EUR/USD 1.15414
0.000%
Gold 4423.23
1.264%
Oil 81.828
-0.434%
USD/JPY 159.216
-0.051%
GBP/USD 1.35058
-0.010%
GBP/JPY 215.039
-0.061%
Browse More
  • English
  • 简体中文
  • 繁體中文
  • Tiếng Việt
  • ไทย
  • Indonesia
Subscribe
Real-time News
On August 12th, JPMorgan Asset Managements chief global strategist stated that the Federal Reserve should maintain interest rates and expects inflation to gradually decline as increasing evidence suggests a persistent wage-price spiral will not form. David Kelly, speaking after the release of the July Consumer Price Index, said, "The Fed should absolutely hold off, and I actually think they will." The report showed that core inflation in the US remained moderate in July, and US Treasury bonds continued their upward trend after the news was released. Kelly pointed out that three forces are working together to significantly cool inflation: tariff costs will decline year-on-year; oil prices will fall as markets become optimistic that the Iran war will end; and wage growth continues to lag behind inflation. He added that the last point weakens the momentum needed for price pressures to form a self-reinforcing cycle, meaning the Fed doesnt need to raise interest rates to curb inflation. Kelly noted that financial markets are currently highly leveraged, and even a small rate hike could trigger asset repricing.Ukraines Deputy Minister of Infrastructure stated that due to escalating Russian attacks, only 159 ships entered the Odessa port hub for loading in July, compared to nearly 400 during the same period last year.Israeli Defense Minister Katz: The Israel Defense Forces will continue to be stationed in the security zones of Lebanon, Syria, and Gaza.Russian Defense Ministry: Russia struck a ship in the port of Odessa.Texas Governor: CleanSpark will comply with data center standards.

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.


Suggestion