简体中文
繁體中文
English
Pусский
日本語
ภาษาไทย
Tiếng Việt
Bahasa Indonesia
Español
हिन्दी
Filippiiniläinen
Français
Deutsch
Português
Türkçe
한국어
العربية
Abstract:The rebound in USDCAD appears to be stalling ahead of the US Retail Sales report as the exchange rate fails to extend the recent series of higher highs and lows.
Canadian Dollar Talking Points
The recent rebound in USDCAD appears to be stalling ahead of the US Retail Sales report, and the exchange rate stands at risk of giving back the advance from the monthly-low (1.3238) as it fails to extend the series of higher highs and lows from earlier this week.
USDCAD Rate Rebound Fizzles Ahead of US Retail Sales Report
USDCAD attempts to retrace the sharp decline following the US Non-Farm Payrolls (NFP) report, but the rebound may prove to be short-lived as attention turns to the Federal Reserve interest rate decision on June 19.
It remains to be seen if the US Retail Sales report will keep USDCAD afloat as private-sector spending is anticipated to increase 0.7% in May, and a positive development may encourage the Federal Open Market Committee (FOMC) to retain the current policy as “participants generally agreed that a patient approach to determining future adjustments to the target range for the federal funds rate remained appropriate.”
However, mixed data prints coming out of the economy may push the FOMC to alter the forward guidance for monetary policy as the U. of Michigan Confidence survey is expected to show a dip in household sentiment, and the central bank may show a greater willingness to switch gears later this year as President Donald Trump tweets that “the Fed interest rate way too high.”
In turn, Chairman Jerome Powell and Co. may implement material changes to the Summary of Economic Projections (SEP), and the fresh updates may produce headwinds for the US Dollar should Fed officials forecast a lower trajectory for the benchmark interest rate.
With that said, Fed Fund futures may continue to reflect overwhelming expectations for a September rate-cut, and the current environment may keep USDCAD as the exchange rate snaps the upward trend from earlier this year.
USD/CAD Rate Daily Chart
Near-term outlook for USDCAD is no longer constructive as the advance from the April-low (1.3274) stalls ahead of the 2019-high (1.3665), with the break of trendline support raising the risk for a further decline in the exchange rate.
The move above the 1.3280 (23.6% expansion) to 1.3330 (38.2% retracement) region may turn out to be short-lived as USDCAD fails to extend the recent string of higher highs and lows, with a break/close below 1.3220 (50% retracement) bringing the 1.3120 (61.8% retracement) to 1.3130 (61.0% retracement) area on the radar.
Will keep a close eye on the Relative Strength Index (RSI) as it continues to track the bearish formation from March, with the next area of interest coming in around 1.2980 (61.8% retracement) to 1.3030 (50% expansion).
Disclaimer:
The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.
The dollar held within striking distance of the year's peaks on the euro and yen on Wednesday, as investors looked for the Federal Reserve to begin unwinding pandemic-era policy support faster than central banks in Europe and Japan.
Gold and silver turned sharply higher after the weekend‘s drone attacks on Saudi oil fields saw tensions in the area ratchet higher with US President Donald Trump warning Iran that he is ’locked and loaded.
Crude oil prices may fall if upbeat US retail sales and consumer confidence data cool Fed rate cut bets and sour risk appetite across financial markets.
EURUSD fails to test the 2019-low (1.0926) following the ECB meeting, with the Relative Strength Index (RSI) breaking out of the bearish formation carried over from June.