USDCAD Analysis
| Performance after Thursday | |||||
| Period | Pct | Chg | Momentum | ||
| Thursday | -0.35% | -49.6 Pips |  |
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| Week to-date | -0.07% | -10 Pips |  |
||
| February | -2.2% | -319 Pips | |
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Upcoming key events (London Time)
No major events for the day.
What happened lately
In recent economic developments from the United States, Initial Unemployment Insurance Claims saw an uptick for the week ending 15 February, rising to 219,000 from the previous 213,000. This increase in jobless claims signifies a slight cooling of the labor market. Concurrently, the U.S. Manufacturing Business Outlook Survey painted a bleaker picture, plummeting from 44.3 points in January to 18.1 points in February as reported by the Philadelphia Federal. This steep decline suggests a slowing in manufacturing sector confidence and possibly a contraction in manufacturing activities. Further analyzing the housing sector, January witnessed a slight increase in U.S. Building Permits to 1.483 million compared to a revised 1.482 million in December, indicating stable albeit slow growth in future construction activity. However, Housing Starts showed a decline, decreasing in January to 1.366 million compared to the upwardly revised December value of 1.515 million, pointing towards a possible slowdown in new housing completions.
The latest U.S. economic data reflects a mixed scenario with disappointments primarily in manufacturing and housing developments, which could cast a shadow on future economic recovery expectations. These results have had a significant impact on the USDCAD currency pair. The data releases contributed to a weakening of the U.S. dollar relative to the Canadian dollar, which resulted in USDCAD falling by 0.35% to 1.41740. This downward movement in USDCAD is likely a response to the softer U.S. economic indicators which may reduce expectations for rate hikes or robust economic performance. In contrast, factors supporting the Canadian dollar, such as stable or positive data from Canada or higher commodity prices like oil, may also play a role in the currency pair’s movement. With no major economic events scheduled for the immediate future, USDCAD’s trajectory may continue to reflect the prevailing weaker U.S. economic outlook and external factors influencing the Canadian economy.
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What can we expect from USDCAD today?
USDCAD on Thursday dropped -0.35% to 1.41740. Price is below 9-Day EMA while Stochastic is rising.
Updated daily direction for USDCAD looks bearish as the pair posted lower in Thursday trading session.
Looking ahead for the day, immediate support level is at S1 1.41432 with break below could see further selling pressure towards S2 at 1.41123. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.42445 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.41630 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 | 1.43062 |
| R2 | 1.42753 |
| R1 | 1.42247 |
| Daily Pivot | 1.41938 |
| S1 | 1.41432 |
| S2 | 1.41123 |
| S3 | 1.40617 |
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