USD/CAD congestion thinning out

Ross J Burland FXStreet

FXStreet (Guatemala) - USD/CAD is trading at 1.0820, down -0.14% on the day, having posted a daily high at 1.0844 and low at 1.0806.

USD/CAD is pressing lower again through the consolidation and congestion in the 30 pip range from the handle. Looking ahead, Canada's CPI for May is released along with April retail sales. RBS strategists explained that after base effects helped boost headline inflation in April, they see the risks favouring a slightly weaker than consensus result in May. “Either way, the June statement indicated the Bank of Canada appears fully committed to looking through near-term inflation pressure amid a still tepid growth outlook. The sales impact of the late Easter may lead to a boost in April Canadian retail sales. While USD/CAD has tested the 2014 lows, short term interest rate support has moved in favour of the USD over the past few weeks. (see chart in attached pdf) The positive carry environment, and still negative CAD positioning, may keep the CAD supported but we are cautious on chasing CAD gains further from current levels, particularly as rate differentials have moved against it. We are neutral on at current levels, with a medium-term bias to sell CAD”.

USD/CAD Levels

With spot trading at 1.0820, we can see next resistance ahead at 1.0830 (Hourly 20 EMA), 1.0833 (Yesterday's Low), 1.0835 (Daily Open), (Monthly Low) and 1.0835 (Weekly Low). Support below can be found at 1.0814 (Weekly Classic S1), 1.0813 (Daily Classic S1), 1.0806 (Daily Low), 1.0790 (Daily Classic S2) and 1.0777 (Daily 200 SMA).

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD hangs near three-week low, below 0.6950 as traders await US NFP report

AUD/USD hits a three-week low during the Asian session on Friday as the RBA’s dovish shift and a rout in equity markets weigh on the risk-sensitive Aussie. However, the recent slump in US bond yields to a two-month low keeps US Dollar bulls on the back foot and limits losses for the currency pair as traders look to the US NFP report for a fresh impetus.

USD/JPY bounces off three-week low; keeps the red near 157.65 as focus remains on US NFP

USD/JPY bounces off the weekly low set during the Asian session, as bears turn cautious ahead of the US NFP report due later this Friday. The upside seems limited as the recent slump in US bond yields and hopes of Iran war de-escalation undermine the US Dollar. Moreover, a hawkish BoJ and intervention risks support the Japanese Yen, capping the pair.

Gold loses the grip; $4,000 comes next on the downside

Gold sets aside two daily advances in a row on Friday, opening the door to a potential test of the key $4,000 mark per troy ounce. The precious metal’s retracement follows a decent improvement in the sentiment surrounding the US Dollar, solid NFP data and higher US Treasury yields across the board.

Democrats win House and Senate in US midterms: Why isn’t all bad news for crypto

The biggest story this week was Tuesday’s US midterm elections, which saw Democrats win control of both the House and the Senate in a clear blue wave. This political shift in the US has triggered sharp price swings across the cryptocurrency market.

Week ahead – Inflation and geopolitics in focus as US political landscape shifts

Post-midterm election euphoria fizzles out as risk aversion prevails. US CPI, PPI and Fedspeak on the radar as Fed hike bets remain supported. Oil retreat pauses on mixed hopes about the ongoing conflicts.

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.