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February 19th, Futures News: Economies.com analysts latest view: Spot gold prices fell in the latest intraday trading, after hitting the EMA50 resistance level, subsequently encountering new selling pressure that limited any rebound attempts. Meanwhile, the Relative Strength Index (RSI) showed negative divergence, indicating a discrepancy between price action and the indicator, and the indicator has reached severely overbought levels, further releasing negative signals.February 19th, Futures News: Economies.com analysts latest view: WTI crude oil futures prices closed near their intraday highs, maintaining a strong upward trend after stabilizing at the key resistance level of $65.35. Currently, prices are attempting a temporary correction to accumulate the necessary bullish momentum to break through and hold above this key resistance, opening up space for a new round of upward movement.February 19th, Futures News: Economies.com analysts latest view: Brent crude oil futures prices rose sharply in the previous trading session, returning to a major bullish trend in the short term and trading along the support line of this trend. Benefiting from dynamic support and resistance above the EMA50 moving average, it is preparing to test the key resistance level of $70.30. On the other hand, we note that the Relative Strength Index (RSI) has shown a negative overlap signal after reaching overbought levels, which may limit the gains of Brent crude oil futures in the coming period.February 19th - Reserve Bank of New Zealand Assistant Governor Silk stated that the central bank is in a unique position this year: a strong economic recovery is expected, but without triggering inflationary pressures. The Reserve Bank of New Zealand kept interest rates at 2.25% yesterday, indicating that policy will remain accommodative as inflation is expected to slow to the 2% target level. However, the bank also predicts that economic growth will accelerate to 2.8% by March 2027. Silk stated, "The core issue discussed at this meeting was: why do we believe that economic growth and a decline in inflation can occur simultaneously?" She added, "This may seem contradictory, but the existence of an output gap means that strong economic growth is possible. During this period, economic growth may eventually exceed potential growth levels." Investors have already fully priced in the expectation of a 25 basis point rate hike by the bank in December.The China Earthquake Networks Center officially reported that a magnitude 3.6 earthquake occurred at 12:40 on February 19 in Rutog County, Ngari Prefecture, Tibet (33.62 degrees north latitude, 81.89 degrees east longitude), with a focal depth of 10 kilometers.

As investors wait for US/Canada employment data, the USD/CAD trading range is limited to 40 pips

Daniel Rogers

Apr 06, 2023 13:36

 USD:CAD.png

 

The USD/CAD pair retraced below 1.3450 in the early Asian session as the US Dollar Index (DXY) lost upside momentum after reaching the key resistance level of 102.00. As investors anticipate the release of the United States/Canada Employment data, the Canadian dollar is expected to deliver a dazzling performance.

 

As a consequence of a decline in Job Openings and sluggish additions of new positions, as measured by Automatic Data Processing, firms have slackened recruitment efforts, thereby alleviating the tight US labor market. (ADP). This has led to expectations that the Federal Reserve (Fed) will keep interest rates unchanged at its May meeting.

 

In the interim, S&P500 futures have resumed their downward trend, indicating a cautious market sentiment.

 

Employment data will influence the Canadian Dollar. The consensus estimate for Net Change in Employment is 12K, which is a decrease from the previous release of 21.8K. The estimated unemployment rate is 5.1%, up from 5.0% previously.

 

The USD/CAD exchange rate is exhibiting an Inverted Flag pattern on an hourly time frame. The Inverted Flag is a trend-following pattern that consists of a protracted consolidation followed by a decline. Participants prefer to enter an auction after a bearish bias has been established, and current vendors increase their position size during the consolidation phase of a chart pattern.

 

The Canadian dollar was unable to maintain a position above the 50-period Exponential Moving Average (EMA) at 1.3458, indicating that further declines are imminent.

 

Meanwhile, the Relative Strength Index (RSI) (14) has an upper limit of 60.00. A violation of the unfavorable 20.00-40.00 range will trigger downward momentum.

 

A break below the low of April 04, 1.3406, would expose the asset to a fresh six-week low around 1.3350, the low of February 6 followed by round-number support at 1.3300.

 

In an alternative scenario, a move above the psychological resistance of 1.3500 would lend momentum to US Dollar supporters, propelling the asset toward the 31- and 29-March highs of 1.3559 and 1.3619, respectively.


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