On Thursday, the USD/CAD currency pair pulled back from the session high of about 1.3835 to trade at about 1.3811. The currency pair trades within an ascending channel formation on the 60-minute chart.
The pair continues to trade slightly above the 100-hour moving average line, despite the pullback. As a result, the currency pair still has plenty of 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 during a relatively busy period in the US market. On Thursday, the US producer price index for August matched the forecast (MoM) change of 0.4%. The (YoY) equivalent came in better than expected, with a change of 5.4% versus the forecast of 5.3%.
On the other hand, the producer price index ex-food and energy for the period missed the expected (MoM) change of 0.3%, with a change of 0.2%. The (YoY) equivalent was in line with the estimate of 4.6%.
Elsewhere, the initial jobless claims for last week fell to 206k, down from the previous week’s equivalent of 207k, but still slightly higher than the forecast claim count of 205k. Earlier in the week, the 4-week ADP employment change improved to 12k, up from the previous update of 10k.
Looking forward, traders will be waiting for the US consumer price index data for August, the preliminary Michigan Consumer Expectations and Sentiment Index for September, and the budget statement for August on Friday.
USD/CAD Technical Analysis (the 60-min Chart)
Technically, the USD/CAD currency pair trades within an ascending channel formation on the 60-minute chart. 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 1.3781 or lower, down to 1.3748. On the other hand, the bulls will look to pounce on profits at about 1.3835 or higher, up to 1.3868.
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 recover from oversold conditions.
Therefore, the bulls will look to extend the current rebound towards 1.3939 or higher, up to 1.4054. On the other hand, the bears will look to pounce on profits at about 1.3693 or lower, down to 1.3573.