On Wednesday, the USD/CAD currency pair bounced back from the session lows of about 1.4217 to trade at about 1.4254. The currency pair trades within a slightly descending channel formation on the 60-minute chart.

The pair has now advanced to trade slightly above the 100-hour moving average line. However, the currency pair pulled back later to avoid rallying into the overbought levels of the 14-hour RSI.

USD/CAD Fundamentals Overview

From a fundamental perspective, the USD/CAD currency pair trades during a relatively busy period in both markets. In the US, the ISM Services PMI for September fell to 54.9, down from the previous month’s equivalent of 55.4, missing the forecast reading of 55. The ISM Services New Orders Index for the period also edged lower to 59.8, down from 60.9 in August. 

On the other hand, the ISM Services Prices Paid improved to 74, up from 72.6, while the ISM Services Employment Index rose to 50.1, up from 47.8. Traders will be looking forward to the US initial jobless claims data for last week on Thursday, ahead of the preliminary Michigan Consumer Sentiment Index data for October on Friday.

In Canada, the Ivey Purchasing Managers’ Index for September fell to 61.9, down from 62.7 in August. The seasonally adjusted Ivey Purchasing Managers’ Index for the period also fell to 58.2, down from 64.3, missing the forecast reading of 65.2. 

Looking forward, traders will be waiting for the Canadian employment change for September, alongside the unemployment rate and the average hourly wage growth data for the period on Friday.

USD/CAD Technical Analysis (the 60-min Chart)

Technically, the USD/CAD currency pair trades within a slightly descending channel formation on the 60-minute chart. The 14-hour RSI has also recently pulled back to avoid entering overbought conditions.

Therefore, the bears will look to extend the latest pullback towards 1.4217 or lower, to 1.4174. On the other hand, the bulls will look to pounce on profits at about 1.4292 or higher, at 1.4333.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair trades within a slightly ascending channel formation. However, the 14-day RSI has recently pulled back in an attempt to recover from overbought conditions.

Therefore, the bears will look to stretch the current pullback towards 1.4012 or lower, to 1.3755. On the other hand, the bulls will look to pounce on profits at about 1.4500 or higher, at 1.4739.