USD/CAD fades bounce off multi-month low above 1.2100, BOC’s Macklem eyed

  • USD/CAD retreats from weekly top, refreshes intraday low.
  • Market sentiment dwindles after US inflation unveiled challenges for Fed, US government.
  • WTI trims early-day losses amid geopolitical tension in the Middle East.
  • BOC’s Macklem, US PPI, Jobless Claims can direct short-term moves, risk catalysts be the key.

USD/CAD fizzles corrective pullback, marked the previous day, while dropping back towards the 1.2100 threshold, down 0.10% intraday to 1.2122 during Thursday’s Asian session. In doing so, the Loonie pair consolidates the recent gains amid less active hours joining light macros.

The quote reversed from the early 2017 lows on Wednesday after the US Consumer Price Index (CPI) raised questions about the future monetary policy actions of the US Federal Reserve (Fed) as well as the government’s fiscal stimulus. Following the release of the highest CPI since 2008, a few Fed policymakers tried to placate market bears but failed as CNN broke the news of a leading Democratic economist Larry Summers warning the White House on the ‘overheating’ issue.

Also weighing down the quote could be the recent pick-up in oil prices. WTI trims early Asian losses after escalating Israel-Palestine tussle joined the market’s consolidation amid a light calendar.

Amid these plays, S&P 500 Futures print mild gains but the US dollar index (DXY) keeps the reins near the monthly top.

Looking forward, the US weekly Jobless Claims and Producer Price Index (PPI) will be watched for more clues to the previous day’s challenging inflation figures. It should, however, be noted that Friday’s US Retail Sales and Michigan Consumer Sentiment Index will be the key. Should the incoming US data keeps reflation fears intact, the USD/CAD may portray the much-awaited bounce.

At home, the Bank of Canada (BOC) Governor Tiff Macklem is up for a speech at an online event hosted by the central bank. Although Macklem may not leave his bullish bias behind, inflation fears may help USD/CAD to extend the bounce.

Technical analysis

Failures to cross the 5-day EMA level of 1.2135, not to mention the two-month-old support-turned-resistance line near 1.2230, keep USD/CAD sellers hopeful to meet the 1.2000 psychological magnet.

Additional important levels

Today last price 1.2122
Today Daily Change 20 pips
Today Daily Change % 0.17%
Today daily open 1.2102
Daily SMA20 1.2361
Daily SMA50 1.2482
Daily SMA100 1.2602
Daily SMA200 1.2861
Previous Daily High 1.2126
Previous Daily Low 1.2078
Previous Weekly High 1.2352
Previous Weekly Low 1.2122
Previous Monthly High 1.2654
Previous Monthly Low 1.2266
Daily Fibonacci 38.2% 1.2108
Daily Fibonacci 61.8% 1.2097
Daily Pivot Point S1 1.2078
Daily Pivot Point S2 1.2054
Daily Pivot Point S3 1.203
Daily Pivot Point R1 1.2126
Daily Pivot Point R2 1.215
Daily Pivot Point R3 1.2174



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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD struggles around 1.19 amid Fed-fueled dollar strength

EUR/USD is under pressure around 1.19, as the dollar remains on the offensive following the Federal Reserve's hawkish decision on Wednesday. The bank is set to debate cutting down its bond buys and signaled raising rates sooner than anticipated. 


GBP/USD tumbles below 1.39 on weak UK data, dollar strength

GBP/USD has been extending its decline, sliding under 1.39. UK retail sales disappointed with -1.4% in May and the rapid spread of the Delta variant in the UK is also weighing on sterling. The US dollar remain robust after the Fed's hawkish decision.


GBP/USD tumbles below 1.39 on weak UK data, dollar strength

GBP/USD has been extending its decline, sliding under 1.39. UK retail sales disappointed with -1.4% in May and the rapid spread of the Delta variant in the UK is also weighing on sterling. The US dollar remain robust after the Fed's hawkish decision.


Ripple fears of a major decline are unwarranted

XRP price remains locked in a range between the psychologically important $1.00 and the neckline of a multi-year inverse head-and-shoulders pattern at $0.76. However, a lack of technical clues leaves frothy forecasts on the sideline until directional confirmation can be gleaned from the charts.

Read more

Where next for markets after the Fed shocker

The Fed surprised markets with an abrupt hawkish shift that has triggered substantial volatility in currency markets. Valeria Bednarik and Yohay Elam explain the surprise, discuss technical level, the next moves in FX and beyond.

Read more