USD/CAD struggling for direction, awaits key US economic releases

Haresh Menghani FXStreet

The USD/CAD pair seesawed between tepid gains, and losses, and remained confined in a narrow trading band below 1.3100 handle ahead of key economic releases.

Currently trading around 1.3075 region, the pair extended its near-term range-bound price action and struggled for a firm direction despite of a broad based US Dollar strength. The key US Dollar index was seen building on Tuesday's gains to multi-week highs, led by hawkish comments from the Fed Chair Janet Yellen, but failed to lift the pair beyond 1.3100 handle.

Meanwhile, a softer tone around WTI crude oil, which tends to drive demand for the commodity-linked currency - Loonie, has also failed to provide any impetus for the major as market participants keenly await the release of important economic data from the US, CPI print and monthly retail sales data, before determining the next leg of directional move for the major.

Also in focus would be the release of manufacturing sales data from Canada, accompanied by Empire State Manufacturing Index, followed by industrial production and EIA's official crude oil inventories data from the US.

Technical levels to watch

Immediate support is pegged near 1.3050 region below which the pair is likely to head back towards 1.3025 support (yesterday's low) before eventually heading towards 1.30 psychological mark. On the flip side, sustained momentum above 1.3100 handle seems to assist the pair back towards the very important 200-day SMA hurdle near 1.3135-40 region ahead of 1.3185-90 horizontal resistance.

1 Week
1 Month
1 Quarter

1 Week

Avg Forecast 1.3228

89% Bullish
0% Bearish
11% Sideways

Bias Bullish

1 Month

Avg Forecast 1.3248

67% Bullish
0% Bearish
33% Sideways

Bias Bullish

1 Quarter

Avg Forecast 1.3446

83% Bullish
17% Bearish
0% Sideways

Bias Bullish

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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