USD/CAD recently bounced off the 1.3300 event area from where the price is expected to climb higher. Despite some downbeat reports from the US, USD has been able to regain momentum. On the other hand, CAD has given in to USD pressure.
The US released tepid economic data earlier this week such US factory orders and JOLTs job openings which missed analyst expectations. On Friday, the reports on the US labor market revealed mixed data. On the plus side, nonfarm payrolls surged to 196K in March, beating the forecast of 172K in March. The strong increase in the US private sector employment followed from minor employment growth in February. On the minus side, average hourly earnings eased 0.1% last month from 0.3% growth previously.
Yesterday the USD/CAD pair traded sideways. The pair even fell below 1.33 in the North American session amid a spike in crude oil prices. Further, ahead of Canada's IVEY PMI the pair was trapped in a trading range sticking to intra-day lows during the North American session. Meanwhile, tarders are voicing concerns about the long-awaited trade deal between the US and China.
Yesterday US President Donald Trump made comments on a further agenda for trade talks. Trump announced that the summit with his Chinese counterpart will take place next with the view to making an economic agreement between two countries. In overnight trade, the US dollar found support from rising yields of US Treasuries. The pair continued trading sideways in the Asian session today. Being the commodity currency, CAD is propped up by a steady rally of oil prices. Yesterday crude oil hit new 2019 highs.
This week, the ecoonmic calendar is loaded with reports from the US. Apart from crucial economic data like CPI and CPI, the US will present a report on unemployment claims, a consumer sentiment index from the Univercity of Michigan, and a federal budget balance. Besides, market participants await speeches of FOMC Members Randal Quarles and Neel Kashkari. A raft of reports and events in the US will determine a further direction on USD/CAD.
Now let us look at the technical view. The price is currently being held by the dynamic level of 20 EMA. Near-term resistance is expected to push the price a bit lower. The pair is going to make a consolidation along the way. Alternatively, if the price remains above 1.3300, it will reinforce upward pressure with a target towards 1.3400-50 resistance area in the coming days.
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