On Thursday, the USD/CAD currency pair pulled back from the session highs of about 1.3858 to trade at about 1.3812. The currency pair trades within a descending channel formation in the 60-minute chart.

Thursday’s extended pullback pushed the pair several levels below the 100-hour moving average line. As a result, the currency pair is on the verge of entering 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. In Canada, the seasonally-adjusted Ivey Purchasing Managers’ Index for March missed the expectation of 55.9, with a reading of 49.7, down from 56.6 in February. Traders will be looking forward to the Canadian employment data for March on Friday.

In the US, the annualized gross domestic product for Q4 missed the expectation of 0.7%, with a change of 0.5%. The gross domestic product price index for the period also fell short of 3.8%, with a change of 3.7%. On the other hand, the initial jobless claims for last week came in worse than expected, with 219k versus a forecast of 210k, up from the previous week’s claim count of 203k.

The us persona consumption expenditures price index for February matched the (MoM) forecast of 0.4%. The (YoY) equivalent was also in line with the estimate of 2.8%. The core personal consumption expenditures price index for the month came in at 0.4% (MoM) and 3% (YoY) as expected. 

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 also supports a short-term bearish bias as it edges closer to oversold conditions. 

Therefore, the bears will look to extend the current decline towards 1.3766 or lower to 1.3718. On the other hand, the bulls will look to pounce on rebounds at about 1.3858 or higher at 1.3901.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair trades within a descending channel formation. The 14-day RSI has also recently pulled back to avoid rallying into overbought conditions.

Therefore, the bears will look to stretch the latest pullback towards 1.3668 or lower to 1.3507. On the other hand, the bulls will look to pounce on profits at about 1.3969 or higher at 1.4119.