By FX Empire.com
The USD/CAD pair extended its losses on Wednesday, as hopes EU leaders will reach a solution to ease the European debt crisis overshadowed the Slovak Parliament’s rejection of expanding the size and power of the European Financial Stability Facility, which boosted confidence in markets and encouraged investors to target higher yielding assets, which pushed the USD/CAD pair to the downside.
We advise traders of extreme caution in trading over the coming period, since the recent rally in markets is based on hopes and optimistic expectations, however, if EU leaders fail to assure markets, we expect risk aversion to dominate markets once again, however, given the recent change in sentiment, it seems that the USD/CAD pair could extend its downside wave, but we remain extremely cautious over the outlook.
Thursday October 13:
Canada will release the international merchandise trade balance for August at 12:30 GMT, where the trade deficit is expected to widen to 1.00 billion CAD from the prior deficit of 0.75 billion CAD.
The U.S. trade figures are due at 12:30 and the trade deficit in August is expected to widen to $46.0 from $44.8 billion.
The weekly jobless claims are also due at 12:30 GMT after last week they rose to 401 thousand.
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