The Ivey PMI index came in at 56.9 above the consensus of 52.5 and last months 51.2. The CAD got stronger initially – with the USDCAD moving back down to the 100 and 200 bar MA (blue and green line in the chart below), but has since reversed course. HMMMM. The price is not supposed to do that, is it?
IVEY PMI trends
The Ivey does have a tendency to whip around. The chart above shows the low for the year at 46.9 and the high at 58.6. So there is a reason for the reaction. The release has a lot of up and down volatility. I pity the economists who put an estimate on it on a monthly basis.
The USDCAD is showing a lack of conviction
Looking at the price action from the 5 minute chart in the USDCAD at the moment, it kind of mirrors the volatility seen in the Ivey PMI data. So I guess I can not be too surprised with the react from the better than expected data.
When the price action shows this, it is important to ask yourself “Is this the type of market that I am interested in trading?” I know what my answer is.
Exit stage left. Next!