Canada Ivey PMI - much better but markets in Risk-Off and don't care

This afternoon at 15:00 GMT on Tuesday March 6th 2012 (10:00 EST) the Ivey PMI figures were released from Canada. These numbers usually do not cause much of a reaction unless there is a very big deviation, however sometimes a more modest deviation can cause a slower trend to form.

The figures were quite good, however the market is in Risk-off mode as the amount of PSI involvement of the Greek Bond Swap deal is very much getting attention as the final deadline approaches.

Here is the data:

Canada Ivey Purchasing Managers Index
Estimates -> Median: 62.0 Average: 62.4 Low: 58.5 High: 66.0
Actual: 66.5 Prior: 64.1 No Revision

Here are 2 quick 5 minute charts of USDCAD and CADJPY forex pairs, just for the record...

Canadian Ivey Purchasing Managers Index - Higher Print leads to reversal

This afternoon of Monday February 6th 2012 at 10:00 EST (15:00 GMT) the PMI figure was released from Canada. This figure has not been affecting the price of the Canadian Dollar very much unless there is a very large deviation. However if one is trading longer term it can support the general direction of the trend.

Today saw a decently higher print on this, not enough to trigger a trade. Often Canadian data gets leaked but regardless if it was a rumor or just good analysis the USDCAD sold off into the news. Of course a lower USDCAD means Canadian Dollar strength. When the news was released there was a small blip, but then a reversal of about 20 pips over then next 45 minutes before the down trend re-established itself. Here is the data:

Canada Ivey Purchasing Managers Index
Estimates- Median: 59.7 Average: 58.9 Range: 54.0 to 62.0
Actual: 64.1 Prior: 63.5 No Revision

I include 2 charts, the USDCAD and the CADJPY, both 1 minute charts. These 2 pairs traded inverted to one another. When CADJPY hits resistance at the same time as USDCAD hitting support, there is a good probability of them bouncing some.

US ISM Non-Manufacturing - Slightly lower print punctuates dowswing from the Open

Risk off day as problems with European banking sector hit the market. US market had already digested some good ADP numbers and slightly better weekly jobless numbers. Stock indices sold off as the New York cash equity opened and this ISM release was slighted for half an hour later. This slightly lower deviation caused a little extra selling pressure to pierce some lows and basically punctuate the low before reversing. It was not a big enough deviation to cause much of a move.
The Ivey PMI figures for Canada were released at the same time.

Here the figures:

US ISM Non-Manufacturing Index
Estimates: Median 53.0 Average 53.1 Range 52.0 to 55.0 (52.5-53.5 most)
Actual: 52.6 Prior: 52.0 No Revisions

CAD Ivey PMI
Estimates: Median 58.0 Average 58.4 Range 56.0 to 61.0
Actual: 63.5 Prior: 59.9 No Revisions

First chart is the 1 minute chart of the EMini S&P 500 Futures Contract. The 3pm GMT (10am EST) release brought a slightly lower low which then brought about a reversal higher:

Next the 30 second chart of the USDJPY, which had rallied since the good nearly +150k deviation on the 13:15 GMT (8:15 EST) release of US ADP, it did sell off a bit on the news:

Finally the 30 second chart of the CADJPY is interesting as the strong Canadian Ivey PMI data did not move the pair up initially as it is so highly correlated to the Stock Indices and the risk appetite/aversion dynamic in the market:

CAD Ivey PMI higher

Canadian Ivey PMI comes out at 59.9 versus 54.4 expected and USDCAD moves further down in Canadian Dollar strength after the strength initially caused by the BOC Statement at the Interest Rate Decision. Basically killing all expectations of a cut early in 2012. With GDP at 3.5% and CPI at 2.9% this PMI readings shows despite the global slowdown Canada at least is not doing so badly.

Canadian Ivey Purchasing Managers Index Comes in Low

Even more forex news trading today - What a week!!!! The USD has been sold across the board against all pairs. The Canadian Dollar or loonie (nickname given due to the loonie bird seen on its $1 coins) is one pair which has lagged the gains seen by other pairs, this is likely cause by the fact that Canada does alot of trade with the USA and thus is affected by the US economy. The Bank of Canada did raise rates some months ago but then did not continue last time they met, which held down the appreciation of the Canadian Dollar. Today we have seen the USDCAD start to make progress towards reaching parity with the US Dollar, which the Australian Dollar and Swiss Franc have already done recently. However a poor number on the Ivey Purchasing Manager's Index put an obstacle in the way of the pair progress towards that level. Coming with a deviation of -8.3, this is a significant deviation and is definately enough to trigger a news spike trade using the Auto-click software - Secret News Weapon. Here is the number:

*(CA) CANADA OCT IVEY PURCHASING MANAGERS INDEX: 56.7 V 65.0E

The USDCAD did move some 30 pips up as the loonie depreciated, which isn't great considering the deviation, however in the context of the strong USD selling it was decent enough and most traders were able to pull a solid +20 pips out of this spike. They had to take profits quickly however as within 10 seconds the USDCAD had retraced some 20 pips from its highs. See the first chart which shows the 5 second price action during this news release. This was not a big problem unless high leverage was used and the broker slipped the fill price on the entry order...know thy broker!...because it only setup the USDCAD for an ideal afterspike, pulling back to the 78% fib of the spike move...this gave an ideal forex news afterspike trade which is easier for some because there is more time to give in and the move back up was more gradual with plenty of time to lock in profits along the way...see the 2nd chart for this...USDCAD turned around as it approached 1.0050, a key level mentioned in the room. Will USDCAD forget about this and join the rest of the pairs against the USD and achieve parity..Canadian Employment Change tomorrow will decide.