USD/CAD Retracts from Nearly 2-Month High
FXOpen
Yesterday, the USD/CAD exchange rate climbed above 1.3785 for the first time since mid-April.
However, today's USD/CAD chart shows that it failed to consolidate at this peak and has dropped to a weekly low.
These fluctuations might be interpreted as traders positioning themselves ahead of today's critical events. According to ForexFactory:
- At 15:30 GMT+3, US inflation data will be released;
- At 21:00 GMT+3, the Fed's interest rate decision will be announced;
- At 21:30 GMT+3, Powell's press conference will take place.
Technical analysis of the USD/CAD chart:
- The price made a false bullish breakout of the 1.3785 level, which is a bearish signal;
- The red arrow indicates a bearish engulfing pattern that formed during this failed breakout;
- The proximity to the psychological level of 1.3800 may have influenced the increase in selling pressure.
In any case, the USD/CAD rate is heading downwards today towards the triangle with its median around the 1.368 level, reflecting market sentiment ahead of the news. The 1.37370 level (former resistance) might provide market support.
What to expect?
Considering that the Bank of Canada and the ECB already cut interest rates last week (as we reported here and here), it is possible that the Fed will also lean dovish, continuing the rate-cutting cycle. If so, this could weaken the USD relative to other currencies.
Prepare for spikes in market volatility today.
Read analytical USD/CAD price forecasts for 2024 and beyond.
Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips (additional fees may apply). Open your FXOpen account now or learn more about trading forex with FXOpen.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Stay ahead of the market!
Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.
Latest articles
Euro and Pound Retreat from Highs After Strong US Data
The euro and pound have pulled back from their recent highs as the US dollar regained ground following a batch of stronger-than-expected economic data. The Personal Consumption Expenditures (PCE) price index accelerated to 3.7% year-on-year, compared with expectations of
Alibaba Analysis: Uptrend Break Attempt Amid Rising AI Investment
Alibaba reported its first-quarter results on 20 August, revealing a mixed picture for investors. Revenue increased by 9%, driven by accelerating growth in its cloud computing and AI businesses, but net profit fell by nearly three-quarters as capital expenditure on
EUR/AUD: A Hawkish Euro Meets a Stubborn Downtrend
The euro is riding genuine hawkish momentum right now. It's holding above $1.165 against the dollar, its strongest level since mid-May, with markets fully pricing in an ECB hike in September following June's initial tightening move. That conviction is