On Thursday, the USD/CAD currency pair pulled back from the session high of about 1.4360 to trade at about 1.4304. The currency pair trades within a sideways channel formation in the 60-minute chart.
The pair this week plummeted to trade below the 100-hour moving average line. As a result, the currency pair trades 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 the U.S. market. On Thursday, the preliminary U.S. nonfarm productivity for Q4 missed the expected change of 1.7% with a change of 1.2%. The preliminary unit labour costs for the quarter also fell short of 3.8% with a change of 3%.
On the other hand, the U.S. initial jobless claims for the week ending January 31 increased to 219k, up from 208k in the preceding week, missing the forecasted claim count of 213k.
Earlier in the week, the U.S. ISM Services PMI for January missed the expectation of 54.3 with a reading of 52.8, while the S&P Global Composite PMI beat 52.4 with a reading of 52.7. On the other hand, the ADP employment change for January came in stronger than expected with 183k versus a forecast of 150k, up from the previous month’s equivalent of 176k.
In Canada, the seasonally adjusted Ivey Purchasing Managers’ Index for January missed the expectation of 53 with a reading of 47.1.
USD/CAD Technical Analysis (the 60-min Chart)
Technically, the USD/CAD currency pair trades within a sideways channel formation in the 60-minute chart. However, the 14-hour RSI has recently pulled back to move closer to the oversold conditions.
Therefore, the bears will look to extend the current pullback towards 1.4238 or lower to 1.4175. On the other hand, the bulls will look to pounce on rebounds at about 1.4360 or higher at 1.4420.
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 recently pulled back to avoid rallying into the overbought conditions.
Therefore, the bears will look to stretch the current pullbacks toward 1.4036 or lower to 1.3806. On the other hand, the bulls will look to pounce on profits at about 1.4564 or higher at 1.4795.