USDCAD Analysis
| Performance after Monday | |||||
| Period | Pct | Chg | Momentum | ||
| Monday | -0.31% | -45.2 Pips |  |
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| Week to-date | -0.31% | -45.2 Pips |  |
||
| December | 2.45% | 342.6 Pips |  |
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Upcoming key events (London Time)
No major events for the day.
What happened lately
In the United States, economic data showed mixed results for the housing and manufacturing sectors. As per reports, Pending Home Sales for November witnessed a rise, climbing to 2.2% from a revised figure of 1.8% in October, reflecting a stronger-than-anticipated demand in the housing market. This increase suggests that despite broader economic challenges, the housing market exhibited resilience during the month. However, manufacturing data offered a contrasting scenario as evidenced by the Chicago Purchasing Managers’ Index (PMI). The index, which is a key barometer of manufacturing conditions in the region, dropped to 36.9 points for December, down from 40.2 points in November. This decline in the PMI indicates a contraction in manufacturing activity and potentially hints at underlying weaknesses in the industrial sector, amidst economic uncertainties and potential supply chain disruptions.
With regard to the USDCAD currency pair, the mixed economic news from the United States reflects a scenario of divergent economic signals that could impact trader sentiment. On one hand, the positive trend in the U.S. housing market, highlighted by the rise in pending home sales, might support the U.S. dollar as confidence in the economy is bolstered. Conversely, the marked decline in the Chicago PMI could weigh down on the dollar as it indicates manufacturing sector struggles, potentially leading to concerns about economic slowing. On Monday, the USD saw a depreciation of 0.31% against the CAD, closing at 1.43498. Given the lack of major events on the forthcoming agenda, traders may continue to rely on existing economic indicators, such as these reports, to gauge market sentiment and possible trade opportunities. Hence, fluctuating confidence in economic performance is likely to continue influencing the USDCAD movements in the short term.
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What can we expect from USDCAD today?
USDCAD on Monday dropped -0.31% to 1.43498. Price is below 9-Day EMA while Stochastic is rising.
Updated daily direction for USDCAD looks bearish as the pair posted lower in Monday trading session.
Looking ahead for the day, immediate support level is at S1 1.43156 with break below could see further selling pressure towards S2 at 1.42813. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.44329 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.43400 would indicate selling pressure.
For the week to-date, take note that USDCAD is mixed as compared to the prior week.
Key levels to watch out:
| R3 | 1.45014 |
| R2 | 1.44671 |
| R1 | 1.44085 |
| Daily Pivot | 1.43742 |
| S1 | 1.43156 |
| S2 | 1.42813 |
| S3 | 1.42227 |
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