USD/CAD back above 1.3600 after another rebound from 1.3500
|- USD/CAD about to end flat a volatile week.
- US dollar gains momentum on Friday despite risk appetite.
- Critical week ahead with FOMC and employment reports.
The USD/CAD is up for the second day in a row and moved further away from the one-month low it reached on Thursday below 1.3500. The pair is holding firm above 1.3600, about to end the week flat.
Loonie fails to break 1.3500 and retreats
Near the end of the week, USD/CAD is hovering around 1.3620/30, at the highest level in two days. The rebound from under 1.3500 reflects difficulties for the loonie to rise further and at the same time, that the dollar is not ready yet for a deeper correction, ahead of a critical week.
For the second time in October, USD/CAD managed to remain above 1.3500. The rebound so far has been limited. The next resistance stands at 1.3650 and above attention would turn to the 20-day Simple Moving Average at 1.3697.
After BoC, now FOMC and job data
Monthly GDP data in Canada came in above expectation with an expansion of 0.1% (consensus: 0%). “GDP registered slightly above expectations in August with a one tick increase. This rise was led by the services industry with gains stemming in part from retail and wholesale trade. The increase in retail outlays is likely to be short‑lived as consumers contend with a decline in purchasing power and rising interest bills”, explained analysts at the National Bank of Canada.
After the surprise dovish rate hike from the Bank of Canada on Wednesday, attention is back on economic numbers. Next week, the Canadian employment report is due on Friday. Also, the US will release employment numbers for October.
The key event in the US will be the FOMC meeting. On Wednesday, the central bank is expected to announce a 75 basis points rate hike. Market participants will look for clues about the next steps of the Fed and those expectations will likely define the direction of the US dollar.
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.