The USD/CAD currency pair on Friday pulled back to trade at around 1.2514 after the latest round of the US consumer sentiment data. The currency pair continues to trade within a descending channel formation in the 60-min chart.

The currency pair also remains pinned below the 100-hour moving average in the 60-min chart after dropping under earlier in the week. However, it continues to trade centrally in the 14-hour RSI, supporting the continuation of the current trend.

USD/CAD Fundamentals Overview

From a fundamental perspective, the USD/CAD currency pair is trading at the back of a relatively busy period in the US market. On Friday, the preliminary Michigan Consumer Sentiment Index for August missed the expectation of 81.2 with 70.2. The July import price index missed the (MoM) expectation of 0.6% with 0.3% but beat the (YoY) estimate of 9.3% with 10.2%. On the other hand, the export price index for the period beat both the (MoM) and (YoY) expectations of 0.8% and 15.9% with 1.3% and 17.2%, respectively.

Earlier in the week, the US producer price index ex-food and energy for July beat the expected (MoM) change of 0.5% with 1%. The (YoY) equivalent also outperformed 5.6% with 6.2%. The general PPI outshone the (MoM) estimate of 0.6% with a change of 1% while the (YoY) equivalent beat 7.3% with 7.%. In addition, the US CPI ex-food and energy missed the (MoM) expectation of 0.4% with 0.3% but matched the (YoY) estimate with 4.3%.

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

Technically, the USD/CAD currency pair appears to be trading within a descending channel formation in the 60-min chart. This indicates a significant short-term bearish bias in the market sentiment.

Therefore, the bulls will be targeting short-term rebound profits at approximately 1.2531 or higher at 1.2548. On the other hand, the bears will look to extend declines towards 1.2500 or lower to 1.2485.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair appears to be trading within a descending channel formation after a downward reversal. This indicates a shift in the market sentiment from bullish to bearish.

Therefore, the bears will be looking to retain control of the pair by targeting profits at 1.2417 or lower at 1.2300. On the other hand, the bulls will target profits at approximately 1.2675 or higher at 1.2790.