USDCAD Analysis
| Performance after Tuesday | |||||
| Period | Pct | Chg | Momentum | ||
| Tuesday | -0.2% | -27.7 Pips |  |
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| Week to-date | -0.16% | -22 Pips | |
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| June | -0.54% | -74 Pips | |
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Upcoming key events (London Time)
Wed 01:30 PM USD CPI Inflation Rate (12-mth) Thu 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)
What happened lately
In the United States, critical economic events are scheduled that have the potential to move the US dollar, impacting currency pairs such as the USDCAD. The Consumer Price Index (CPI) Inflation Rate, which is anticipated to be released on Wednesday, signifies the changes in the purchasing trends and inflationary pressures within the economy. This indicator is closely monitored as it influences the Federal Reserve’s monetary policy decisions. An unexpected rise in CPI could lead to an appreciation of the US dollar as it would likely signal a tightening of monetary policy to curb inflation. On Thursday, the Producer Price Index (PPI) excluding Food and Energy sectors will be announced. This index measures the average change over time in the selling prices received by domestic producers for their output, excluding volatile items such as food and energy. The PPI is another essential data point that provides insights into wholesale inflation and production costs. Higher than expected PPI values may suggest increasing inflationary pressures, leading to potential interest rate hikes that could bolster the dollar.
Given the upcoming high-impact economic events in the United States, the USDCAD exchange rate could be significantly influenced. The pair’s recent drop of -0.2% to 1.36704 suggests a phase of consolidation. This indicates that traders might be awaiting the upcoming economic data releases before committing strongly to either direction. Should the CPI and PPI figures come out higher than anticipated, it could result in a stronger US dollar, leading to an upward pressure on the USDCAD. Conversely, lower than expected numbers might suggest a weakening of the dollar, pressuring the USDCAD to move lower. Therefore, traders will likely keep a close eye on these releases to gauge the potential direction of the pair, highlighting their sensitivity to inflation data amidst a backdrop of ongoing economic uncertainties.
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What can we expect from USDCAD today?
USDCAD on Tuesday dropped -0.2% to 1.36704. 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 1.36454 (S1).
Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.37285 or trades above daily pivot 1.3687. Break above could target R1 at 1.37119. While to the downside, we are looking at 1.36454 (S1) and daily low of 1.36620 as support levels. USDCAD need to break on either side to indicate a short-term bias. A close below 1.36620 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 | 1.37784 |
| R2 | 1.37535 |
| R1 | 1.37119 |
| Daily Pivot | 1.3687 |
| S1 | 1.36454 |
| S2 | 1.36205 |
| S3 | 1.35789 |
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