USDCAD, M30
Canada retail sales grew only 0.1% in September after a revised 0.1% drop (was -0.3%) in August. The ex-auto retails sales aggregate improved 0.3% following a 0.4% drop (was -0.7%). The gain in total sales and the ex-autos sales aggregate fell well short of expectations. Sales volumes fell 0.6% in September. This is disappointing report vaulted upwards USDCAD.
The USDCAD perked up by 50 pips higher, up to 1.2725 high, since settling around 1.2712-15. Thin conditions, with the U.S. out, have exacerbated the magnitude of movement. USDCAD had earlier clocked a 10-day low at 1.2672, amid broader weakness in the U.S. dollar. The data accompanies recent BoC policymaker guidance emphasizing that there is no rush to continue with its gradual tightening cycle, though with the U.S. dollar under broad pressure there may be limited potential for USDCAD to sustain upside direction.
In the 30 Minutes chart, momentum indicators are turning lower again, after positive configuration on data announcement. However Dollar weakness seen since yesterday, helps loonie gaining ground against US dollar despite the weak data. The short-term RSI and Stochastic look oversold, pushing below 80. In higher time-frames such as hourly and 4-hourly ones, momentum indicators confirm that downside momentum is still strong, with RSI and Stochastics below neutral and MACD being negative since Tuesday.
Despite the strong positive candle posted on data release, the pair turned lower after testing a resistance at 23.6 Fibonacci level since September at 1.2725. Hence price action along with the USD weakness and with the acceleration lower of momentum indicators, suggest intra day bearish movement, towards support levels at at 1.2670-80.
Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.
Recommended Content
Editors’ Picks
EUR/USD fluctuates near 1.0700 after US data
EUR/USD stays in a consolidation phase at around 1.0700 in the American session on Wednesday. The data from the US showed a strong increase in Durable Goods Orders, supporting the USD and making it difficult for the pair to gain traction.
USD/JPY refreshes 34-year high, attacks 155.00 as intervention risks loom
USD/JPY is renewing a multi-decade high, closing in on 155.00. Traders turn cautious on heightened risks of Japan's FX intervention. Broad US Dollar rebound aids the upside in the major. US Durable Goods data are next on tap.
Gold keeps consolidating ahead of US first-tier figures
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Worldcoin looks set for comeback despite Nvidia’s 22% crash Premium
Worldcoin price is in a better position than last week's and shows signs of a potential comeback. This development occurs amid the sharp decline in the valuation of the popular GPU manufacturer Nvidia.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.