed to 2.5% year-on-year in July, down from 2.7% in the previous month. This slowdown aligns with the Bank of Canada's forecast that inflation will drop to 2.5% in the second half of the year. While inflation remains elevated due to rising oil prices and the cost of other imports, food inflation has not increased significantly.

Canada's Business Confidence Index, a long-term index reflecting the 12-month outlook for business performance within the country, rose to a two-year high of 56.8 in August from 55.5 in the previous month. The increase was mainly driven by confidence among small businesses that the economy can continue to grow and that interest rates will stabilize. Meanwhile, household spending is expected to pick up again in the future.

Techical analysis data (5H)

Resistance: 1.3504, 1.3529, 1.3548

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 1.3441 - 1.346 but cannot break the support at 1.346, you may set a TP at approximately 1.3529 and SL at around 1.3416 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 1.3504 - 1.3529, you may set a TP at approximately 1.3548 and SL at around 1.3441 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 1.3504 - 1.3529 but cannot break the resistance at 1.3504, you may set a TP at approximately 1.3441 and SL at around 1.3548 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 1.3441 - 1.346, you may set a TP at approximately 1.3416 and SL at around 1.3529 or according to your acceptable risk.

Pivot point August 30, 2024 10:54PM. GMT+7