USD/CAD bulls gear down near 1.3900

USD/CAD stabilizes ongoing recovery near 1.3900.
Short-term bias is positive, but bulls may soon lose steam.

Christina Parthenidou XM

USD/CAD extended its post-Christmas rally to a one-month high of 1.3887 on Thursday, retracing half of the November–December decline as the US dollar strengthened and traders reduced exposure to risk-sensitive currencies such as the loonie.

With attention shifting to the US and Canadian jobs data and a possible Supreme Court ruling on Trump’s import tariffs, traders are watching the 1.3890–1.3900 zone, where the 50- and 200-day simple moving averages (SMAs) are converging. A break higher could target the 61.8% Fibonacci level at 1.3945 and potentially the 1.4000 psychological mark, with the broken support trendline at 1.4040 likely coming next on the radar.

However, upside momentum may fade as the stochastic oscillator is leaning to the downside in the overbought territory and the price itself is trading around the upper Bollinger band. Failure to clear 1.3900 could see support tested at 1.3815, with further losses exposing the 20-day SMA at 1.3755. If the latter gives way too, the bears may next head for the crucial 2023 support trendline seen near 1.3680.

Overall, USD/CAD is maintaining a positive short-term bias, though profit-taking may limit gains near the 1.3900 area.

Author

Christina Parthenidou

Christina joined the XM investment research department in May 2017. She holds a master degree in Economics and Business from the Erasmus University Rotterdam with a specialization in International economics.

EUR/USD flat lines below 1.1900; divergent Fed-ECB expectations offer support

The EUR/USD pair struggles to capitalize on the overnight bounce from the 1.1835-1.1830 region and oscillates in a narrow band during the Asian session on Thursday. Spot prices currently trade around the 1.1875 area, remaining nearly unchanged for the day and staying within striking distance of an over one-week high, reached on Tuesday, amid mixed cues.

GBP/USD slips heading into the Thursday trading window

The Pound Sterling pulled back from four-year highs on Wednesday, weighed down by a combination of Bank of England dovishness and UK political uncertainty, even as the US Dollar weakened on soft labor market revisions.

Gold holds losses near $5,050 despite renewed USD selling

Gold price trades in negative territory near $5,050 in Thursday's Asian session. The precious metal faces headwinds from stronger-than-expected US employment data, even as the US Dollar sees a bout of fresh selling. All eyes now remain on the next batch of US labor statistics.

Crypto trades through a confidence reset

The cryptocurrency market is navigating a liquidity-driven reset rather than a narrative-driven rally. Bitcoin, Ethereum and major altcoins remain under pressure even as new exchange-traded fund filings continue and selected inflow days appear on the tape.

The market trades the path not the past

The payroll number did not just beat. It reset the tone. 130,000 vs. 65,000 expected, with a 35,000 whisper. 79 of 80 economists leaning the wrong way. Unemployment and underemployment are edging lower. For all the statistical fog around birth-death adjustments and seasonal quirks, the core message was unmistakable. The labour market is not cracking.

XRP sell-off deepens amid weak retail interest, risk-off sentiment

Ripple (XRP) is edging lower around $1.36 at the time of writing on Wednesday, weighed down by low retail interest and macroeconomic uncertainty, which is accelerating risk-off sentiment.