USD/CAD Exchange Rate Prediction – The Dollar Drops on Soft Claims Data
The dollar eased as U.S. Treasury yields declined in the wake of the softer than expected Jobless Claims. The Fed also kept monetary policy unchanged and said if the recovery in the United States continued to remain on track, they would consider removing some accommodation. Additionally, the PMI composite reported by IHS Market showed weaker than expected manufacturing and services.
The dollar eased against the Loonie for a second consecutive trading session following the Fed Decision. The exchange rate sliced through support which is now resistant near the 10-day moving average at 1.2713 and is poised to test targets support near the 50-day moving average at 1.2613. The exchange moved from the overbought territory as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned negative the MACD (moving average convergence divergence) index generated a crossover sell signal. The MACD histogram is printing in negative territory with a rising trajectory which points to a higher exchange rate.
Jobless Claims Rise More than Expected
Initial claims for the week ended September 18 totaled 351,000, an increase from the previous week’s upwardly revised 335,000 and above expectations of 320,000. The total was the highest since the week of August 21. Continuing claims data, which runs a week behind, also increased, rising 181,000 to total more than 2.84 million.