Canadian Dollar looking for fresh upside against the USD

Loonie is tracking crude barrel prices, USD closely.
Canada GDP is expected to see sluggish growth.
Canadian inflation remains sticky, keeping the BoC on its toes.

Joshua Gibson FXStreet

The Canadian Dollar (CAD) is seeing minor gains against the US Dollar (USD) on Thursday as the Greenback eases off from recent gains. With Oil barrel prices also taking a quick breather, and crude Canada’s main export, the CAD is seeing limited momentum. The USD/CAD is largely flat for Thursday, down a scant 0.2% at its lowest point as the pair threatens consolidation near 1.3500.

Canada's economic data remains thin on the calendar, with Friday’s Gross Domestic Product (GDP) figures closing out an otherwise data-empty trading week. Canadian GDP for the month of July is forecast to print a meager 0.1% versus the previous month’s -0.2%. Oil prices and the broad-market US Dollar Index (DXY) are set to remain the CAD’s main drivers on the charts.

Daily Digest Market Movers: Canadian Dollar flat as Oil, USD step back

The CAD gained nearly 2.3% against the USD in September, bolstered by scorching Oil prices.
The USD/CAD is currently down 1.5%, with surging DXY winning the head-to-head battle with crude barrel prices in the near term.
Canadian GDP is seen struggling to firm up growth as stubborn inflation remains.
Bank of Canada (BoC) officials have been routinely hitting the wires trying to jawbone inflation lower with threats of higher interest rates.
The BoC’s Governor Macklem and Deputy Governor Kozicki have made appearances, reiterating calls for rates to remain higher for longer as inflation still remains too high.
Canada was the world’s second-largest oil exporter in Dollar-adjusted terms, exporting over $120 billion USD of crude in 2022, nearly 9% of the entire global oil export market.
One of the top oil exporting countries globally, the Loonie sees a majority of its momentum dictated by barrel prices.

Technical Analysis: Canadian Dollar struggling to hold onto 1.35

The Canadian Dollar (CAD) has gained against the US Dollar (USD) from September’s peak in the USD/CAD near 1.3695, and is set to close out the month near where it started at 1.3500, if directional momentum remains elusive heading into the final days of September’s trading.

The USD/CAD is set to close near flat for Thursday's trading session, near 1.3500 with oil-push and USD-pull both receding simultaneously. Intraday action saw the pair bounce from the 200-hour Simple Moving Average (SMA) near 1.3480, with the day's low marked in around 1.3470.

The USD/CAD is currently pinned to the 34-day Exponential Moving Average (EMA) at the 1.3500 handle, with near-term support from the 200-day Simple Moving Average near 1.3450. A floor is priced in from the last swing low into 1.3380, while 1.3650 remains a significant technical resistance barrier that has rejected price action multiple times this year.

Here's what you need to know on Friday, September 29:

During the Asian session, Japan will release critical economic reports including the September Tokyo Consumer Price Index, the August Unemployment Rate, Industrial Production, Retail Sales, and Housing Starts. In Australia, Private Sector Credit data is due. Later in the day, a new estimate of UK Q2 GDP and Consumer Credit will be reported, while Germany will release Retail Sales and the Unemployment Rate. The key report to watch will be the Eurozone CPI. The focus will then shift to the US Core Personal Consumption Expenditures and Canada's monthly GDP.

Check it out!

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.