GBP/USD, USD/CAD, USD/MXN – North American Session Daily Forecast

The currency markets have been quiet on Tuesday, with the pound, Canadian dollar and Mexican peso showing limited movement. However, the Fed meeting on Wednesday could trigger some movement. As well, investors will be keeping a close eye on CPI releases in Canada and the U.K.
Kenny Fisher

GBP/USD

GBP/USD has posted gains on Tuesday, erasing most of the gains seen on Monday. In the North American session, the pair is trading at 1.2485, up 0.47% on the day.

Ahead – U.K. Inflation and Fed Meeting

There are no major indicators on the schedule, so investors are casting an eye ahead towards Wednesday, with key events on both sides of the pond. The U.K. will release the August consumer inflation report. Recent CPI releases have been around the 2.0% level, which is the Bank of England’s inflation target. However, inflation is expected to drop to 1.8% in August, and if CPI falls below this level, the pound could lose ground. As well, investors will be keeping a close eye on the Federal Reserve, which will set the benchmark rate and release a rate statement. Any hints about further rate cuts in 2019 could weigh on the U.S. dollar.

Technical Analysis

Since the start of the week, GBP/USD has hovered close to resistance at 1.2420. However, the pair has tested this line in the North American session. Will we see a clean break past this stubborn line? The pound remains in an area of resistance, with another resistance line at 1.2510. On the downside, there is resistance at 1.2380. This line is not particularly strong and is vulnerable if the pound coughs up Tuesday’s gains.

GBPUSD 1-Hour Chart

USD/CAD

USD/CAD is showing limited movement on Tuesday. In the North American session, the pair is trading at 1.3259, up 0.13% on the day.

Soft Manufacturing Report Weighs on Loonie

Canada posted a weak manufacturing report on Tuesday, disappointing investors. Manufacturing sales declined 1.3% in July, well below expectations. This marked back-to-back declines for the key indicator, and will undoubtedly raise concerns about the health of the manufacturing sector.

Canadian CPI, Fed could Weigh on Loonie

Traders can expect stronger movement from USD/CAD on Wednesday. Canada releases CPI, with the markets braced for a decline of 0.2% in July. The Federal Reserve holds its monthly policy meeting, and a dovish message from rate-setters could rattle investors and push the Canadian dollar lower.

Technical Analysis

USD/CAD remains rangebound this week. The line of 1.3282 remains relevant and is providing weak resistance. On the downside, there is support at the round number of 1.3200.

USD/CAD 4-Hour Chart

USD/MXN

The Mexican peso seems unable to decide what to do, as the pair continues to drift this week. In the North American session, USD/MXN is trading at 19.41, down 0.13% on the day.

Will the Fed Meeting Shake Up Peso?

There are no major U.S. releases until Wednesday, so traders shouldn’t expect fundamentals to have much impact on USD/MXN in Tuesday trade. Investors will be keeping a close eye on the Federal Reserve, which will set the benchmark rate and release a rate statement on Wednesday. Any hints from Fed policymakers about further rate cuts in 2019 could dampen investor risk appetite and weigh on the Mexican peso.

Technical Analysis

The Mexican peso remains rangebound this week. The line of 19.45 remains fluid, and continues to be tested by USD/MXN. There is immediate support at 0.1920, which has held since August 1. On the upside, there is resistance at 19.70. If the pair can muster some strength and push above the 19.45 line, we could see an upward breakout from the pair.

USD/MXN 4-Hour Chart

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US