Trading news

USD/CAD Choppy Sessions Continues - Quick Trade Plan!

The USD/CAD closed at 1.33545 after placing a high of 1.34309 and a low of 1.33537. The pair USD/CAD struggled to make a meaningful recovery and continued to move in lower direction on the back of broad-based US dollar weakness. The US Dollar Index lost 1.75% and posted its lowest weekly close since September 2018 at 93.5 level.

The greenback failed to capitalize despite the risk-off market sentiment as the US dollar's safe-haven status faded away after US economic recovery came under pressure by the record increase in the number of coronavirus cases in the US. The US coronavirus cases crossed 4 million with a total number of deaths above 140,000 as President Donald Trump pushed to reopen the schools in fall. This raised the fears for another round of coronavirus in the economy and weighed on the US dollar added in the losses of USD/CAD pair.

Additionally, the macroeconomic data released from the US also weighed on the US dollar. At 17:30 GMT, the Core Durable Goods Orders for June declined to 3.3% from the expected 3.5 % and dragged the USD/CAD pair with the US dollar. However, the Durable Goods Orders for June raised in June to 7.3% from the expected 7.0% and supported the US dollar.

There was no macroeconomic figures to be released from Canada on Monday; hence the USD/CAD pair followed the US dollar movements.

On the other hand, the WTI Crude Oil prices gained on the back of escalated US-China tensions. After the US ordered China to close its consulate in Houston in accusation of spying, China retaliated with the same move and closed the US consulate in Chengdu. This raised fears of a halt in the US-China trade deal; however, both countries have not issued any comment on the phase-one trade deal. The WTI Crude oil raised above $41 on Monday and gave strength to commodity-linked Loonie, which ultimately weighed on the USD/CAD pair.

On Wednesday, FOMC will conduct its meeting for July monetary policy and release its statement alongside the rate decision. Market traders will look forward to its release to take fresh clues.



Daily Technical Levels

Support Resistance

1.3328 1.3409

1.3300 1.3460

1.3248 1.3489

Pivot point: 1.3380

The USD/CAD is consolidating with a mixed sentiment near 1.3385. Simultaneously, overall trading sentiment continues to be bearish as the pair trades within a bearish channel that produces resistance at the 1.3385 mark. A bearish breakout at 1.3362 could prolong sell-off unto the next support mark of 1.3318. Additional selling sentiment could be seen beneath the 1.3318 level. Overall, the RSI and MACD also signal bearish bias in the pair. Hence, we should be seeing for selling trades beneath the 1.3360 level, to seize a quick 50 pips. Good luck! 

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Wednesday, 29 Jul, 2020 / 4:12

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