The USD/CAD pair was closed at 1.38987 after placing a high of 1.39605 and a low of 1.38677. Overall the movement of the USD/CAD pair remained bearish throughout the day. At 17:30 GMT, the Consumer Price Index (CPI) from Canada for the month of April was declined by 0.7% against the forecasted decline by 0.6% and weighed on CAD. The Common CPI for the year from Canada fell short of expected 1.7% and came in as 1.6% to weigh on the Canadian dollar. However, the Median CPI for the year exceeded the expectations of 1.9% and supported the Canadian dollar by releasing as 2.0%.
The Trimmed CPI for the year came in line with the expectations of 1.8%. The Wholesale Sales for March were reported as -2.2% compared to -4.5% forecasted and supported CAD. At 17:32 GMT, the Core CPI for the month of April declined by 0.4% in comparison to February 0.1%.
Poor than expected CPI data from Canada should have weighed on Loonie, but as the market participants were aware of coronavirus impact over the global economy, it was expected, so the economic data from Canada was mostly ignored on Wednesday.
However, the broad-based U.S. dollar weakness amid the latest doubts over the potential COVID-19 vaccine caused the downfall in the USD/CAD pair that day. The animal trials for the COVID-19 vaccine turned out to provide negative results when all monkeys, whether received vaccine or not, were reported to have coronavirus in their noses.
USD/CAD - Daily Technical Levels
Support Resistance
1.3859 1.3954
1.3815 1.4005
1.3763 1.4049
Pivot Point 1.391
The USD/CAD prices are holding under a strong resistance level of 1.3920 level, which is extended by the 50 EMA. At the same level, the USD/CAD is also finding resistance by horizontal trendline. While the support is staying at 1.3859 level, a bearish breakout of this level could extend selling until 1.3730 level of the RSI and 50 EMA, suggesting selling bias in the USD/CAD pair. Later today, we have Flash Manufacturing PMI from the U.S., which may help drive further movement in the pair. So let's wait for it and consider taking selling trades below 1.3860 and buying above the same for now. Good luck!