On Thursday, the USD/CAD currency pair pulled back from the session highs of about 1.3689 to trade at about 1.3583. The currency pair trades within a descending channel formation in the 60-minute chart.
The pair has now fallen to trade several levels below the 100-hour moving average line. As a result, the currency pair has since plummeted into the oversold levels of the 14-hour RSI.
USD/CAD Fundamentals Overview
From a fundamental perspective, the USD/CAD currency pair trades during a relatively busy period in both markets. In Canada, the Bank of Canada chose to keep the base interest rate unchanged at 2.25%, as expected. The country’s gross domestic product for February matched the (MoM) forecast of 0.2%. Traders will be waiting for Canada’s S&P Global Manufacturing PMI data for April on Friday.
In the US, the initial jobless claims for last week came in lower than expected, with 189k versus a forecast of 215k, down from the previous week’s equivalent of 215k. Personal income for March also came in better than expected, with a (MoM) change of 0.6% versus a forecast of 0.3%, while personal spending matched the forecasted change of 0.9%. The Chicago Purchasing Managers’ Index for April fell short of the forecasted reading of 53, with a reading of 49.2, down from the previous month’s equivalent of 52.8.
Elsewhere, the preliminary annualized US gross domestic product for Q1 fell short of the forecasted change of 2.3%, with a change of 2%, while the preliminary gross domestic product price index for the period fell short of 3.8%, with a change of 3.6%. The employment cost index for the quarter outshone the estimated change of 0.8%, with a change of 0.9%.
USD/CAD Technical Analysis (the 60-min Chart)
Technically, the USD/CAD currency pair trades within a descending channel formation in the 60-minute chart. The 14-hour RSI also supports a bearish bias after entering oversold conditions.
Therefore, the bears will look to extend the latest pullback towards 1.3524 or lower to 1.3471. On the other hand, the bulls will look to pounce on rebounds at about 1.3635 or higher at 1.3689.
USD/CAD Technical Analysis (the Daily Chart)
In the daily chart, the USD/CAD currency pair trades within a descending channel formation. The 14-day RSI also supports a long-term bearish bias as it edges closer to oversold conditions.
Therefore, the bears will look to stretch the current run of declines toward 1.3427 or lower to 1.3275. On the other hand, the bulls will look to pounce on rebounds at about 1.3735 or higher at 1.3874.
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