On Thursday, the USD/CAD currency pair pulled back from the session highs of about 1.3853 to trade at about 1.3804. The currency pair also completed a downward breakout from an ascending channel formation in the 60-minute chart.

The currency pair continues to trade slightly above the 100-hour moving average line despite the pullback. However, it still has some room left to run before reaching the oversold levels of the 14-hour RSI.

USD/CAD Fundamentals Overview

From a fundamental perspective, the USD/CAD currency pair trades ahead of Canada’s key gross domestic data for Q1 on Friday. On Thursday, the preliminary annualised U.S. gross domestic product for Q1 came in better than expected with -0.2% versus a forecast of -0.3%. The preliminary gross domestic product price index for the period was in line with the estimate of 3.7%.

On the other hand, the preliminary personal consumption expenditures for the quarter matched the forecast of 3.6%, while the preliminary core personal consumption expenditures for the period missed 3.5% with a change of 3.4%.

Elsewhere, the initial jobless claims for the week ending May 23 came in higher than expected with 240k versus the forecast of 230k, up from the previous week’s claim count of 226k. Pending home sales for April also missed the expected (MoM) change of -1% with a change of -6.3%.

Earlier in the week, the U.S. durable goods orders for April outshone the forecasted change of -7.9% with a change of -6.3%. The durable goods orders ex-transportation also beat -0.1% with a change of 0.2%, while the housing price index for March fell short of 0.2% with a change of -0.1%.

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

Technically, the USD/CAD currency pair has completed a downward breakout from an ascending channel formation in the 60-minute chart. The 14-hour RSI also supports a bearish bias as it moves closer to oversold conditions.

Therefore, the bears will look to extend the current pullback towards 1.3754 or lower to 1.3708. On the other hand, the bulls will look to pounce on profits at about 1.3853 or higher at 1.3897.

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 still has room left to run before reaching oversold conditions. 

Therefore, the bears will look to ride the current run of declines toward 1.3612 or lower to 1.3432. On the other hand, the bulls will look to pounce on profits at about 1.3990 or higher at 1.4174.