USD/CAD Price Analysis: Finds an intermediate cushion below 1.3550, US/Canada PMI in focus

USD/CAD has found short-term support below 1.3550 after a vertical sell-off.
A power-pack action is anticipated amid the release of US/Canada Manufacturing PMI figures.
USD/CAD has slipped significantly after facing immense selling pressure from 61.8% Fibo retracement.

Sagar Dua FXStreet

The USD/CAD pair has gauged an intermediate cushion below 1.3550 after a vertical sell-off from the weekly high of 1.3668. The Loonie asset is building a base ahead of the Manufacturing PMI data from Canada and the United States ahead.

S&P500 settled Friday’s session on a bullish note as consistent consumer spending and upbeat quarterly figures from technology stocks infused confidence in investors. Investors could show some traits of pre-Federal Reserve (Fed) policy anxiety ahead.

The US Dollar Index (DXY) has rebounded after dropping to near 101.50 and is looking to extend its recovery above 101.70 as the Fed is expected to raise interest rates one more time by 25 basis points (bps).

USD/CAD has slipped significantly after facing immense selling pressure from 61.8% Fibonacci retracement (placed from March 10 high at 1.3862 to April 14 low at 1.3301) at 1.3650 on a four-hour scale. It seems that the strength in the selling pressure was extremely high as it dragged the Loonie asset sharply below the 20-and 50-period Exponential Moving Averages (EMAs) at 1.3590 and 1.3566 respectively.

Meanwhile, the Relative Strength Index (RSI) (14) has shifted into the 40.00-60.00 range from the bullish range of 60.00-80.00. The RSI (14) is struggling to maintain the 40.00 support as a break below the same will strengthen the Canadian Dollar.

Going forward, a decisive break below the intraday low at 1.3533 will expose the asset to psychological support at 1.3500 followed by a 23.6% Fibo retracement at 1.3438.

On the flip side, a recovery move above the 61.8% Fibo retracement at 1.3650 will trigger a reversal and will drive the major toward the round-level resistance at 1.3700. A break above the same will expose the asset to March 22 high at 1.3745.

USD/CAD four-hour chart

USD/CAD

Overview
Today last price	1.3552
Today Daily Change	0.0000
Today Daily Change %	-0.00
Today daily open	1.3552

Trends
Daily SMA20	1.3484
Daily SMA50	1.3585
Daily SMA100	1.3527
Daily SMA200	1.3429

Levels
Previous Daily High	1.3668
Previous Daily Low	1.3536
Previous Weekly High	1.3668
Previous Weekly Low	1.3523
Previous Monthly High	1.3862
Previous Monthly Low	1.3508
Daily Fibonacci 38.2%	1.3586
Daily Fibonacci 61.8%	1.3618
Daily Pivot Point S1	1.3502
Daily Pivot Point S2	1.3453
Daily Pivot Point S3	1.3371
Daily Pivot Point R1	1.3634
Daily Pivot Point R2	1.3717
Daily Pivot Point R3	1.3766

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.