The USDCAD reached a peak of 1.3270 and then settled down at 1.3235.
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- USD/CAD jumped to a high of 1.3270 before stabilizing at 1.3235.
The pair currently trades last at 1.32290.
The previous day high was 1.3229 while the previous day low was 1.3179. The daily 38.2% Fib levels comes at 1.321, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3198, expected to provide support.
On Tuesday, the Loonie lost traction amid a cautious market mood following the decision by the People’s Bank of China to cut its main key rates by 10 basis points. Spurred by the cut, Oil prices plunged due to fears of a global economic downturn. On the other hand, the USD held its ground thanks to upbeat US Housing market data.
During the Asian session, the People’s Bank of China made an announcement to decrease the benchmark Loan Prime Rates (LPRs) by 10 basis points (bps). This decision resulted in the one-year LPR declining from 3.65% to 3.55%, while the five-year LPR was reduced from 4.30% to 4.20%. These rate cuts served as a reminder to investors of the sluggishness of Chinese economic activity, and as Oil prices tend to be positively correlated with the health of the main world economies, they plunged more than 1.50%. In that sense, as Canada is a large Oil producer, the CAD weakened.
On the other hand, the US Census Bureau’s May Housing Starts data surpassed expectations with a significant increase of 21.7%, outperforming the anticipated 0.8% decline. Similarly, Building Permits for the same month exceeded consensus by rising 5.2% instead of the expected 5% fall, helping the USD hold its ground as the DXY index trades with gains at the 102.55 area.
Reacting to the PBoC decision and US data, the US bond yields weakened across the curve, signaling a cautious market mood. The 10-year bond yield fell to 3.73%, while the 2-year yield sits at 4.69% and the 5-year at 3.96% – all three with more than 1% declines that limits the USD’s upside.
The technical analysis of the daily chart indicates a neutral to bullish stance for the USD/CAD in the short term. While buyers have shown some strength, they have yet to overcome the negative territory. The Relative Strength Index (RSI) currently sits below its midpoint, but shows a positive slope while the Moving Average Convergence Divergence (MACD) depicts decreasing red bars, suggesting a waning selling momentum.
Upcoming resistance for USD/CAD is seen at the 1.3270 (daily high) zone, followed by the psychological mark at 1.3300 and the 1.3350 area. On the other hand, on the downside, the next support levels to watch are the 1.3200 level, followed by the cycle low at 1.3180 and the 1.3150 area.
Technical Levels: Supports and Resistances
USDCAD currently trading at 1.3236 at the time of writing. Pair opened at 1.321 and is trading with a change of 0.2 % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 1.3236 |
| 1 | Today Daily Change | 0.0026 |
| 2 | Today Daily Change % | 0.2000 |
| 3 | Today daily open | 1.3210 |
The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.3428, 50 SMA 1.3463, 100 SMA @ 1.351 and 200 SMA @ 1.352.
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 1.3428 |
| 1 | Daily SMA50 | 1.3463 |
| 2 | Daily SMA100 | 1.3510 |
| 3 | Daily SMA200 | 1.3520 |
The previous day high was 1.3229 while the previous day low was 1.3179. The daily 38.2% Fib levels comes at 1.321, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3198, expected to provide support.
Note the levels of interest below:
- Pivot support is noted at 1.3183, 1.3156, 1.3133
- Pivot resistance is noted at 1.3233, 1.3256, 1.3282
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 1.3229 |
| Previous Daily Low | 1.3179 |
| Previous Weekly High | 1.3384 |
| Previous Weekly Low | 1.3178 |
| Previous Monthly High | 1.3655 |
| Previous Monthly Low | 1.3315 |
| Daily Fibonacci 38.2% | 1.3210 |
| Daily Fibonacci 61.8% | 1.3198 |
| Daily Pivot Point S1 | 1.3183 |
| Daily Pivot Point S2 | 1.3156 |
| Daily Pivot Point S3 | 1.3133 |
| Daily Pivot Point R1 | 1.3233 |
| Daily Pivot Point R2 | 1.3256 |
| Daily Pivot Point R3 | 1.3282 |
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