On Thursday, the USD/CAD currency pair pulled back from the current week’s high of about 1.3746 to trade at about 1.3700. The currency pair trades within an ascending channel formation in the 60-minute chart.

The pair continues to trade a few levels above the 100-hour moving average line, despite the pullback. Thursday’s pullback prevented the currency pair from advancing 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 the U.S. market. On Wednesday, the Federal Reserve decided to keep the base interest rate flat at 4.5% as predicted. However, the committee raised the 1-year projection to 3.6%, up from 3.4% in the previous update, while the 2-year projection is now at 3.4%, up from 3.1%.

The projections for the current year and long-term remained unchanged at 3.9% and 3%, respectively. Building permits for May missed the expected (MoM) tally of 1.43 million with 1.393 million, while housing starts fell short of 1.36 million with 1.256 million (MoM). Elsewhere, the initial jobless claims for the week ending June 13 matched the forecasted claim count of 245k, down from the previous week’s equivalent of 250k.

Earlier in the week, the U.S. retail sales for May missed the expected (MoM) change of -0.7% with a change of -0.9%. The retail sales ex-autos for the period also fell short of 0.1% with a change of -0.3% (MoM), while industrial production for the month missed the (MoM) expectation of 0.1% with a change of -0.2%.

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

Technically, the USD/CAD currency pair trades within an ascending channel formation. However, the 14-hour RSI has recently pulled back to avoid rallying into overbought conditions.

Therefore, the bears will look to stretch the current pullback towards 1.3651 or lower to 1.3607. On the other hand, the bulls will look to pounce on extended gains at about 1.3746 or higher at 1.3790.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair trades within a descending channel formation. However, the 14-day RSI has recently bounced back to avoid falling into oversold conditions.

Therefore, the bulls will look to extend the current rebound towards 1.3861 or higher to 1.4009. On the other hand, the bears will look to ride the current run of declines toward 1.3534 or lower to 1.3376.