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USD/CAD testing lows near 1.2980 ahead of US data

FXStreet (Edinburgh) - After a brief adventure beyond the 1.3000 handle, USD/CAD has now returned to session lows in the 1.2985/80 band.

USD/CAD weaker ahead of US data

Spot continues to meander in a narrow range today, with the generalized softer tone in the greenback and the recovery in crude oil prices as the main drivers behind the recent increase in the buying interest around CAD.

Next on tap will be the US Retail Sales followed by Producer Prices and the Fed’s Beige Book. Market consensus expects headline sales to have expanded at a monthly pace of 0.2% during September, while core sales are seen contracting 0.1% MoM.

USD/CAD levels to consider

As of writing, the pair is down 0.40% at 1.2986 and a breakdown of 1.2917 (100-day sma) would aim for 1.2900 (low Oct.9) and then 1.2869 (Fibo 38.2% of 1.1916-1.3458). On the other hand, the initial up barrier aligns at 1.3095 (Fibo 23.6% of 1.1916-1.3458) followed by 1.3181 (55-day sma) and finally 1.3458 (11-year high Sep.29).

GBP: Tightening labour market conditions is becoming compelling - MUFG

Derek Halpenny, Research Analyst at MUFG, notes that the negative sentiment for the pound was on show yesterday with the news of the AB InBev purchase of SABMiller for GBP 68bn failing to provide the pound with support for longer than a few hours. Of course the news was not a huge surprise and was perhaps well priced but the nonetheless, the turnaround during the day highlighted the continued negative sentiment for the pound.
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USD trading under pressure – TDS

Research Team at TDS, note that the USD is trading under pressure today, losing ground against the whole G10 complex and most liquid EM currencies, as a second member of the Fed’s Board of Governors has spoken publicly downplaying the need for near-term rate hikes.
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