USDCAD Analysis
| Performance after Thursday | |||||
| Period | Pct | Chg | Momentum | ||
| Thursday | 0.15% | 22 Pips |  |
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| Week to-date | -0.41% | -59 Pips |  |
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| March | -1.2% | -174 Pips | |
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Upcoming key events (London Time)
Fri 12:30 PM USD PCE Price Index, excluding food and energy (12-mth)
What happened lately
The latest economic data from the United States shows a mixed scenario across different sectors. In February, pending home sales increased by 2%, marking a recovery from a 4.6% decline in January. This indicates a positive trend in the housing market. Meanwhile, the U.S. GDP Price Index in Q4 2024 slightly decreased to 2.3% from 2.4% in the previous quarter, while the GDP annual rate saw a modest increase to 2.4% from 2.3%. This suggests a stable economic growth rate. The Personal Consumption Expenditures (PCE) Price, excluding food and energy, also decreased marginally to 2.6% in Q4 2024, indicating a slight easing of inflationary pressures. Initial unemployment claims showed a minor decline to 224K in the week ending 22 March, reflective of a resilient labor market. However, durable goods orders presented a more concerning picture, with a 0.9% decrease in February, following a significant increase in January. Nondefense capital goods orders excluding aircraft decreased by 0.3%, and durable goods orders excluding defense and transportation also showed varied results, pointing to some weakness in business investments.
The mixed economic data from the U.S. is likely to have a varied impact on the USDCAD currency pair. A stronger housing market and stable growth in GDP could be supportive of the U.S. dollar, possibly leading to an appreciation against the Canadian dollar. However, the decline in durable goods orders and capital goods orders might offset this effect by indicating potential weaknesses in the manufacturing and business investment sectors. Additionally, the slight decrease in PCE prices suggests reduced inflationary pressures, which might influence the Federal Reserve’s monetary policy decisions. The upcoming release of the PCE Price Index, excluding food and energy, seen as a crucial measure of inflation, could also impact market expectations and influence the pair’s movement. Overall, amid these mixed signals, USDCAD may continue to experience consolidation as traders weigh the various economic indicators and their implications.
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What can we expect from USDCAD today?
USDCAD on Thursday rose 0.15% to 1.43080. Price is below 9-Day EMA while Stochastic is falling.
Updated daily direction for USDCAD looks mixed as the pair is likely to consolidate above 1.42657 (S1).
Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.43289 or trades above daily pivot 1.42973. Break above could target R1 at 1.43396. While to the downside, we are looking at 1.42657 (S1) and daily low of 1.42550 as support levels. USDCAD need to break on either side to indicate a short-term bias. A break above 1.43289 may suggest continuation after recent positive movement.
For the week to-date, take note that USDCAD is mixed as compared to the prior week.
Key levels to watch out:
| R3 | 1.44135 |
| R2 | 1.43712 |
| R1 | 1.43396 |
| Daily Pivot | 1.42973 |
| S1 | 1.42657 |
| S2 | 1.42234 |
| S3 | 1.41918 |
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