USDCAD Analysis
| Performance after Thursday | |||||
| Period | Pct | Chg | Momentum | ||
| Thursday | -0.01% | -0.8 Pips |  |
||
| Week to-date | -0.35% | -50 Pips |  |
||
| March | -1% | -145 Pips | |
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Upcoming key events (London Time)
No major events for the day.
What happened lately
In the United States, new economic data highlights that the U.S. Initial Unemployment Insurance Claims for the week ending 15 March rose slightly to 223K from a previous revised figure of 221K. This suggests a marginal uptick in unemployment claims, indicating mild labor market weakening. Additionally, the U.S. Manufacturing Business Outlook Survey fell significantly from 18.1 points in February to 12.5 points in March, as reported by the Philadelphia Fed, signaling a slowdown in manufacturing expansion. Interest rate projections for the U.S. have been adjusted by the Federal Reserve, with the 1st year targets dropping to 3.4% from the preceding 3.9%. The longer-term interest rate stance remains stable at 3% while the Fed’s current interest rate decision stands unchanged at 4.5%. Furthermore, 2nd-year interest rate projections were also reduced to 3.1% from 3.4% alongside a broader interest rate projection cut to 3.9% from 4.4%. Such adjustments suggest a more cautious and possibly dovish stance by the Federal Reserve in the near to medium-term.
The USDCAD pair experienced a minor drop of 0.01% to 1.43170, entering a phase of consolidation. The lack of drastic changes in the exchange rate suggests market stability amidst the economic report releases. The slight increase in unemployment claims and the considerable drop in the manufacturing index can exert downward pressure on the U.S. Dollar due to perceived economic slowing. However, these are offset by no changes to the current fed interest rate of 4.5% which provides ongoing support. Despite the dovish tilt on interest rate projections, the Canadian Dollar may not see significant strengthening as there are no major events for Canada to influence the pair strongly. Hence, USDCAD might see limited movement without other significant economic events to drive short-term shifts in market sentiment.
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What can we expect from USDCAD today?
USDCAD on Thursday dropped -0.01% to 1.43170. Price is below 9-Day EMA while Stochastic is rising in oversold zone.
Updated daily direction for USDCAD looks mixed as the pair is likely to consolidate above 1.43107 (S1).
Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.43240 or trades above daily pivot 1.43173. Break above could target R1 at 1.43237. While to the downside, we are looking at 1.43107 (S1) and daily low of 1.43110 as support levels. USDCAD need to break on either side to indicate a short-term bias. A close below 1.43110 would indicate selling pressure.
For the week to-date, take note that USDCAD is bearish as the pair posted lower by -0.35%.
Key levels to watch out:
| R3 | 1.43367 |
| R2 | 1.43303 |
| R1 | 1.43237 |
| Daily Pivot | 1.43173 |
| S1 | 1.43107 |
| S2 | 1.43043 |
| S3 | 1.42977 |
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