AUDCAD Bullish Momentum Builds Amid Forecast of Improving Australian Building Approvals

Australia – Building Approvals

Tomorrow, at GMT 2:30 a.m., the Australian Bureau of Statistics will release 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 down by -5.2% and the forecast for this month is currently set at an increase of 0.9%.

Canada – Trade Balance

On Friday, at GMT 1:30 p.m., the Statistics Canada will release the monthly trade balance figure, which measures the difference in value between net import and export of goods over the past month.

Since the demand for export is directly correlated with the demand for the Canadian Dollar, binary options traders analyze the monthly trade balance in order to gauge the strength of the CAD against other major currencies.

Last month, the Canadian trade balance figure came out at -3.3 billion and the forecast for August is currently set a slightly better, but still negative, figure compared to July, at -2.6 billion.

Trade Recommendation for the AUDCAD

AUDCAD -binary options analysis- August 1, 2016

Since the formation of a bullish pin bar on May 26, the AUDCAD has remained in a strong uptrend and climbed around 600 pips in the process. Although the pair broke above the long-term downtrend line on July 8, it soon found a formidable resistance around the 0.9950 level on July 12 and started a minor retracement.

Last week, the AUDCAD once again tried to break above the psychologically important 0.9950 level, but once again failed to close above this resistance, which effectively formed a double top formation.

As the forecast for the Canadian trade balance is set at a negative figure, at -2.6 billion, and the forecast of the Australian building approvals figure has improved to deliver a positive growth of 0.9% against a -5.2% decline in the previous month, the fundamental outlook for the AUDCAD would likely remain bullish this week.

Under the circumstances, it would be recommended that binary options traders consider placing a CALL order for the AUDCAD with their binary options brokers as soon as the price and closes above the 0.9950 level on the daily chart.

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