USD/CAD Daily Price Forecast – USD/CAD Breaches 1.29 Handle on Weak US Greenback in Broad Market

Subdued USD demand fails to assist build on overnight rebound , while weak crude oil price helped limit sharp downward slide.
Colin First

The USD/CAD pair struggled to build on overnight modest rebound from multi-day lows and remained capped below the key 1.30 psychological mark. The pair extended last week’s rejection slide from 100-day SMA and was kept losing ground for the third consecutive session on Monday. A combination of factors exerted some heavy downward pressure and dragged the pair to an intraday low level of 1.2955. As of writing this article, the USDCAD pair is trading at 1.2960 down by 0.24% on the day. The already weaker US Dollar was further weighed down by the disappointing release of US monthly retail sales data, while the Bank of Canada Business Outlook survey report fueled rate hike expectations and underpinned the Canadian Dollar.

US Job Data Could Help US Greenback Regain Hold Above 1.30 Handle

The pair, however, managed to find some support at lower levels and managed to rebound around 35-pips from daily lows, albeit lacked any strong follow-through amid a subdued USD demand. Meanwhile, a weaker tone around crude oil prices, which tend to dent demand for the commodity-linked Loonie, extended some support and might now help limit any immediate sharp downside, at least for the time being. Hence, it would be prudent to wait for a sustained break in either direction before positioning for the pair’s intraday momentum amid relatively thin economic docket. On release front, Canadian market saw dovish readings in Foreign Securities Purchases (Aug) while US market is yet to see macro updates for the day.

Today’s calendar in US market is scheduled to release JOLTS Job Opening data which has hawkish forecast while Industrial and Manufacturing production data are also scheduled to release for the day but aren’t expected to provide much impact to Greenback’s momentum in broad market.  When looking from technical perspective, the 1.2955-50 zone might continue to protect the immediate downside, below which the pair is likely to accelerate the fall towards testing the very important 200-day SMA support near the 1.2900-1.2895 region. On the flip side, momentum beyond the 1.30 handle is likely to confront fresh supply near the 1.3040-50 regions and is followed by the 100-DMA barrier, currently near the 1.3065 region.


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
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.
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.