Canadian Dollar Flirts with 1.33, GDP LoomsThe Canadian dollar is flat on Thursday. The lack of movement could change on Friday, with the release of Canadian GDP. EUR/GBP has posted slight gains, but the pair continues to put pressure on a key support level.
USD/CAD is showing little movement on Thursday. In the North American session, the pair is trading at 1.3289, up 0.02% on the day.
Ahead – Canadian GDP
With no events out of the U.S. on Friday, Canadian GDP will be in the spotlight. Canada releases GDP on a monthly basis. The Canadian economy has not looked particularly strong in the second half of 2019, with soft GDP releases. In August, GDP posted a weak gain of 0.1%, and the same figure is expected for September. In the U.S., there was positive news from GDP in Q3, as the second estimate came in at 2.1%, up from 1.9% in the initial release. A stronger U.S. economy is good news for the Canadian dollar, as most Canadian exports go to the U.S.
There is immediate resistance at 1.3300. Although this line is under pressure, it has proven surprisingly resilient, as it was last tested on October 9th. If the pair can break above this line, it has room to climb all the way to 1.3385, which is the next line of resistance.
On the downside, there is support at 1.3250. The 200-EMA and 50-EMA lines follow closely – the 200-EMA is at 1.3237 and the 50-EMA follows at 1.3226. Note that these lines appear headed to a crossover, which could signal a trend reversal.
EUR/GBP has posted slight gains on Thursday. Currently, the pair is trading at 0.8529, up 0.20% on the day.
The pair is showing stronger swings this week, but remains unable to pull away from the 0.8560 line, which has remained relevant since mid-November. After losses on Wednesday, EUR/GBP is also putting pressure on 0.8500. This major support line has not been breached since the end of April, so if the pair breaks below this line, it would be a significant development. Above, we find resistance at 0.8590, followed by resistance at 0.8700.