USD/CAD Remains in a Range as The Canadian Dollar Retreats

The dollar remains within a range against the Canadian dollar. The US ten-year yield holds near 1.97% as investors monitor the Fed’s next move. Gold prices dip slightly despite reaching their third weekly gain, as hopes of US-Russia talks take pressure off of the markets. St. Louis Fed President James Bullard warned that inflation could turn into a more serious issue without taking action to tighten rates.

Technical Analysis

The USD/CAD is rangebound against the Loonie. Resistance is seen near a downward-sloping trend line near 1.28. The exchange rate broke below the former support level seen near the 50-day moving average near 1.27. However, the former support level may become support again. Support is seen near an upward-sloping trend line from the February lows of 1.265. Short-term momentum turned positive as the fast stochastic generates a crossover buy signal. The reading prints 72.57, above the overbought trigger level of 70. Medium-term momentum is positive as the MACD (moving average convergence divergence) index generates a crossover buy signal, but momentum decelerates. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) converges to the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory with a downward sloping trajectory.

January US Existing Home Sales Accelerated

January US existing homes sales increased by 6.7%, beating economists’ expectations. The readings exceeded December home sales, revised down to 6.09 million from 6.18 million. Economists’ expectations were a 1.3% decline to 6.1 million units. Rising prices caused an increase throughout each region. In January, the median existing-home price was $350,300 for all housing types, up 15.4% from the previous year’s ($303,600).