#USDCAD @ 1.34481 picks up bids to refresh intraday high and approach three-week-old resistance line. (Pivot Orderbook analysis)

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• USD/CAD picks up bids to refresh intraday high and approach three-week-old resistance line.
• Hawkish Fed concerns underpin US Dollar rebound, weigh on Oil price.
• BoC’s Macklem contrasts with hawkish Fed comments and advocates a pause in rate hike trajectory.

The pair currently trades last at 1.34481.

The previous day high was 1.3449 while the previous day low was 1.336. The daily 38.2% Fib levels comes at 1.3415, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3394, expected to provide support.

USD/CAD remains on the front foot for the second consecutive day, extending the previous day’s rebound from the weekly low to refresh the intraday top near 1.3455 during early Thursday. In doing so, the Loonie pair justifies the divergence between the monetary policy outlook at the Bank of Canada (BoC) and the US Federal Reserve (Fed). Also fuelling the quote could be the latest weakness in the Oil price, Canada’s key exports, as well as the mixed sentiment.

On Wednesday, the BoC released its monetary policy meeting minutes for the first time and highlighted the growing discussions among the policymakers to pause the rate hikes. On the same line, BoC Governor Tiff Macklemd asked for time to gauge how households and businesses adapt to higher rates before further moves. The policymaker also said, “Rate hikes have hit homeowners hard.”

Elsewhere, Fed Governor Christopher Waller teased a long fight with a 2.0% inflation target by citing expectations of tighter monetary policy for longer than expected. New York Federal Reserve President John Williams was almost on the same line while saying that the labor market is still very strong and noted that they have more work to do on rates, adding data will determine the path of rate hikes. Fed Governor Lisa Cook said that the central bank remains focused on restoring price stability, as inflation is still running too high. She added that they would need a restrictive monetary policy for some time.

It’s worth noting that the US diplomats were also highlighting concerns that defend the higher Fed rates and fuel the USD/CAD price. Among them, US Treasury Secretary Janet Yellen mentioned, “While inflation remained elevated, there were encouraging signs that supply-demand mismatches were easing in many sectors of the economy.” Elsewhere, US President Joe Biden said during a PBS interview that there will be no US recession in 2023 or 2024.

On a different page, easing fears surrounding the US and China joins the firmer US Dollar Index (DXY) to weigh on the Oil prices, down 0.05% around $78.50 by the press time, which in turn allows the USD/CAD buyers to keep the reins.

Moving on, no major data/events are there for publishing on the calendar and hence the central bankers’ comments, as well as other risk catalysts, will be important for the USD/CAD pair traders to watch for clear directions.

USD/CAD pair’s successful trading beyond the convergence of the 50-SMA and a weekly ascending trend line, near 1.3370, keeps buyers hopeful of overcoming the immediate resistance line stretched from January 19 surrounding 1.3470.

Technical Levels: Supports and Resistances

USDCAD currently trading at 1.3456 at the time of writing. Pair opened at 1.3447 and is trading with a change of 0.07% % .

The pair is trading above its 20 Daily moving average @ 1.3383, below its 50 Daily moving average @ 1.3494 , below its 100 Daily moving average @ 1.3536 and above its 200 Daily moving average @ 1.3231

The previous day high was 1.3449 while the previous day low was 1.336. The daily 38.2% Fib levels comes at 1.3415, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3394, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.3389, 1.333, 1.33
• Pivot resistance is noted at 1.3478, 1.3508, 1.3567

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