USDCAD – US Dollar Testing Crucial Support Vs Canadian Dollar
Aayush Jindal
Key Highlights
The US Dollar declined this week below 1.3350 against the Canadian dollar, and remained under a bearish pressure.
The USDCAD pair recently bounced from a major bullish trend line with support near 1.3210 on the daily chart.
Recently in Canada, the New Housing Price Index (NHPI) for Feb 2017 released by the Statistics Canada posted an increase of 0.4% (MoM).
The Manufacturing Shipment posted a decline of 0.2% in March 2017, compared with the forecast of -0.7%.
USDCAD Technical Analysis
The US Dollar was under pressure throughout this week against the Canadian dollar, as it moved below 1.3350. Now, the USDCAD pair is trading above a major support at 1.3200, which can ignite a recovery.During the downside move, the pair broke the 23.6% Fib retracement level of the last wave from the 1.2968 low to 1.3536 high. It also moved below the 100-day simple moving average at 1.3280, but later recovered.Recently, the pair traded close to a major bullish trend line with support near 1.3210 on the daily chart. It held the downside, and pushed the pair back towards 1.3300. The same trend line support holds a lot of importance in the near term.
Canada’s New Housing Price Index (NHPI)
Recently in Canada, the New Housing Price Index (NHPI) for Feb 2017 was released by the Statistics Canada. The market was aligned for the NHPI to increase by 0.2% in Feb 2017, compared with the previous month.The real outcome was better, as the New Housing Price Index posted an increase of 0.4% in Feb 2017. In terms of the yearly change, there was a rise of 3.3%, more than the last +3.1%. Speaking of the Manufacturing Shipment, there was a decline of 0.2% in March 2017, less than the forecast of -0.7%.The report stated that:
The largest declines were in the motor vehicle assembly and petroleum and coal product manufacturing industries. However, these decreases were largely offset by gains in the aerospace products and parts, primary metal and machinery industries.
The results were better than the forecast, but still on the negative side, which ignited a minor recovery in USDCAD.
Economic Releases to Watch Today
US Consumer Price Index March 2017 (MoM) – Forecast 0%, versus +0.1% previous.
US Consumer Price Index March 2017 (YoY) – Forecast +2.6%, versus +2.7% previous.
US Consumer Price Index Ex Food & Energy March 2017 (YoY) – Forecast +2.3%, versus +2.2% previous.
US Retail Sales March 2017 (MoM) – Forecast +0.3%, versus +0.1% previous.
During the downside move, the pair broke the 23.6% Fib retracement level of the last wave from the 1.2968 low to 1.3536 high. It also moved below the 100-day simple moving average at 1.3280, but later recovered.Recently, the pair traded close to a major bullish trend line with support near 1.3210 on the daily chart. It held the downside, and pushed the pair back towards 1.3300. The same trend line support holds a lot of importance in the near term.
The real outcome was better, as the New Housing Price Index posted an increase of 0.4% in Feb 2017. In terms of the yearly change, there was a rise of 3.3%, more than the last +3.1%. Speaking of the Manufacturing Shipment, there was a decline of 0.2% in March 2017, less than the forecast of -0.7%.The report stated that: