- The central line may attract the USD/CAD pair.
- Today’s US economic data should be decisive.
- Removing the midline activates more decline.
At the time of writing, the USD/CAD price is trading in the red at 1.3450. With the US dollar weakening, this currency pair seems determined to make new lows.
After the BOC, prices skyrocketed as the Bank of Canada took a dovish stance. On the other hand, the US manufacturing and service industries confirmed expansion.
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Yesterday, the Canadian dollar regained the lead despite the ECB maintaining monetary policy and the US releasing mixed statistics.
US GDP, new home sales, and core durable goods orders exceeded expectations in the first quarter. At the same time, unemployment insurance claims, advance GDP price index, durable goods orders, goods trade balance, and preliminary wholesale inventory figures were disappointing.
US economic data should move the market again today. The core PCE price index is likely to announce a growth of 0.2% against his 0.1% growth in the previous reporting period.
Pending home sales are expected to report growth of 2.1%, higher than the 0.0% growth in the previous reporting period.
In addition, personal spending and personal income data will also be made public. Good economic indicators should help the US dollar dominate the currency market. On the contrary, Greenback may find itself at a significant disadvantage to its rivals.
USD/CAD Price Technical Analysis: Sell Bias
From a technical perspective, the USD/CAD pair has broken out of a significant ascending channel pattern, indicating a possible correction. Price attempted to break above the broken uptrend line, but was unable to stabilize above this dynamic obstacle, confirming exhausted buyers.
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Retesting of the upper midline (uml) confirmed drawing a descending rake. Therefore, prices may be attracted to the median line (ml), which acts like a magnet. Removing this dynamic support opens the door to a larger downside price move. Still, a temporary rebound cannot be ruled out as interest rates challenge the demand zone after the current decline.
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