At a rate of 1.31417, the USDCAD pair continues to face downward pressure, reaching its lowest point for the week. This is a reversal of the slight recovery it experienced on Friday after hitting its lowest point in 10 months.

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• USD/CAD remains pressured at weekly low, reversing Friday’s bounce off 10-month low.

The pair currently trades last at 1.31417.

The previous day high was 1.3193 while the previous day low was 1.3156. The daily 38.2% Fib levels comes at 1.317, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.3179, expected to provide resistance.

USD/CAD bears cheer the US Dollar’s retreat from the weekly high amid sluggish Oil prices early Thursday morning in Europe. That said, the Loonie pair drops for the fourth consecutive day to around 1.3145 by the press time, after refreshing the weekly low with the 1.3133 figure. In doing so, the quote consolidates Friday’s stellar rebound from the lowest levels since September 2022.

US Dollar Index (DXY) drops 0.25% intraday to retest the 100.00 round figure while snapping a two-day rebound from the lowest level since April 2022. With this, the greenback justifies the previous day’s downbeat US housing data and mixed concerns about the Fed, as well as ignores the optimism at the US banks.

US Building Permits for June marked a contraction of 3.7% versus the previous increase of 5.6% (revised) whereas the Housing Starts also slumped 8.0% for the said period from 15.7% revised prior. Though the previously released slower growth of the US Retail Sales for June contrasted with promising details to defend the Federal Reserve in keeping the rates higher for longer, as well as help in announcing a 0.25% rate hike in July. The same triggered the US Dollar’s corrective bounce off the 15-month low on Tuesday and helped defend the recovery on Wednesday, ahead of the latest retreat.

On the other hand, WTI crude oil remains indecisive near $75.40 as it struggles for clear directions after reversing from a one-week high the previous day. The black gold’s latest inaction could also be linked to the dual between the lesser-than-expected inventory draw and the softer US Dollar.

Elsewhere, the fresh fears of the US-China tussles, emanating from the comments of China diplomat and the US House of Representatives move concerning outbound investments and AI chips, seem to prod the USD/CAD bears of late.

It should be noted that the mixed concerns about the Federal Reserve’s (Fed) move in 2023, even as the July rate hike is confirmed, contrast with the Bank of Canada’s (BoC) hawkish bias to keep the USD/CAD bears hopeful.

Looking ahead, second-tier employment and housing clues from the US and Canada may entertain intraday traders of the USD/CAD pair ahead of Friday’s Canadian Retail Sales and the next week’s key Federal Reserve (Fed) monetary policy meeting. It’s worth noting that headlines surrounding the Fed and China will also direct short-term moves of the Loonie pair and are worth observing.

Despite the USD/CAD pair’s latest weakness, a three-week-old bullish triangle formation, currently between 1.3110 and 1.3205, challenges the sellers amid steady RSI and sluggish MACD signals.

Technical Levels: Supports and Resistances

USDCAD currently trading at 1.3146 at the time of writing. Pair opened at 1.3164 and is trading with a change of -0.14% % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.322, 50 SMA 1.3346, 100 SMA @ 1.3459 and 200 SMA @ 1.3482.

The previous day high was 1.3193 while the previous day low was 1.3156. The daily 38.2% Fib levels comes at 1.317, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.3179, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.3148, 1.3133, 1.3111
• Pivot resistance is noted at 1.3186, 1.3209, 1.3224

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