On Thursday, the USD/CAD currency pair pulled back off the session highs of about 1.3599 to trade at about 1.3550. The currency pair trades within a descending channel formation in the 60-minute chart.

The pair has now fallen to trade a few levels below the 100-hour moving average line. As a result, the currency pair is moving closer to the oversold 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. On Thursday, the US initial jobless claims for the week ending September 13 outshone the forecasted claim count of 230k with a significantly lower tally of 219k, down from the preceding week’s equivalent of 231k.

The Philadelphia Fed Manufacturing Survey for September also came in stronger than expected with 1.7, versus a forecast of -1, up from -7 in the preceding period. On Wednesday, the Federal Reserve decided to cut the base interest rate by 50 basis points to 5%, down from 5.5%. Analysts were expecting a rate cut of 25 basis points to 5.25%.

In Canada, the consumer price index for August fell to -0.2% down from 0.4% in the previous month, missing the (MoM) forecast of 0.1%. The (YoY) equivalent also edged lower to 2%, down from 2.5% in July, falling short of the forecasted change of 2.1%.

On the other hand, the BoC’s core CPI for the period edged lower to -0.1% down from 0.3% (MoM), while the (YoY) equivalent fell to 1.5%, down from 1.7%. Traders will be looking forward to Canada’s July retail sales data on Friday.

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

Technically, the USD/CAD currency pair trades within a descending channel formation in the 60-minute chart. The 14-hour RSI has also pulled back to move closer to oversold conditions.

Therefore, the bears will look to stretch the current run of declines toward 1.3526 or lower to 1.3499. On the other hand, the bulls will look to pounce on rebounds at about 1.3574 or higher at 1.3599.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair trades within an ascending channel formation. However, the 14-day RSI has recent;y pulled back to avoid rallying towards overbought conditions.

Therefore, the bears will look to extend the current pullbacks toward 1.3443 or lower to 1.3340. On the other hand, the bulls will look to pounce on profits at about 1.3647 or higher at 1.3747.