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USD/CAD Continues Choppy Sessions - BOC Gov Macklem Speaks Ahead! 

EagleFX

The USD/CAD pair was closed at 1.36021 after placing a high of 10.36174 and a low of 1.35468. Overall the movement of USD/CAD remained slightly bullish throughout the day. At 17:30 GMT, the Core Retail Sales from Canada for April dropped by 22.0% against the expected 12.7% decline and weighed heavily on the Canadian dollar. The weak Canadian dollar pushed the USD/CAD prices higher on Friday.

The Retail Sales for April also declined by 26.4% against the forecasted 15.0% decline and weighed on the Canadian dollar, which eventually pushed the currency pair USD/CAD higher. However, the WTI crude oil prices surged about 3.5% and above the level of $40 on Friday amid the fresh optimism about the US-China relation. China announced its plans to increase its US farm's product purchases and meet the requirement, so phase one deal, which were affected by the pandemic induced lockdowns.

The strong WTI crude added strength in the commodity-linked currency- Loonie and kept a lid on an additional hike of USD/CAD pair on Friday.

Meanwhile, the Canadian finance minister, Bill Morneau, said on Thursday that the Canadian government would not raise taxes at the pandemic time to help pay for costly coronavirus aid programs. The Liberal government has so far unveiled about C$160 billion worth measures in direct spending, which is equal to 7% of the country's GDP. The expectations of the budget deficit for 2020-2021 exceeded C$250 billion.

Furthermore, there was news that the mid-sized Canadian businesses could now apply through their banks to get loans of up to $60 million form the federal government. The Business Development Bank of Canada will monitor these loans, which are a part of a package of Federal credit programs.

The US dollar remained stressful after the comments from Fed Chair Jerome Powell, who said that the road to recovery was not short and that more stimulus will be required in aid to States, public health measures, and unemployment benefits to keep up with the ongoing crisis. This weighed the US dollar and limited the gains on USD/CAD on Friday.


Daily Technical Levels

Support Resistance

1.3541 1.3639

1.3481 1.3677

1.3443 1.3737

Pivot Point: 1.3579

The USD/CAD is on a bearish mode, as we can see, the pair has crossover below 50 EMA support level of 1.3568. Below this, the market has an opportunity to drop until the next support level of 1.3530 level. The RSI also just had a bearish crossover, which is supporting the selling trend in the USD/CAD pair. On the lower side, the USD/CAD may find immediate support at 1.3510, and violation of this could also lead the pair further lower towards 1.3430 level. Let's look for selling trades below 1.3570 and buying trades above this level today. Good luck!

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