USD/CAD: Buyers grapple to hold recent recovery, Canadian/US data in focus

22.03.2019
  • Pullback in crude prices joins the USD profit-booking.
  • Canadian CPI/Retail Sales and the US PMI/Housing should be observed next.
  • USD/CAD trades near 1.3370 during early Friday. The pair struggles to hold recent uptick to 1.3400 as a pullback of the US Dollar (USD) confronts crude recovery at the day’s start. Traders may now look for retail sales and consumer price index (CPI) numbers from Canada in addition to the US Markit PMIs and existing home sales for fresh impulse. Loonie seems on a recovery mode as the sun shines on Asia without major news report from either the US or from Canada. The pullback could be profit-booking moves after yesterday’s up-moves while the latest advances of crude prices favor the uptick. The USD/CAD pair surged on Thursday as the greenback gained across the board on upbeat US data after declining heavily during post-FOMC sessions. With the USD’s strength negatively correlated to the crude strength, Canada’s main export, Loonie traders ignored upbeat wholesale sales growth at home. Looking forward, Canadian consumer-centric details like January month retail sales and CPI figures for February could join the US Markit purchasing manager index (PMI) and existing home sales to provide further direction to the pair. Headline Canadian retail sales (MoM) growth may print +0.4% mark against -0.1% prior with CPI (YoY) likely being unchanged at 1.4% but likely weakness in the Bank of Canada’s (BOC) CPI Core (YoY) to 1.2% from 1.5% may challenge the optimism. On the other hand, a preliminary reading of the US Markit manufacturing PMI may improve to 53.6 from 53.0 with no change expected in services PMI figure of 56.0 whereas Markit PMI composite could soften to 55.2 from 55.5 during the present month. Also, the February month existing home sales could rise to 5.10M versus 4.94M on a monthly basis. USD/CAD Technical Analysis Having bounced off the 100-day simple moving average (SMA), at 1.3300 now, the USD/CAD pair can confront a downward sloping resistance-line stretched since January near 1.3430, a break of which can propel the up-moves to 1.3470 and 1.3500. Alternatively, a downside break beneath 1.3300 can drag the quote to 50-day SMA level of 1.3270 and then to the 200-day SMA level of 1.3185.

    Original from: www.fxstreet.com

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