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Forex Signals

USD/CAD Enters Overbought Zone – Quick Trade Idea! 

The USD/CAD pair was closed at 1.28019 after placing a high of 1.28224 and a low of 1.26851. Since January 11 on Wednesday, amid the US dollar’s broad-based strength and declining crude oil prices, the currency pair rose to its highest. The US Dollar Index measures the greenback’s value against the basket of six major currencies settled above 90.50 level and supported the US dollar. The US dollar gained traction in the market ahead of the US Federal Reserve monetary policy decision and its safe-haven status.

The risk-averse market mood driven by the rising fears about the negative impact of the lockdown restrictions provided support to the safe-haven US dollar. The US dollar strength remained intact even after the Federal Reserve policy announcement on Wednesday and pushed the currency pair USD/CAD higher on board.

The US Federal Reserve kept its interest rates near zero and asset purchase program at the same pace of $120 billion per month. The Bank stated that the US economic recovery remains moderate throughout the month. The economic path was dependent on the progress made in the pandemic and the vaccination program. These comments from the US Central bank and its Chairman gave strength to the local currency greenback that ultimately added gains in the currency pair USD/CAD on Wednesday.

On the data front, at 18:30 GMT, the Core Durable Goods Orders for December increased to 0.7% against the projected 0.5% and supported the US dollar that added further gains in the USD/CAD pair. In December, the Durable Goods Orders weakened to 0.2% against the projected 1.0%, weighed on the US dollar, and capped further upside momentum in the USD/CAD pair.

On the other hand, there was no macroeconomic data from the Canadian side, and on the West Texas Intermediate (WTI) crude oil front, the oil remained under pressure due to rising prices of the US dollar. The crude oil fell to $51.84 on Wednesday and weighed on the commodity-linked currency Loonie, which ultimately pushed the already rising USD/CAD pair. 


Entry Price – Sell 1.2879

Stop Loss – 1.2930

Take Profit – 1.2810

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

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iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Market Analysis

USD/CAD Choppy Session Continues – Brace for a Breakout Trade! 

The USD/CAD pair was closed at 1.26954 after placing a high of 1.27823 and a low of 1.26897. After placing gains for three consecutive sessions, the USD/CAD pair dropped on Tuesday despite the broad-based US dollar strength and the declining crude oil prices. The USD/CAD pair rose in the first half of the day and posted gains; however, these gains could not live longer and started to close in the second half of the session on Tuesday. The market’s mixed sentiment caused this downward momentum in the USD/CAD pair on the day.

During early trading hours on Tuesday, the risk-off market sentiment kept weighing on the USD/CAD pair as the US dollar was strong due to its safe-haven status. The greenback gained traction after the tensions between the US & China erupted once again at the South China Sea. Furthermore, the Chinese President’s latest warning against the New Cold War also played an important role in giving strength safe-haven greenback.

The Chinese President Xi Jinping warned global leaders on late Monday that starting a new Cold War should be avoided and urged unity in the face of coronavirus pandemic. He added that threatening others and building small cliques will only push the world into division.  

Furthermore, the report from John Hopkins University suggests that the global count of confirmed coronavirus cases reached 100 million in a year and raised concerns for global economic recovery as many nations were still under lockdown and weighed on market sentiment that ultimately weighed on the risk perceived USD/CAD pair.

Meanwhile, the market’s risk sentiment started to turn around as the positive news from Moderna and Pfizer came in to deliver booster shots of the vaccine in about 6-12 months that will provide full immunity. Whereas Johnson & Johnson also announced that it would release data on its vaccine for coronavirus. It was highly awaited as J&J has advertised its vaccine as a game-changer because it would provide full immunity in a single shot, unlike other vaccines so far.

However, the USD/CAD traders seemed to ignore the rebound in market risk sentiment and continued moving with the risk-averse market sentiment, and hence, the USD/CAD pair remained depressive for the day.

On the data front, at 19:00 GMT, the Housing Price Index from the US for November increased to 1.0% against the estimated 0.9% and supported the US dollar. The S&P/CS Composite -20 HPI for the year also increased to 9.1% against the estimated 8.8% and supported the US dollar that capped further downside in the USD/CAD pair. At 19:59 GMT, the Richmond Manufacturing Index for January plunged to 14 against the estimated 18 and weighed on the US dollar, and added further losses in the USD/CAD pair. At 20:00 GMT, the CB Consumer Confidence in January increased to 89.3 against the estimated 88.9 and supported US dollar.

On the crude oil front, the traders also ignored the movements of West Texas Intermediate crude oil prices on Tuesday that declined to $52.27 for the day and weighed on commodity-linked currency Loonie that ultimately caped further downside in the movement of USD/CAD pair.

On Wednesday, the traders will keep a close eye on the US Federal Reserve’s decision to find fresh impetus about the USD/CAD pair movement.


Daily Technical Levels

Support Resistance

1.2688 1.2783

1.2639 1.2829

1.2593 1.2878

Pivot Point: 1.2734

The USD/CAD pair continues to trade sideways in between a narrow trading range of 1.2737 – 1.2688 level. Breakout of this level can drive further moves in the market. On the higher side, the USD/CAD pair can lead it’s price towards 1.2794 and on the lower side, support holds around 1.2626. Let’s brace for a breakout! 

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Forex Signals

USD/CAD Violates Upward Channel – Sell Signal Update!

The USD/CAD pair was closed at 1.27434 after placing a high of 1.27789 and a low of 1.26871. The USD/CAD pair continued its bullish movement for the 3rd consecutive session on Monday and reached above 1.27700 level amid the broad-based US dollar strength despite the risk-off market sentiment and the rising crude oil prices on the day.

The greenback gathered strength against its rivals after a sharp decline in EUR/USD pair triggered by the disappointing German Ifo Business Climate on Monday. The US Dollar Index climbed above 90.30 with the initial marker reaction and made the US dollar stronger on board, ultimately pushing the USD/CAD pair higher.

Another reason behind the rising US dollar prices was the speculations that the $1.9 trillion stimulus package proposed by Joe Biden is expected to face rejection by Democrats and Republicans in the Senate as they were not in favor of more spending just after a month in massive expenditures of $900 billion. The hopes that the US’s massive stimulus package will be delayed due to a difference of opinion gave strength to the US dollar that pushed the rising USD/CAD prices on Monday.

Meanwhile, the USD/CAD pair traders ignored the rising West Texas Intermediate crude oil prices on Monday. The crude oil prices rose by 1.5% on the day and supported the commodity-linked currency Loonie that ultimately capped further upside in the USD/CAD pair’s rising prices.

However, On Monday, Canada marked the anniversary of the first case of coronavirus that was identified in the country. After a year of living with the pandemic, Canada dealt with the increasing spread of new and more contagious variants. Canada reported six new cases of the UK variant of coronavirus and 3 cases of the South Africa variant of coronavirus on Monday, up from 4 and 1.

The rising number of new variant cases of coronavirus infections in Canada raised fears for the nationwide lockdown to curb the spread of this variant and raised threats for an economic recovery that ultimately weighed on the Canadian Dollar and added in the gains of USD/CAD pair on Monday. On the US front, the coronavirus deaths and cases per day in the US dropped markedly over the past couple of weeks but were still running at alarmingly high levels. The government’s top infectious disease expert Dr. Anthony Fauci said that improvement in numbers around the country appears to be the result of natural peaking and then plateauing after a holiday surge rather than an effect of the rollout of vaccines that began in mid-December. This diminishing rate of cases and deaths in the US added to the US dollar’s strength and supported the upward momentum in the USD/CAD pair on Monday.


Daily Technical Levels

Support Resistance

1.2715 1.2738

1.2703 1.2749

1.2693 1.2761

Pivot Point: 1.2726

Entry Price – Sell 1.27067

Stop Loss – 1.27467

Take Profit – 1.26667

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

 

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Forex Signals

Bearish Bias Dominates USD/CAD – EMA Extends Resistance  

The USD/CAD pair is trading with a selling bias at 1.2619 level, facing an immediate resistance around 1.2630 level. The USD/CAD pair is stuck in between a narrow trading range of 1.2630 – 1.2612 level on the two-hourly timeframes. On the lower side, a bearish breakout of 1.2612 level can extend selling bias until the next support level of 1.2580 level. Conversely, an upward crossover of 1.2630 can send the USD/CAD pair further higher until the 1.2665 level. The MACD and RSI are in support of the selling trend today. 



Entry Price – Sell 1.26125

Stop Loss – 1.26525

Take Profit – 1.25725

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Forms Descending Triangle Pattern – Brace for a Breakout Setup! 

The USD/CAD pair was closed at 1.26879 after placing a high of 1.27334 and a low of 1.26633. The USD/CAD pair rose on Thursday due to a strong rebound of the US dollar and Canada’s negative economic data.

The US Dollar Index that measures the value of the greenback against the basket of six major currencies recovered from the 2-years lowest level and came back to 89.85 level on Thursday after rising for 0.35% and gave strength to the US dollar against its Canadian counterpart that eventually lifted USD/CAD pair on board. Wall Street’s main indexes were also high on Thursday, with Dow Jones gaining about 1.7% and NASDAQ gaining about 2.25% on Thursday.

The US treasury yield on a 10-year note was also raised on Thursday above 1% for the first time since March, which also gave strength to the US dollar and raised the USD/CAD pair. Whereas the Canadian dollar was weak onboard on the day despite trading softer against its US counterpart, the Loonie was also underperforming against most of its G10 peers. 

Markets continued pricing the prospects of much more spending from the US government over the coming months and years under the Democratic leader Joe Biden. This increased the expectations of higher US economic growth and higher inflation, hence why US stocks, nominal US bond yields, and US inflation break-evens were higher on Thursday.

On the data front, at 18:30 GMT, the Trade Balance from Canada for November showed a deficit of -3.3B against the expected -3.6B and supported the Canadian dollar that capped further upside in the USD/CAD pair. At 20:00 GMT, the Ivey PMI from Canada for December declined to 46.7 against the expected 53.1 and weighed on the Canadian dollar, which ultimately added strength to the USD/CAD pair’s bullish momentum.

From the US side, at 17:30 GMT, the Challenger Job Cuts for the year in December advanced to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week were plunged to 787K against the estimated 798K and supported the US dollar that added gains in USD/CAD pair. The Trade Balance from November showed a deficit of -68.1B against the estimated-66.7B and weighed on the US dollar that capped further upside in the USD/CAD pair. At 20:00 GMT, the ISM Services PMI advanced in December to 57.2 against the estimated 54.5 and supported the US dollar that added further gains in the USD/CAD pair on Thursday.

On the other hand, the WTI crude oil prices surpassed the $51 per barrel on Thursday and gave strength to commodity-linked currency Loonie that lost most of the gains from the USD/CAD pair on Thursday in late trading hours.


Daily Technical Levels

Support Resistance

1.2653 1.2727

1.2621 1.2767

1.2580 1.2800

Pivot Point: 1.2694

The commodity currency pair USD/CAD is trading with a neutral bias at the 1.2692 level, facing immediate resistance at the 1.2742 level. The USD/CAD pair may find resistance at the 1.2742 level on the hourly timeframe, and closing of a candle below this level may trigger selling until the 1.2640 level. The MACD and RSI are suggesting buying trends, along with 50 periods EMA. I will be looking to take a sell trade around the 1.2745 level today. Good luck! 

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Forex Signals

USD/CAD Downward Trendline to Provide Resistance – Sell Trade in Play! 

The USD/CAD pair was closed at 1.26766 after placing a high of 1.27234 and a low of 1.26297. Despite the continuous rise in crude oil prices, the USD/CAD pair posted gains on Wednesday amid the rebound in US dollar prices. After the two-day OPEC+ meeting, Saudi Arabia announced that they would be voluntarily cutting their output in February and March that will amount to 1 million barrels per day. West Texas Intermediate (WTI) ‘s barrel gained more than 5% and preserved its bullish momentum on Wednesday. The Crude oil prices reached $50.9 per barrel on Wednesday to their highest level in more than ten months and gave strength to commodity-linked Loonie that capped further upside in the currency pair USD/CAD pair.

The US Dollar recovered on Wednesday across the board amid the rising US treasury yields followed by the prospects of a Democratic win in US Senate elections. The US Treasury yield on a 10-year note raised more than 1% on Wednesday to its highest level since March and supported the recovery in the US dollar that ultimately added gains in the USD/CAD pair.

On the data front, From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December plunged to -123K against the estimated 60K and weighed on the US dollar and capped further gains in the USD/CAD pair. At 19:45 GMT, the Final Services PMI for December also plunged to 54.8 against the estimated 55.2 and weighed on the US dollar that limited the upward momentum in the USD/CAD pair. At 20:00 GMT, the Factory Orders for November advanced to 1.0% against the estimated 0.7% and supported the US dollar that added further gains in the USD/CAD pair on Wednesday.

Meanwhile, the USD/CAD pair’s gains remained consolidated as the US dollar came under pressure after the prospects of a Democratic win in the US Senate elections increased. Wining the two seats in Senate by Democrats will give them control over both chambers of Congress that means they could get their agenda passed with the majority. The market participants kept betting over the prospects of larger stimulus measure after the victory of Democrats in runoff elections in Georgia and kept the US dollar under pressure that limited the gains in the USD/CAD pair on Wednesday. Market participants now await the release of meeting minutes from FOMC and the NFP report from the US that will release on Friday and Canada’s labor data.


Daily Technical Levels

Support Resistance

1.2619 1.2758

1.2568 1.2844

1.2481 1.2896

Pivot Point: 1.2706

The USD/CAD pair is trading with a bullish bias at the 1.2725 level, facing immediate resistance at the 1.2742 level. The USD/CAD pair may find resistance at the 1.2742 level on the hourly timeframe, and closing of a candle below this level may trigger selling until the 1.2640 level. The MACD and RSI are suggesting buying trends, along with 50 periods EMA. I will be looking to take a sell trade around the 1.2745 level today. Good luck! 

 

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Forex Signals

USD/CAD Descending Triangle in Play – Quick Trade Idea! 

The USD/CAD pair was closed at 1.26689 after placing a high of 1.27909 and a low of 1.26556. The currency pair USD/CAD fell to its lowest since 2018 April on rising crude oil prices and the US dollar weakness. Despite Canada’s negative economic data and positive data from the US side, the currency pair USD/CAD still moved in the downward direction on Tuesday as investors’ focus was shifted on the OPEC meeting and Georgia’s runoff elections.

On the data front, at 18:30 GMT, the IPPI for November from Canada dropped to -0.6% against the expected -0.2% and weighed on the Canadian dollar that capped further losses in the USD/CAD pair. The RMPI for November also dropped to 0.6% against the expected 0.9% and weighed on the Canadian dollar that capped further losses in the USD/CAD pair on Tuesday. From the US side, at 20:00 GMT, the ISM Manufacturing PMI from December surged to 60.7 against the predicted 56.6 and supported the US dollar, and capped further losses in the USD/CAD pair. The ISM Manufacturing Prices also rose to 77.6 against the expected 66.0 and supported the US dollar that limited further losses in the USD/CAD pair. The Wards Total Vehicle Sales rose to 16.3M against the anticipated 15.8M and supported the US dollar that ultimately limited further losses in the USD/CAD pair.

The West Texas Intermediate (WTI) crude oil prices rose above $50 per barrel on Tuesday as Russia and the Organization of Petroleum Exporting Countries remained deadlocked over how much oil to produce from February. Russia and its neighbor Kazakhstan were both pressuring for the scheduled output increase of 500,000 barrels a day to come into effect, while OPEC, with what appears to be total unanimity, wanted to kept output at its present level due to short-term weakness in demand caused by the latest surge in coronavirus and imposed lockdowns in various countries.

The rising prices of crude oil gave strength to the commodity-linked currency Loonie and added weight on the currency pair USD/CAD. Meanwhile, Georgia’s runoff elections that will decide the US Senate’s future also kept the US dollar under pressure on Tuesday. The result of the elections is expected to announce on Wednesday, and investors were cautious ahead of it, and the selling pressure surrounding the greenback increased that ultimately weighed on the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2619 1.2758

1.2568 1.2844

1.2481 1.2896

Pivot Point: 1.2706

The USD/CAD’s technical side is trading at 1.2690, disrupting the support area of 1.2725 level, which is now working as a resistance for the USD/CAD pair. On the lower side, the support stays at the 1.2647 level, and a bearish breakout of this level can extend selling trend until 1.2591. Let’s wait for opening a sell trade below the 1.2725 level today. Good luck! 

 

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Forex Signals

USD/CAD Bouncing off Over 1.2728 – Do We Have a Buying Trade?

The USD/CAD currency pair failed to stop its Asian session losing streak and remain depressed around the 1.2735 level, mainly due to the U.S. dollar weakness. However, the prevalent downtrend in the greenback is mainly tied to the Federal Reserve’s expectations would keep rates low for a prolonged period. Meanwhile, the optimism over a possible coronavirus vaccine and the probability of an additional U.S. financial aid package also played its major role in weakening the greenback, which adds further burden around the currency pair. 

In contrast to this, the prevalent downticks in the crude oil prices tend to weaken the commodity-linked currency the Loonie, which becomes the key factor that helps the currency pair to limit its deeper losses. As of writing, the USD/CAD currency pair is currently trading at 1.2736 and consolidating in the range between 1.2729 – 1.2792.

Despite the intensified Sino-US tussle and coronavirus (COVID-19) woes, the market trading sentiment managed to stop its previous session’s negative performance and started to flash green during the early European session on the day, possibly due to the fresh optimism over a potential vaccine/treatment for the highly infectious coronavirus. As per the latest report, the U.S. Food and Drug Administration (FDA) showed that almost 95% success ratio of the leading coronavirus vaccines after two doses. Moreover, the market trading sentiment got an additional lift from fresh hopes of the Democratic victory in the Georgian run-off, which sparked possibilities for additional fiscal support. Thereby, the prevalent upbeat market mood undermined the safe-haven assets, including the safe-haven U.S. dollar, and contributed to the currency pair losses.

As in result, the broad-based U.S. dollar failed to halt its overnight losing streak and remained bearish on the day. Meanwhile, the probability of an additional U.S. financial aid package and speculations that the Fed will keep interest rates lower for a longer period also exerted downside pressure on the greenback. The losses in the U.S. dollar kept the currency pair lower. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.04% to 89.812 by 8:49 PM ET (1:49 AM GMT).

On the contrary, the crude oil failed to stop its early-day losing streak and remained depressed around below the $47.50 level on the day mainly due to the renewed concerns over the global economic recovery as the number of COVID-19 cases continues to increase in Europe, the U.S., and Japan. Across the pond, the reason for the losses in the crude oil prices could also be associated with Monday’s released downbeat China’s Caixin Manufacturing PMI data, which showed that the activity slowed in December. Hence, the decline in oil prices undermined demand for the commodity-linked currency the Loonie and became the key factor that helped the currency pair limit its deeper losses. 

Looking forward, the market traders will keep their eyes on the German Unemployment Rate, which is due at 08:55 GMT, and the US ISM Manufacturing, which is due for release at 15:00 GMT. The updates about the U.S. stimulus package and the virus will not lose their importance across the ocean. 



Daily Support and Resistance

S1 1.2691

S2 1.2706

S3 1.2713

Pivot Point 1.2722

R1 1.2729

R2 1.2738

R3 1.2754

The USD/CAD pair is trading with a bullish bias at the 1.2764 level, holding above a support level of 1.2728, and it may head higher until the next target level of 1.2798 level. On the hourly timeframe, the USD/CAD is holding over 50 EMA, which is supporting bullish bias in the Loonie, whereas the MACD is staying in a selling mode. Let’s consider taking sell trade below the 1.2793 level and buying over 1.2728. Good luck! 

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Forex Signals

USD/CAD Supported Over Triple Bottom – Brace for a Trade Here! 

The USD/CAD pair was opened at 1.27142, and it has placed a high of 1.27358 and a low of 1.26950 since then. The pair was currently moving at 1.27035 and was posting losses on Monday for the 5th consecutive session. The losses in the USD/CAD pair during the Asian session on Monday could be attributed to the US dollar’s weakness along with the rising crude oil prices on the day. The deteriorated risk-sentiment could also be a factor behind the USD/CAD pair’s declining prices on Monday. 

The US Dollar was weak across the board on Monday as the US saw a massive increase in the number of coronavirus cases as the total count of infection cases reached 21,110,917 in the country and made it the worst-hit country by the COVID-19. The US Dollar Index was also down on Monday by 0.25% at the 89.67 level.

The US dollar weakness could also be attributed to the latest rejection of an increase in direct payments by the US Senate. Lately, the US President called to increase the direct payments to Americans to $2000 from $600 that was also supported by Democrats; however, these efforts have come to an end after Republicans refused to increase them. Furthermore, the US billions were also hesitant to place strong moves in the market ahead of Tuesday’s Georgia’s electoral runoff and Wednesday’s December meeting minutes release from FOMC.

On the other hand, the West Texas Intermediate (WTI) Crude Oil prices on Monday have reached $49.27 per barrel so far and were moving upward continuously. The crude oil has posted gains for four consecutive sessions, and the outlook remained positive, which means it could increase further. The rising crude oil prices added support to the commodity-linked currency Loonie that ultimately added more pressure on the USD/CAD pair’s prices on Monday.

On the data front, Manufacturing PMI from Canada is expected to release at 19:30 GMT, November’s PMI was 55.8, and anything above it in December could be beneficial for the Canadian dollar, and anything less than it could be against the local currency. From the US side, at 19:45 GMT, the Final Manufacturing PMI from the US for December is predicted to come as 56.3 against the previous 56.5 that could hurt the US dollar and add further losses in the USD/CAD pair. At 20:00 GMT, the Construction Spending for November is forecasted to drop to 1.1% against the previous 1.3% that could also add more losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2704 1.2762

1.2679 1.2795

1.2647 1.2820

Pivot point: 1.2737

The USD/CAD is trading at 1.2684, and violation of this level can extend the selling trend until the 1.2637 level. On the 2 hour timeframe, the USD/CAD is supported due to the triple bottom, but the RSI and MACD are suggesting a selling trend in USD/CAD. However, we can’t take a sell trade unless the 1.2685 level is violated. Let’s wait for a breakout elsewhere; we can take a buy trade over 1.2685 tp target 1.2760. Good luck!

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Forex Course

200. The Correlation Between USD/CAD Pair & Crude Oil

Introduction

Crude oil, also known as black gold, is the major energy source that runs the economy. Canada is among the top oil producers in the world. It is one of the major oil exporters to the USA. Canada exports more than 3 million barrels of petroleum and oil products, a figure that is sufficient to impact USD/CAD’s movement.

USD/CAD and Crude Oil – The Correlation

The volume of crude oil that Canada exports to the US generate massive demand for the CAD. Moreover, Canada’s economy depends a lot on its exports, and approximately 85% of the country’s exports go to the US.

Therefore, the value of USD/CAD is significantly impacted by how the consumers in the United States reach oil prices. If the US’s demand increases, manufacturers have to order more oil to cater to the rising demand. This can result in rising oil prices, thereby resulting in reducing the value of USD/CAD.

Conversely, if the US’s demand falls, the manufacturer will not need to order in more oil to make goods. Subsequently, the oil prices might fall, which would be bad from the CAD value. So essentially, USD/CAD has a negative correlation.

It’s all about Supply and Demand

Supply and demand are the prominent influencers of the correlation between USD/CAD and crude oil, impacting the demand and supply of US dollars and Canadian dollars.

Export of cruise oil covers a significant percentage of the US currency acquired by Canada. This means that a shift in the price and volume of crude oil will have a considerable impact on the flow of the Greenback into the Canadian dollar.

Furthermore, high crude oil prices also imply a higher flow of USD into Canada due to its exports. This implies that there will be a strong supply of the USD into the Canadian dollar, thereby increasing the value of the Canadian dollar.

Similarly, when the crude price falls, the US dollar supply will be lowered as opposed to the Canadian dollar, leading to a decreasing value of the Canadian dollar.

[wp_quiz id=”97486″]
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Forex Signals

USD/CAD Bearish Bias Continues – Traders Brace for Selling Trade! 

The USD/CAD pair was closed at 1.27513 after placing a high of 1.28269 and a low of 1.27493. The currency pair USD/CAD extended its losses on Wednesday for the 3rd consecutive day amid the US dollar’s weakness and rising crude oil prices. The bearish momentum surrounding the currency pair USD/CAD remained intact due to the unbeatable selling pressure around the greenback and a stronger Canadian dollar on the back of rising crude oil prices amid the improved risk sentiment in the market.

The rising optimism surrounding the vaccine rollouts after the UK regulatory approved the emergency use authorization of the vaccine prepared by AstraZeneca and Oxford University helped recover the market’s energy demand. The rising energy demand added to the crude oil prices that lift the per barrel price of West Texas Intermediate (WTI) to $48.63 on Wednesday.

Another reason behind the rising crude oil prices was the weekly report from EIA about the US crude oil stocks. At 20:30 GMT, the Crude Oil Inventories from last week were declined to -6.1M against the forecasted -3.0M and supported the crude oil prices. The surge in WTI prices gave strength to the commodity-linked currency Loonie that ultimately added losses in the USD/CAD pair on Wednesday.

On the data front, from the US side, at 18:30 GMT, the Goods Trade Balance from November dropped to -84.8B against the predicted -81.5B and weighed on the US dollar that added losses in the currency pair USD/CAD. The Prelim Wholesale Inventories from November also dropped to -0.1% against the predicted 0.7% and supported the US dollar. At 19:45 GMT, Chicago PMI in December raised to 59.5 against the predicted 56.6 and supported the US dollar. At 20:00 GMT, the Pending Home Sales from November fell to -2.6% against the predicted 0.1% and weighed on the US dollar that ultimately added further losses in the USD/CAD pair.

Apart from Crude oil prices and macroeconomic data, the USD/CAD pair was dropped to its fresh weekly lowest level amid the US dollar’s weakness driven by the hopes that Senate will approve US stimulus checks to increase to $2000 from $600. These hopes dragged the US Dollar Index to its lowest level since April 2018 and reached below 89.52 level that added further losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2776 1.2859

1.2734 1.2902

1.2692 1.2943

Pivot point: 1.2818

The USD/CAD is trading bearish at the 1.2737 level, disrupting the support level of 1.2763. This same level is now working as resistance for USD/CAD. On the lower side, a continuation of a selling trend can extend a bearish move until the 1.2697 level. Since today is the last trading day of the year 2020, we are trying not to open unnecessary trades considering lack of volatility and trading volume. Let’s consider taking a sell trade below 1.2763 today. Good luck!  

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Forex Signals

USD/CAD Sideways Trading Continues – Brace to Capture Breakout! 

A day before, the USD/CAD opened at 1.28497, and it has placed a high of 1.28602 and a low of 1.28277 so far. The USD/CAD pair dropped on Monday amid the US dollar’s weakness and the rising crude oil prices. The USD/CAD pair dropped on Monday on the first day of the new trading week as the market’s risk sentiment was improved and supported the risk perceived Canadian Dollar. The risk sentiment in the market was high due to the latest Brexit trade-deal optimism and was further supported by the news of the US stimulus bill.

On Sunday, the US President Donald Trump signed a $2.3 trillion coronavirus relief and government funding bill that added optimism over a last-minute Brexit trade deal and supported the risk perceived Canadian Dollar. The strong Loonie added pressure on the USD/CAD pair that started to decline on Monday.

The US President Donald Trump, who initially called the bipartisan coronavirus bill a disgrace and threatened to reject the bill, backed down from his decision and signed the bill to make it legislation. The bill will include $900 billion in coronavirus relief bill and $1.4 trillion in government funding that would expire after 24 hours. The passing of the second round of the coronavirus relief bill before the US government shutdown soared the risk sentiment and pressured on the US dollar that ultimately added further to the USD/CAD pair’s losses. The greenback was lower in early trading hours on Monday as USD bulls were largely unimpressed by a goodish pickup in the US Treasury bond yields. 

Meanwhile, on the WTI Crude oil front, the energy source prices rose on Monday as they hit $48.25 due to increased risk sentiment in the market and lower US dollar prices. The rising crude oil prices supported the commodity-linked currency Loonie that ultimately added further pressure on the USD/CAD pair on Monday. Another reason behind the declining USD/CAD pair and the Canadian Dollardollar’s strength against the greenback could also be the last-minute Brexit deal. On the last trading session on Thursday, the Canadian Dollar was strong against its counterpart US dollar as Britain secured a long-awaited Brexit deal with the EU. 

The US dollar was already lower because of the Brexit deal against the basket of major six currencies, and Trump’s decision to pass the US stimulus bill added further in it that pushed the US Dollar Index lower on Monday and supported the bearish momentum in USD/CAD pair.

In the absence of any major macroeconomic release from the Canadian or US side, the pair USD/CAD continued declining on the back of the rising Canadian Dollar, improved risk sentiment amid the Brexit deal and US stimulus package, and the declining US dollar and rising Crude oil prices on Monday.


Daily Technical Levels

Support Resistance

1.2826 1.2856

1.2814 1.2874

1.2796 1.2886

Pivot Point: 1.2844

The USD/CAD consolidates in a narrow trading range of 1.2860 – 1.2812 level. The market isn’t moving a lot as the global banks are closed due to the boxing day holiday. The 50 EMA and MACD are suggesting odds of neutral bias in the market. However, we can expect to take a buying trade over the 1.2860 level to target the 1.2930 level. On the lower side, the violation of the 1.2810 level can extend the selling trend until the 1.2760 level. Let’s wait for a breakout to capture a quick buy or a sell trade. Good luck! 

Categories
Forex Signals

USD/CAD Faces Double Top Resistance – A Trade Plan to Follow!  

The USD/CAD pair was closed at 1.27217 after placing a high of 1.27504 and a low of 1.26884. The currency pair USD/CAD dropped on Thursday amid the rising crude oil prices and the US dollar weakness. The USD/CAD pair came back to declining momentum after reversing from Wednesday’s high above 1.2790. The Canadian dollar benefited from a weaker US dollar and rising crude oil prices on Thursday that dragged the currency pair USD/CAD on the downside. On Thursday, the US dollar was weak across the board amid the combination of rising hopes for US stimulus, a rising number of coronavirus cases, increased bond purchases by Fed, and the disappointing jobs report from the US labor department.

The ADP Non-Farm Employment Change in November came in as 40.8K and supported the Canadian dollar that resulted in the declining USD/CAD prices on Thursday. From the US side, at 18:29 GMT, the Philly Fed Manufacturing Index in December dropped to 11.1 against the expected 20.1 and weighed on the US dollar and added further losses in the USD/CAD pair. At 18:30 GMT, the Unemployment Claims from last week advanced to 885K against the expected 817K and weighed on the US dollar, and supported the USD/CAD pair’s downside momentum. For November, the Building Permits advanced to 1.64M against the expected 1.55M and supported the US dollar, and capped further downside in the USD/CAD pair. The Housing Starts in November remained flat as expected 1.55M.

Meanwhile, the greenback was weak across the board as the total number of coronavirus cases surpassed about 17M in the US and weighed on the local currency. The rising hopes for the US stimulus also added in the US dollar pressure as the Democrats and Republicans were moving closer to reach a deal by the end of this week. Furthermore, the Federal Reserve’s latest decision to increase its bond purchases to support the economy through the second wave of the pandemic also added pressure on the US dollar and dragged the USD/CAD prices on the downside.

Furthermore, the WTI crude oil prices also increased on Thursday and reached $48.58 per barrel, supporting the commodity-linked currency Loonie. The strong Loonie then ultimately added further losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2694 1.2790

1.2646 1.2838

1.2597 1.2886

Pivot Point: 1.2742

The USD/CAD pair’s technical side is extending double top resistance at 1.2766 area, and bullish crossover of this can lead USD/CAD price further higher until the next resistance level of 1.2789 level. On the lower side, the support holds around 1.2740 and 1.2709 level. The 50 periods EMA is supporting buying trend. Thus it may extend upward movement until 1.2790 level upon the breakout of 1.2766 support. Overall, the market is lacking volatility as we are heading towards the holiday session. Let’s consider staying bullish over 1.2766 resistance and selling below the 1.2740 support level. Good luck! 

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Forex Signals

USD/CAD Selling Bias Dominates – Sell Signal Update! 

The USD/CAD pair was closed at 1.27392 after placing a high of 1.27892 and a low of 1.26931. The currency pair USD/CAD raised on Wednesday despite the weakness of the US dollar and rising crude oil prices amid the dovish comments from Governor of Bank of Canada Tiff Macklem.

On Wednesday, the US dollar was weak across the board due to the rising hopes for a further stimulus package from Congress and the dovish comments from the Federal Reserve Open Market Committee in its meeting. The bipartisan proposed that originally worth $908 billion was divided into two bills of $748 billion and $160 billion, was closer to reach a deal and get pass by Congress by the end of this week and weighed on the US dollar.

On the other hand, the WTI crude oil prices raised above $47 per barrel on Wednesday amid the declining crude oil inventories in the US over the last week. The US crude oil inventories dropped last week to -3.1M against the forecasted -2.8M and supported the crude oil prices that gave strength to the Canadian dollar that ultimately weighed on the USD/CAD pair on Wednesday.

Meanwhile, on Wednesday, the Governor of Bank of Canada Tiff Macklem warned the nation’s economy that could temporarily shrink again amid the second wave of virus cases and lightened the positive mode of the market that was lifted by the vaccine news. In his last speech of the year on Tuesday, Macklem said that uncertainty persisted and new restrictions could trigger a small contraction at the start of 2021. Sometime later next year the normal activities could resume because of the rollout of vaccines.

On the data front, at 18:30 GMT, the Consumer Price Index (CPI) for November from Canada was increased to 0.1% from the forecasted 0.0% and supported the Canadian dollar. The Common CPI declined to 1.5% against the expected 1.6% and weighed on the Canadian dollar and added gains in the USD/CAD pair. The Median CPI, however, came in line with the expectations of 1.9%. The Trimmed CPI declined to 1.7% against the estimated 1.8%and weighed on the Canadian dollar and supported an upward trend in the USD/CAD pair. 

The Foreign Securities Purchases during October in Canada were declined to 6.92B against the forecasted 10.05B and weighed heavily on the Canadian dollar and supported the gains in the USD/CAD pair. The Wholesale Sales in October surged to 1.0% against the expected 0.7% and supported the Canadian dollar. At 18:32 GMT, the Core CPI from Canada for November came in as 0.2%. The poor macroeconomic data from Canada weighed on local currency and ultimately added strength to the USD/CAD pair.

From the US side, at 18:30 GMT, the Core Retail Sales for November dropped to -0.9% against the expected 0.1% and weighed on the US dollar. The Retail Sales for November also dropped to -1.1% against the expected -0.3% and weighed on the US dollar. At 19:45 GMT, the Flash manufacturing PMI for December increased to56.5 against the expected 55.9 and supported the US dollar and added gains in the USD/CAD pair.

 The Flash Services PMI for December dropped to 55.3 against the expected 55.7 and weighed on the US dollar. At 20:00 GMT, the Business Inventories for October increased to 0.7% against the expected 0.6%and weighed on the US dollar. The NAHB Housing Market Index also dropped to 86 against the expected 88 and weighed on the US dollar and capped further upside in the USD/CAD pair.



Daily Technical Levels

Support Resistance

1.2665 1.2752

1.2632 1.2806 

1.2578 1.2839

Pivot point: 1.2719

The technical side of the USD/CAD is trading at 1.2708 level, holding below an immediate resistance level of 1.2743 mark which is extended by a downward trendline. On the lower side, the next support holds around 1.2693 level and violation of this level can extend further selling until the next support area of 1.2650 level. The MACD and RSI are in support of selling while the 50 periods EMA is dispensing a strong selling bias in the Loonie. let’s consider taking a selling trade below 1.2743 level until 1.2695 level.

Entry Price – Sell 1.27107

Stop Loss – 1.27507

Take Profit – 1.26607

Risk to Reward – 1:1.25

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Bearish Bias Dominates – Descending Triangle Pattern in Play! 

The USD/CAD pair was closed at 1.26982 after placing a high of 1.27713 and a low of 1.26878. After placing gains for two consecutive days, the USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices.

The US dollar was weak across the board on Tuesday as the hopes for further stimulus measures from the US Congress increased. The House Speaker Nancy Pelosi called a meeting of Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, and House Majority Leader Kevin McCarthy to discuss the final government funding and coronavirus relief bill.

The optimism that Republicans and Democrats will reach a deal over the bipartisan package of coronavirus added weight on the US dollar and dragged the USD/CAD pair on the downside. Furthermore, the rising risk sentiment in the market and the increasing hopes that vaccine rollouts will help in global economic recovery raised the demand for WTI crude oil prices that gave strength to the commodity-linked Loonie and ultimately added weight on the USD/CAD pair.

On the data front, at 18:13 GMT, the Housing Starts raised to 246K against the forecasted 220K and supported the Canadian dollar that added pressure on the USD/CAD pair, and added in its losses on Tuesday. At 18:30 GMT, the Manufacturing Sales from Canada dropped to 0.3% against the forecasted 0.5% and weighed on the Canadian dollar. 

From the US front, at 18:30 GMT, the Empire State Manufacturing Index for December declined to 4.9 against the forecasted 6.3 and weighed on the US dollar that added losses in USD/CAD pair. The US Import Prices in November also fell to 0.1% against the forecasted 0.3% and weighed on the US dollar that ultimately added further losses in the USD/CAD pair. At 19:15 GMT, the Capacity Utilization Rate from the US for November rose to 73.3% against the forecasted 73.1% and supported the US dollar. The Industrial Production in November also increased to 0.4% against the forecasted 0.3% and supported the US dollar that limited the downward momentum in the USD/CAD pair on Tuesday.

Furthermore, the US dollar was also weak across the board on Tuesday because of the rising number of coronavirus cases in the region. The hospitalization rate in the US also increased as a record of 109,331 people were in the hospitals for coronavirus in the US in a single day over the weekend. The death toll has also surpassed 300,000 levels in the US, and this has feared the nation despite the vaccine rollout. These fears added weight on the local currency US dollar that ultimately added in the downward momentum of the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2665 1.2752

1.2632 1.2806

1.2578 1.2839

Pivot Point: 1.2719

The technical side of the USD/CAD is trading at 1.2728 level, holding below an immediate resistance level of 1.2743 mark which is extended by a downward trendline. On the lower side, the next support holds around 1.2693 level and violation of this level can extend further selling until the next support area of 1.2650 level. The MACD and RSI are in support of selling while the 50 periods EMA is dispensing a strong selling bias in the Loonie. let’s consider taking a selling trade below 1.2743 level until 1.2695 level. Good luck! 

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Forex Signals

USD/CAD Violates Descending Triangle Pattern – Signal Update! 

During Monday’s Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around below the 1.2750 level due to the broad-based U.S. dollar weakness. The prevalent downtrend in the greenback was mainly tied to the fresh optimism over a potential vaccine for the highly contagious coronavirus disease, which kept the market trading sentiment positive and undermined the safe-haven USD dollar. Furthermore, the U.S. dollar losses were further bolstered by the renewed probabilities that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. 

Across the pond, the reason for the declines in the currency pair could also be attributed to the fresh upticks in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were supported by prevalent optimism over a potential vaccine for the highly infectious coronavirus disease, which ultimately fueled hopes for a recovery in fuel demand and contributed to the crude oil price gains. As of writing, the USD/CAD currency pair is currently trading at 1.2755 and consolidating in the range between 1.2745 – 1.2764.

As we already mentioned, the market trading sentiment represented positive performance on the day as the bullish appearance of Asia-Pacific stocks and upticks of the U.S. 10-year Treasury yields tend to highlight the risk-on mood being supportive by optimism over a potential vaccine/treatment for the highly infectious coronavirus. It is worth recalling that the U.S. Food and Drug Administration (FDA) provided emergency use permission to BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE: PFE) and BioNTech SE (F:22UAy) on Dec. 11. The approval will see the first U.S. deliveries of BNT162b2 later in the day, which lifted hopes that the world’s largest economy will likely see a reduction in the COVID-19 cases.

At the USD front, the broad-based U.S. dollar failed to erase its overnight losses and remained under pressure on the day mainly due to the market risk-on tone. Apart from this, coronavirus’s resurgence keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the greenback under pressure. On the other hand, the U.S. dollar losses were further bolstered by the expectations that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. However, the U.S. dollar losses could be considered the major factor that kept the currency pair lower. Meantime, the U.S. Dollar Index, which tracks the greenback against a bucket of other currencies, dropped by 0.03% to 92.487 by 10:02 PM ET (2:02 AM GMT).

At the crude oil front, WTI crude oil prices remained well bid around closer to $47.00 on the day, backed by the prevalent optimism over a potential vaccine for the highly infectious coronavirus disease, which ultimately fueled hopes for a recovery in fuel demand and contributed to the crude oil price gains. Apart from this, the reason for the crude oil gains could also be associated with fresh, positive reports suggesting an extension of Brexit talks between the U.K. and the European Union (E.U.), which eased global fuel demand worries and contributed to the crude oil price gains. Thus, the crude oil prices’ upticks underpinned the commodity-linked currency the Loonie and exerted some downside pressure on the currency pair. 

In the absence of significant data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 


Daily Support and Resistance

S1 1.2613

S2 1.2687

S3 1.2727

Pivot Point 1.276

R1 1.28

R2 1.2833

R3 1.2907

Entry Price – Sell 1.274

Stop Loss – 1.2733

Take Profit – 1.27

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Market Analysis

USD/CAD Approaching Trendline Resistance – Can We Setup a Sell Limit?

The USD/CAD pair was closed at 1.27385 after placing a high of 1.28288 and a low of 1.27064. The USD/CAD pair fell a day before after placing gains for three consecutive days amid the broad-based US dollar weakness and the rising crude oil prices. On Thursday, the USD/CAD pair fell to its lowest since April 2018 after the US dollar became weak across the board. The greenback suffered as its rival currency raised on Thursday amid the release of further stimulus measures from ECB. 

The ECB extended its bond-buying scheme and issued further stimulus measures on Thursday to support the Eurozone economy from the coronavirus pandemic. The additional support from ECB raised the hopes of the quick economic recovery of the Eurozone economy. It supported the single currency Euro that ultimately added weight to the US dollar. The US dollar was also under pressure as Congress has still not issued a second round of stimulus packages due to Democrats and Republicans’ stalemate over the size of the package. The weak US dollar added weight to the USD/CAD pair on Thursday.

Meanwhile, the Crude oil prices rose by 4.4% to above the $47.7 level on Thursday, and it was the highest level in months. The rising risk sentiment in the market related to vaccine optimism and quick global economic recovery with the release of stimulus measures from big nations added that energy demand would rise, and it supported the Crude oil prices.

On Thursday, the rising crude oil prices added strength in the Canadian dollar that ultimately weighed on the USD/CAD pair and added in its losses.

On the data front, at 18:30 GMT, the CPI for November advanced to 0.2% against the forecasted 0.1% and supported the US dollar. The Core CPI for November also raised to 0.2% against the anticipated 0.1% and supported the US dollar. The Unemployment Claims from last week rose to 853K against the estimated 723K and weighed on the US dollar added in the losses of the USD/CAD pair.

The US dollar was also weak because of the higher unemployment claims last week due to the state governments’ rising number of restrictive measures. The weak US dollar supported the bearish trend in the USD/CAD pair on Thursday. Furthermore, a Deputy Governor of the Bank of Canada, Paul Beaudry, said that the central bank was monitoring rising housing prices on Thursday. It kept the interest rates low to help the borrowers cope with the coronavirus pandemic. 

Beaudry said that BoC had lowered borrowing costs so that homebuyers can better carry the monthly burden of mortgages. He added that before a bank increases the interest rates, it wants everyone to work on a sustainable basis and the economy back to full capacity. He also stated that a whole set of businesses was on the edge of falling over due to the second wave of coronavirus, although there have not been too many bankruptcies. These comments from Beaudry added strength to the Canadian dollar and weighed on the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2775 1.2843

1.2738 1.2872

1.2708 1.2910

Pivot point: 1.2805

The USD/CAD pair is trading with a bullish bias today at the 1.2778 level, holding below an immediate resistance level of 1.2800. The resistance level is extended by a downward trendline, which suggests odds of selling bias in the market. On the lower side, the support stays at the 1.2722 level while the 50 periods EMA also holds around the 1.2836 level suggesting bearish bias in the market. The MACD is crossing over into the bullish zone, suggesting odds of buying trend continuation in the market. That’s why we are not entering the market right now. Let’s wait for the market to test and close below the 1.28300 area, and then we can take a sell trade. Good luck! 

Categories
Forex Signals

USD/CAD Sideways Channel Remains Intact – Brace to Trade Breakout! 

The USD/CAD pair was closed at 1.28179 after placing a high of 1.28332 and a low of 1.27691. The USD/CAD pair was choppy on Wednesday as it dropped to weekly lows in the early session but recovered all of its losses in the late session. The Bank of Canada released its interest rate decision on Wednesday that drove the USD/CAD pair lower in early trading hours. Later the crude oil prices and the strength of the US dollar pushed the pair higher on board.

On Wednesday, the Bank of Canada held rates at 0.25% and reiterated intentions to keep interest rates at the same level until at least 2023 as the Canadian economic recovery from the coronavirus pandemic was proceeding in line with the expectations.

The Bank said that the new infections and lockdowns continue to hold back the Canadian economy. Bank also mentioned that stronger demand for energy sources had pushed oil prices to boost the Canadian dollar. As well, the looming vaccines rolling out were also helping the Canadian dollar.

The Bank of Canada said that the news on the development of effective vaccines provided reassurance that the pandemic will end and more normal activities will resume, although the pace and breadth of the global rollout of vaccinations remain uncertain. However, there were no surprises on Wednesday from the Bank of Canada that weighed on Loonie and supported the upward trend in the USD/CAD pair.

Meanwhile, the declining crude oil prices on Wednesday after the release of US Crude oil stockpiles data weighed on Loonie. For the last week, the US crude oil inventories raised to 15.2M against the expectations of -0.9M and weighed on crude oil prices that added losses in the commodity-linked currency Loonie and supported the upward momentum in the USD/CAD pair.

Moreover, the US dollar was also strong on Wednesday amid multiple reasons, including deteriorated risk sentiment from Pfizer’s vaccine adverse reaction on two people, faded hopes for quick delivery of second round of US stimulus measure, and the rising safe-haven demand after the increased number of coronavirus cases in the US. The strong US dollar also helped the USD/CAD pair’s gains to persist in the market on Wednesday.

On the data front, at 20:00 GMT, the Final Wholesale Inventories for October raised to 1.1% against the projected 0.9% and weighed on the US dollar. The JOLTS Job Opening for October also surged to 6.65M against the estimated 6.30M and supported the US dollar that added further gains in the USD/CAD pair. On the data front, at 20:00 GMT, the Final Wholesale Inventories for October raised to 1.1% against the projected 0.9% and weighed on the US dollar. The JOLTS Job Opening for October also surged to 6.65M against the estimated 6.30M and supported the US dollar that added further gains in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2787 1.2852

1.2745 1.2875

1.2722 1.2917

Pivot point: 1.2810

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of market volatility. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It seems like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

Categories
Forex Signals

USD/CAD Trades Descending Triangle – Traders Loom for a Breakout!

The USD/CAD pair was closed at 1.28286 after placing a high of 1.28254 and a low of 1.27678. The USD/CAD pair was raised on Tuesday due to declining crude oil prices and improving the market’s risk sentiment. The risk sentiment in the market surged on Tuesday after a combination of supporting factors. The rising hopes for global economic recovery after the latest news that Great Britain has officially started using Pfizer coronavirus vaccine to treat coronavirus patients on Tuesday added to the market’s risk sentiment.

Another factor involved in the risk mood enhancement was the rising demand for a US coronavirus stimulus package. The continuous talks between Democrats and the Republicans over the stimulus package and the agreement of both sides over a bipartisan proposal of a $908 billion package also supported the market’s risk sentiment as it will enhance the US economic recovery.

Meanwhile, the latest comments from the foreign minister of China, Wang Yi, that Beijing was open to restarting its relationship with the US also added to the market’s risk flows. Wang declared that a year of escalating tensions between both countries had pushed them to a critical historical juncture. He also said the time has come that objectivity and rationality should bring back in the US policy towards China.

He stated that both sides should restart the dialogues and get back on the right track to rebuilding mutual trust in the next Sino-US relations phase. Wang blamed some Americans’ outdated Cold War mentality for the growing division between the US and China. The raised risk sentiment helped the USD/CAD pair rose for the second consecutive day.

On the data front, at 01:00 GMT, the Consumer Credit for October from the US fell to 7.2B against the estimated 17.6B and weighed on the US dollar. At 16:00 GMT, the NFIB Business Index declined to 101.4 against the anticipated 102.6 in November and weighed on the US dollar that capped further gains in the USD/CAD pair. At 18:30 GMT, the Revised Nonfarm Productivity for the quarter declined to 4.6% against the projected 4.9% and supported the US dollar and supported the USD/CAD pair’s an upward trend. The Revised Unit Labor Costs for the quarter grew in as -6.6% against the projected -8.9%, supported the US dollar and pushed the pair on the upside. At 20:00 GMT, the IBD/TIPP Economic Optimism came in as 49.0 in December compared to the previous 50.0.

Meanwhile, the USD/CAD pair’s gains were also supported by the declining Crude oil prices on Tuesday. The Crude oil prices posted losses on Tuesday and reached $45.13 on the day ahead of the American Petroleum Institute’s weekly crude oil stock data. The declining crude oil prices weighed on commodity-linked currency Loonie and ultimately added strength in the USD/CAD pair.

Furthermore, the Canadian dollar was also under pressure on Tuesday ahead of Wednesday’s Bank of Canada policy meeting. The central bank is expected to hold its interest rates at the same level, but the bank’s tone could affect the Canadian dollar as a positive message will act as a vote of confidence in the economy and support the local currency and vice versa.


Daily Technical Levels

Support Resistance

1.2777 1.2839

1.2740 1.2864

1.2715 1.2901

Pivot point: 1.2802

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of market volatility. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It seems like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

Categories
Forex Signals

USD/CAD Breaking Below Double Bottom Level – Selling Bias in Play! 

The USD/CAD pair was closed at 1.27993 after placing a high of 1.28328 and a low of 1.27738. After posting losses for four consecutive days, the USD/CAD pair raised on Monday amid the US dollar’s strength and declining crude oil prices. On Monday, the US dollar was strong in early European trade as the coronavirus cases continued to rise and lockdowns expanded that added weight on the hopes of the US economic recovery. The US Dollar Index that tracks the greenback against the basket of six other currencies raised by 0.3% to 90.993 and supported the USD/CAD pair’s an upward trend.

The rising number of coronavirus cases in the California State pushed its governor to extend the time duration of imposed restrictive measures and raised the safe-haven appeal to impact the US economic recovery. The rising demand for safe-haven added strength in the greenback that pushed the USD/CAD pair higher.

The recent sanctions and travel ban on 14 Chinese officials from the US government also added the appeal for safe-haven as it would escalate the dispute between the world’s two biggest economies. The rising safe-haven appeal added strength to the greenback and supported the USD/CAD pair’s an upward trend. Meanwhile, the WTI crude oil prices on Monday also declined to $45.34 per barrel level and weighed on Loonie’s commodity-linked currency. The declining Canadian dollar also added to the upward momentum of the USD/CAD pair.

The Canadian dollar was the second worst-performing currency among the G10 currencies on Monday, partially because of the profit-taking in the wake of last Friday’s much stronger than expected November jobs report. Besides, the risk-off market mood weighed on risk-sensitive Loonie and added strength in the USD/CAD pair. On the data front, at 20:00 GMT, the Ivey PMI from Canada raised to 52.7 against the forecasted 52.3 and supported the Canadian dollar that capped further gains in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2773 1.2790

1.2765 1.2799

1.2756 1.2807

Pivot point: 1.2782

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of volatility in the market. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It looks like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

Categories
Forex Signals

USD/CAD Completes 23.6% Fibonacci – What’s Next? 

The USD/CAD closed at 1.27841 after placing a high of 1.28735 and a low of 1.27720. The USD/CAD pair extended its losses towards its lowest level since May 2018 amid the strength of the Canadian dollar against the US dollar and the rising crude oil prices. On Friday, the Canadian dollar outlook improved on the expectations that the currency will benefit from the domestic economic stimulus and the rollout of the coronavirus vaccine. On Monday, the Canadian Finance Minister Chrystia Freeland forecasted the budget deficit to hit a historic C$382 billion on coronavirus emergency aid. She also added that C$100 billion would be rolled out in stimulus once the virus came under control.

These statements from the Canadian Finance Minister added strength to the Canadian dollar as the hopes for Canadian economic recovery increased. The strong Canadian dollar added heavy pressure on the USD/CAD pair on Friday and dragged the pair on the downside.

Meanwhile, the Canadian dollar was also strong because of the positive macroeconomic data on Friday. At 18:30 GMT, the Employment Change from Canada raised to 62.1K against the forecasted 22.0K and supported the Canadian dollar and added losses in USD/CAD pair. 

The Unemployment Rate from Canada dropped to 8.5% against the forecasted 9.0% and supported the Canadian dollar and supported the USD/CAD pair’s downward trend. The Trade Balance from Canada came in as -3.8B against the forecasted -3.2B and weighed on the Canadian dollar.

From the US side, at 18:30 GMT, the Average Hourly Earnings raised to 0.3% against the estimated 0.1% and supported the US dollar, and capped further losses in the USD/CAD pair. The Non-Farm Employment Change declined to 245K against the estimated 480K and weighed on the US dollar and supported the USD/CAD pair’s losses. The Unemployment Rate dropped to 6.7% against the estimated 6.8% and supported the US dollar. The Trade Balance from the US came in as -63.1B against the estimated -64.7B and supported the US dollar. 

At 20:00 GMT, the Factory Orders for November raised to 1.0% against the estimated 0.8%, supported the US Dollar, and capped further USD/CAD pair losses. Most of the US dollar economic data came in favor of the US dollar, but the NFP employment change or the job creation by the US economy fell short of expectations and weighed on the US dollar that added losses in the USD/CAD pair.

Another important factor involved in the USD/CAD pair’s losses on Friday was the rising crude oil prices. The price of crude oil, one of Canada’s major export, rose on Friday above $46 per barrel after the coronavirus vaccine’s speedy approval that would boost the global economic recovery and ultimately increase the energy demand. The higher crude oil prices supported the commodity-linked currency Loonie and added pressure on the currency pair USD/CAD on Friday.


Daily Technical Levels

Support Resistance

1.2825 1.2918

1.2791 1.2977

1.2733 1.3011

Pivot point: 1.2884

The USD/CAD slipped to trade at a 1.2811 level, holding above an immediate support level of 1.2775. Above this level, the commodity currency pair has formed a Doji candle, suggesting odds of selling bias until the 1.2770 level. Taking a look at the 4-hour timeframe, the USD/CAD pair has closed a bullish engulfing pattern at the 1.2811 level, and it may head upward until the 38.2% Fibonacci retracement level of 1.2837 level. Bullish trend continuation can lead to its prices further higher until the next resistance level of the 1.2904 level marks a 61.8% Fibonacci level. Good luck! 

Categories
Forex Signals

USD/CAD Bearish Bias Seems to Halt – Eyes on U.S. NFP Figures! 

The USD/CAD pair was closed at 1.28619 after placing a high of 1.29411 and a low of 1.28519. The USD/CAD pair extended its losses for the 3rd consecutive day on Thursday due to broad-based U.S. dollar weakness and the rising crude oil prices.

The USD/CAD fell to its lowest since October 2018 on Thursday as the U.S. Dollar Index (DXY) reached 90.50 level, its lowest for 31 months. The U.S. dollar weakness could be attributed to the latest progress made in the talks of stimulus relief package in the U.S.

The Top Democrats officials, including President-elect Joe Biden, House Speaker Nancy Pelosi, and the Senate Minority Leader Chuck Schumer, have said that they favored a $908 billion worth bipartisan bill for now as it was the starting step towards the stimulus package. These comments from Democrats raised hopes that a deal might be reached between Republicans and Democrats. Both parties have a shared view that there was a need for a 2020 stimulus package in the economy and that a deal should be reached soon.

This progress raised the hopes and optimism in the market related to the U.S.’s stimulus package and weighed heavily on the U.S. dollar that ultimately added in the losses of the USD/CAD pair. Meanwhile, the WTI crude oil prices increased on Thursday as producers, including Saudi Arabia and Russia, resumed discussion to agree on how much crude to pump in 2021 after earlier talks failed to compromise how to tackle the weak oil demand coronavirus pandemic.

In late Thursday, OPEC+ announced after three days of discussion that they have agreed to increase the production by 500,000 barrels per day beginning in January. This will bring the total production cuts at the start of next year to 7.2 million BPD. On Thursday, the rising crude oil prices added strength in the commodity-linked Loonie that added further pressure on the USD/CAD pair.

On the data front, at 17:30 GMT, the Challenger Job Cuts for the year in November came in as 45.4%against the previous 60.4%. At 18:30 GMT, the Unemployment Claims from last week fell to 712K against the expected 775K and supported the U.S. dollar. At 19:45 GMT, the Final Services PMI for November rose to 58.4 against the forecasted 57.5 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI stayed as forecasted 55.9.


Daily Technical Levels

Support Resistance

1.2898 1.2950

1.2877 1.2981

1.2847 1.3002

Pivot point: 1.2929

The USD/CAD traded in a selling mode, falling below the 1.2885 level to test the support area of the 1.2845 level. Bearish crossover of 1.2845 level can extend selling bias until 1.289 level. We opened a selling trade during the European open, but it seems to consolidate sideways ahead of the NFP figures. Here’s a trading plan for now…

Entry Price – Sell 1.28485

Stop Loss – 1.28885

Take Profit – 1.28085

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

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Forex Signals

USD/CAD Bearish Continues to Dominate the Market- Sell Signal In-Play

The USD/CAD pair was closed at 1.29183 after placing a high of 1.29584 and a low of 1.29098. The USD/CAD pair dropped for the second consecutive day on Wednesday towards its lowest since October 2018 amid the broad-based US dollar weakness and rising crude oil prices.
The US dollar was weak across the board on Wednesday as the hopes for further stimulus relief bill from Congress rose day by day and calls for its from top officials. The prospects of a renewed stimulus bill to support the US economy through the pandemic crisis weighed on the local currency US dollar and weighed on the USD/CAD pair.

After the vaccine development from various drug companies, the ongoing risk sentiment also added weight to the safe-haven greenback. The US dollar index plunged to its lowest in 30 months on Wednesday to 91.10 level and added pressure on the USD/CAD pair. Meanwhile, Pfizer and BioNtech received approval from the UK Administration on Wednesday and became the first to use their vaccine widely. This optimistic report added strength to the risk sentiment and weighed on the US dollar that dragged the currency pair USD/CAD on the two-year lower level.

Meanwhile, the WTI Crude oil prices raised on Wednesday to near $46 per barrel amid declining crude oil stockpiles from the US on the day and added strength in the commodity-linked currency Loonie ultimately added in the losses of USD/CAD pair.

Furthermore, on the data front, at 18:30 GMT, the Labor Productivity for the quarter from Canada came in as -10.3% against the forecasted -6.9% and supported the Canadian Dollar and added losses in USD/CAD pair. From the US front, at 18:15 GMT, the ADP Non-Farm Employment Change for November declined to 307K against the expected 433K and weighed on the US dollar and added losses in the USD/CAD pair.


Daily Technical Levels
Support Resistance
1.2902 1.2984
1.2873 1.3037
1.2820 1.3066
Pivot point: 1.2955

On the technical side, the commodity currency pair USD/CAD is trading with a selling bias at the 1.2939 level, having crossed below the 1.2939 support level, which is now anticipated to work as a resistance. On the 4 hour timeframe, the USD/CAD has produced a downward channel, which supports the selling bias in the Loonie. Closing of candles below the 1.2945 level may assist us catch a quick selling trade. Good luck!

Categories
Forex Signals

USD/CAD Breaking Below Intraday Support – Quick Sell Trade!

The USD/CAD pair was closed at 1.29331 after placing a high of 1.30087 and a low of 1.29277. The USD/CAD pair fell on Tuesday despite the declining WTI crude oil prices due to weak US dollar demand on the day.
The USD/CAD pair dropped on the day as the US dollar was weak across the board after the release of US macroeconomic figures and also because of the rising hopes for the US stimulus package after the testimony of Jerome Powell and Steven Mnuchin.

On the data front, at 18:30 GMT, the Canadian Gross Domestic Product in October declined to 0.8% against the expected 0.9% and weighed on the Canadian dollar but failed to cap losses in the USD/CAD pair as the focus of investors was more towards the weakness of US dollar on the day. At 19:30 GMT, the Manufacturing PMI from Canada for November came in line with the forecasts of 55.8.

Whereas, on the US dollar front, at 20:00 GMT, the ISM Manufacturing PMI for November declined to 5.75 against the anticipated 5.9 and weighed on the US dollar and added further losses in the USD/CAD pair. For October, the Construction Spending rose to 1.3% from the projected 0.8% and supported the US dollar. The ISM Manufacturing Prices for November also raised to 65.4 against the anticipated 65.0 and supported the US dollar. The Wards Total Vehicle Sales from the US declined to 15.6M against the forecasted 16.1M and weighed on the US dollar that added further pressure on the USD/CAD pair on Tuesday.

Meanwhile, the hopes for further stimulus aid in the US from Congress started to rise as Jerome Powell called the outlook for the United States economy extraordinarily uncertain due to increased coronavirus cases and deaths. The US health officials have said that vaccinating Americans will hopefully be started by mid-December as the death rates have risen to an alarming level. All these things included US stimulus hopes, a rising number of coronavirus cases, and the weak macroeconomic data added heavy pressure on the US dollar that dragged the USD/CAD pair lower despite the declining crude oil prices on Tuesday.

The WTI Crude Oil prices also declined on Tuesday after the OPEC+ meeting was reportedly delayed until Thursday to allow for more negotiations. It came in as UAE signaled that it would not support the three months extension of current output cuts by OPEC+. Furthermore, Saudi Arabia also said that it was considering stepping down from the co-chair of the OPEC+ JMMC as the country was unhappy with the things going on recently.

The declining crude oil prices due to the delayed OPEC+ meeting also weighed on commodity lined Loonie, but it failed to reverse the USD/CAD pair’s direction as the focus of the market was solely on the US dollar’s weakness on Tuesday.


Daily Technical levels
Support Resistance
1.2902 1.2984
1.2873 1.3037
1.2820 1.3066
Pivot point: 1.2955

On the technical front, the USD/CAD pair is trading with a bearish bias at the 1.2939 level, having crossed below the 1.2939 support level, which is now likely to work as a resistance. On the 4 hour timeframe, the USD/CAD has formed a downward channel, which supports the selling bias in the Loonie. Closing of candles below the 1.2945 level may help us capture a quick selling trade. Check out a trading plan…

Entry Price – Sell 1.29237
Stop Loss – 1.29637
Take Profit – 1.28837
Risk to Reward – 1:1
Profit & Loss Per Standard Lot = -$400/ +$400
Profit & Loss Per Micro Lot = -$40/ +$40
Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.
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Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Breaks Below Support Level – Weaker Dollar In Play!

The USD/CAD pair was closed at 1.29907 after placing a high of 1.30247 and a low of 1.29719. The USD/CAD pair dropped on Friday after posting gains for two consecutive sessions amid the broad-based US dollar weakness.

On Thursday night, the US President Donald Trump said that he would be leaving the White House office as the Electoral Votes were in favor of Joe Biden. The smooth transition of power in the White House was not expected and weighed on the US dollar as Biden has promised to issue massive financial support for the pandemic-hit economy.

Biden has been fighting for a larger stimulus package from Congress since pre-elections, and now as he has won the US Presidency, he would likely deliver a larger fiscal aid to an economy that will add pressure on the US dollar and markets was weighing on the USD/CAD pair.
Another factor involved in the declining USD/CAD pair prices was the rising Crude oil prices. WTI crude oil prices reached the $45.65 level on Friday amid the rising optimism in the market. The risk sentiment improved after several pharmaceutical companies started reporting their vaccine’s efficacy in preventing the coronavirus.

Pfizer and BioNtech started the race to approve US FDA emergency authorization use of the vaccine, and Moderna and AstraZeneca followed them. The hopes that the global economy will soon be free from the pandemic and the social activities will resume to pre-pandemic level raised the bars for increased demand for energy sources. The hopes that energy demand will rise supported the crude oil prices that eventually added strength in the commodity-linked currency Loonie and added weight on USD/CAD pair on Friday.

There was no macroeconomic data to be released from both sides on Friday due to Thanksgiving Holiday, and the pair USD/CAD followed the US dollar’s movement ad Crude oil movement on Friday.


Daily Technical Levels
Support Resistance
1.2992 1.3028
1.2972 1.3044
1.2957 1.3064
Pivot point: 1.3008

Entry Price – Sell 1.29684

Stop Loss – 1.30084

Take Profit – 1.29284

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Violates Choppy Session – Bearish Setup in Play! 

The USD/CAD pair was closed at 1.30060 after placing a high of 1.30288 and a low of 1.29860. The currency pair USD/CAD rose to1.3030 level in the early trading session but failed to remain there and started to decline on the back of US dollar weakness and the rising crude oil prices on Wednesday.

The US’s mixed macroeconomic data failed to help the greenback gather strength against its rival currencies and forces the USD/CAD pair to lose most of its daily gains in the late trading session. There was no macroeconomic data from the Canadian side, so the pair followed the US data on Wednesday.

On the data front, at 18:30 GMT, the Prelim Gross Domestic Product for the third quarter remained flat at 33.1%. The Unemployment Claims from last week surged to 778K against the projected 732K and weighed on the US dollar. The Core Durable Goods Orders for October surged to 1.3% against the projected 0.5% and supported the US dollar. The Durable Goods Orders rose to 1.3% from the forecasted 1.0% and supported the US dollar. The Prelim Wholesale Inventories for October rose to 0.9% against the expected 0.4% and weighed on the US dollar.

The New Home Sales for October rose to 999K against the forecasted 972K and supported the US dollar. The Personal Income fell to -0.7% from the projected 0.0% and weighed on the US dollar. The Personal Spending raised to 0.5% from the anticipated 0.4% and supported the US dollar.

On the other hand, the weekly report published by the US Energy Information Administration (EIA) showed that the Crude Oil stocks declined by 0.75M barrels last week and boosted oil prices. 

The WTI crude oil raised above the $46 level on Wednesday and gave strength to the Canadian dollar that added pressure on the USD/CAD pair.

However, the pair managed to remain on the positive side as the market mood was still risky due to the rising hopes of global economic recovery from the latest progress made in coronavirus vaccines from Pfizer & BioNtech, Moderna, and AstraZeneca.

Meanwhile, from Canada, almost 1,373 cases of coronavirus were reported, along with 35 additional deaths in Ontario. The total number of deaths from coronavirus in Toronto reached 3554 on Wednesday. The currency pair also remained strong ahead of the FOMC minutes release published in the early Thursday session.

Daily Technical Levels

Support Resistance

1.2979 1.3026

1.2959 1.3051

1.2933 1.3072

Pivot Point: 1.3005

The USD/CAD has violated the sideways trading range of 1.3119 – 1.3035 level. A bearish breakout of the 1.3035 level is likely a further selling trend until the 1.2936 level. The pair forms a neutral candle, suggesting indecision among investors, perhaps due to lack of economic events. Secondly, the investors are expecting thin volatility amid the Thanksgiving holiday. Let’s consider staying bearish below 1.3030 today. Good luck! 

Categories
Forex Fundamental Analysis

USD/CAD Global Macro Analysis – Part 3

Introduction

The exogenous analysis for the USD/CAD pair will involve analyzing factors that significantly contribute to these two currencies’ interaction. Remember, when trading forex, you are trading a currency pair, which means you buy one currency and sell the other. With exogenous analysis, you get the bigger picture regarding the currency pair as a whole. In a sense, the exogenous analysis compares how the endogenous factors between the US and Canadian economies net against each other.

For the exogenous analysis, we’ll focus on:

US and Canadian Interest rate differential

Interest rate differential is the difference between the interest rates in the US and Canadian. When the interest rate in one country s higher than the other, investors will pull their funds from the country with the lower interest rate to invest in high yielding securities in the country with the higher interest rate.

Canada’s interest rate has for most of the year been higher than that in the US. We, therefore, expect that from March 2020, the USD weakened against the CAD. However, since the current interest rate differential is 0%, going forward, we do not expect that it will play a significant role in determining the value of the USD/CAD pair. Hence, we assign it a neutral score of 0.

GDP Growth Differential

A country’s GDP growth is mainly propelled by growth in international trade. Therefore, when the GDP expands, we can expect that the country is becoming a net exporter. That means the demand for its currency increases in the international market, which also increases its value.

Over the years, the Canadian GDP growth rate has outpaced that of the US. However, in the third quarter of 2020, the US GDP growth rate outpaced Canada by 23.1%. Based on our correlation analysis between the GDP differential and the USD/CAD pair, we assign an inflationary score of 2. If this trend continues, we expect a future strengthening of the USD against CAD.

Differences in Trade Balance

The balance of trade helps to show the trade deficits that a country operates in the international market. The trade deficit widens as the country consistently becomes a net importer. Furthermore, the trade deficit can also widen if the value of the goods exported by a country drops while the value of imports increases.

From April 2020, the Canadian trade deficit has been widening as compared to that of the US. In October 2020 data release, the Canadian trade deficit widened by CAD 3.25 billion while the US trade deficit widened by $3.1 billion. Due to its high correlation with the USD/CAD pair, we assign the difference in trade deficit an inflationary score of 3. If this trend persists, we expect it to result in bullish USD/CAD.

Conclusion

Based on the exogenous analysis, the USD/CAD gets an inflationary score of 5. It implies that if the current trend of the exogenous factors persists, we can expect a bullish trend for the USD/CAD pair in the near term.  Now that we know the trend, we can use technical analysis to find accurate entries and exits in this currency pair while keeping the bullish trend in mind.

From the exogenous analysis of the USD/CAD pair, we have observed that the pair is expected to adopt a bullish trend in the near term. Let’s see if this is supported by technical analysis. In the below weekly chart, we can see the pair bouncing off a 2-year support line and from the oversold territory of the Bollinger Bands. This indicates a clear bullish trend in the near future. 

We hope you found this analysis informative. Please let us know if you have any questions in the comments below, and we would love to address them. Cheers.

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Forex Fundamental Analysis

USD/CAD Global Macro Analysis – Part 2

CAD Endogenous Analysis – Summary

The Canadian endogenous factors recorded a score of -11.5, implying a deflationary effect in the CAD as well. This means that according to the Fundamental indicators, the CAD has also lost its value since the year began, but not as much as the USD.

Unemployment Rate

The unemployment rate measures the number of people who do not have jobs and are actively seeking gainful employment. The unemployment rate is used to show business cycles and economic growth because when businesses expand, the demand for labor is higher when the economy is undergoing a contraction, the demand for labor decreases, and the unemployment rate increases.

In October 2020, the Canadian unemployment rate was 8.9% down from the historic highs of 13.7% registered in May 2020. The rate is still higher than the 5.6% average before the onset of the coronavirus pandemic.

Based on our correlation analyses, the Canadian unemployment rate gets a score of -6. It means that in 2020 the unemployment rate has a deflationary impact on the CAD.

Canadian Rate of Inflation

The Canadian CPI is a weighted average of the following categories: Shelter 27.5%, Transportation 9.3%, Food 16.1%, household operations 11.8%, education and recreation 11.8%, clothing 5.7%, health and personal care 5%, and alcohol and tobacco 3%.

The CPI target in Canada is 2%. The Bank of Canada uses monetary policy to maintain inflation within the target range of 2%. An increasing rate of inflation is positive for the CAD.

In October 2020, the annual inflation rate in Canada rose to 0.7 from lows of -0.4 in May 2020, but still below the 2.4 recorded in January.

We assign the Canadian rate of inflation a score of -7, meaning it had a negative impact on the CAD.

Canada Industrial production

Industrial production is used to measure the output from manufacturing, mining, and the utility sectors in Canada.

In August 2020, the industrial production in Canada declined by 9.04%. Based on our correlation analysis of the Canadian industrial production and GDP, we assign it a deflationary score of -5.

Manufacturing sales

The Canadian manufacturing sales measure the value changes in the output from the manufacturing goods in the economy. It can be used to measure the short-term health of the manufacturing sector and, by extension, the health of the overall economy.

In September 2020, the manufacturing sales were worth CAD 53.8 billion, representing a 1.4% increase from August. However, manufacturing sales are still 3.6% below the pre-coronavirus period.

Based on the correlation analysis with the Canadian GDP, we assign an inflationary score of 3 to the manufacturing sales.

Retail sales

The Canadian retail sales data measures the total value that households spend on purchasing goods and services for direct consumption. This value is adjusted for inflation.

Consumption by households accounts for up to 78% of the Canadian GDP. Changes in the retail sales data can be used as a leading indicator of the welfare of households. Higher retail sales imply increased demand in the economy hence higher manufacturing and lower unemployment rates.

The retail sales in September 2020 steadily increased by 1.1% from lows of -26.4% in April. Based on the correlation analysis with the GDP, we assign retail sales a score of 6.

Government debt to GDP ratio

In 2019, Canada’s public debt to GDP was 88.6, representing a 1.26% decline from 89.7 registered in 2018.

In 2020 the government debt to GDP in Canada is expected to rise due to the various stimulus packages necessitated by the coronavirus pandemic. However, based on the past correlation analysis with GDP, we assign a marginal deflationary score of -2 on Canada’s government debt to GDP ratio.

Canada housing starts

The housing starts indicators track the number of new residential buildings that begin construction. It is used as a leading indicator of the demand in the real estate market and demand in the housing market.

In October 2020, the housing starts in Canada were 214,875 units. Based on the correlation analysis with the GDP, we assign Canadian housing starts an inflationary score of 2.5.

Canada Government Budget Value

This indicator measures the value of the Canadian budget in terms of surplus or deficit. It takes into account the difference between revenues collected and the expenditures by the government. The government budget value doesn’t include public debt.

As of August 2020, the Canadian budget deficit was CAD 21.94 billion. Revenue collected by the government during the month dropped by CAD 1.3 billion, while expenditures increased by CAD 42.92 billion due to COVID-19 response measures.

Based on its high correlation with the GDP, we assign a deflationary score of -6.

Business confidence

In Canada, business confidence is measured by the Ivey Purchasing Managers’ Index (PMI). It measures the business expectations and operating environment from the perspective of an operating panel of purchasing managers from both private and public sectors across Canada.

The Ivey PMI focuses on supplier deliveries, purchases, employment, inventories, and prices. Values over 50 imply expansion while below 50 implies contraction.

The Ivey PMI reading for October 2020 was 54.5, indicating expansion. From our correlation analysis, we assign Canadian business confidence an inflationary score of 3.

In our next article, we will analyze the Exogenous factors of both USD and CAD to come to an appropriate conclusion.

Categories
Forex Fundamental Analysis

USD/CAD Global Macro Analysis – Part 1

Introduction

The global macro analysis of the USD/CAD pair involves the analysis of both the endogenous and exogenous factors inherent for both currencies. For this analysis, we’ll focus on analyzing those factors, which significantly impact both these currencies.

Endogenous factors are the fundamental economic factors that drive the GDP and economic growth in a country. These factors include fundamental economic indicators unique to a particular country. Note that although the fundamental economic indicators primarily drive an economy’s GDP, they can also be used to predict interest rate policies that impact the value of a currency. Therefore, we will analyze the endogenous factors that affect both the USD and the CAD.

Exogenous factors are the economic factors that define the relationship between these two currencies.

Ranking Scale

The endogenous factors are ranked on a sliding scale from -10 to +10; it shows their inflationary and deflationary impact on the respective currencies. This ranking scale is determined by the YTD change of the fundamental indicator being reviewed.

In this article, let’s first analyze the Endogenous factors that affect our base currency, that is, the USD.

USD Endogenous Analysis – Summary

While analyzing the endogenous factors affecting the USD, we have focused only on the indicators that significantly impact the economy. Due to the US’s coronavirus-induced economic recession, we can expect a net deflationary impact on the USD. The USD endogenous factors recorded a score of -19.1, implying a deflationary effect on the USD. This essentially means that according to these indicators, the USD has lost its value since the beginning of this year.

Unemployment rate

In the US, the rate of unemployment is used to determine the total percentage of the workforce that is actively looking for gainful employment.

The changes in the unemployment rate are also used to gauge the US economic recovery during the coronavirus pandemic. Reduction in the unemployment rate means that the economy is rebounding since we can deduce that when more companies resume operations,  more workers are employed.

The most recent unemployment rate for the US was 6.9% for October 2020. Notably, this is a significant decline from the historic highs of 14.7% registered in May 2020. Our correlation analyses assign the US unemployment rate a score of -8 in 2020, meaning that the unemployment rate had a deflationary impact on the USD in 2020.

ISM Manufacturing PMI

The Institute of Supply Management (ISM) Manufacturing Purchasing Managers Index (PMI) compiles data on over 400 US companies. This indicator tracks the changes in new export orders, imports, production, supplies and deliveries, inventories, price, employment, new orders, and the backlog of orders. The components of the indicator are weighted as follows: 30% for new orders, 25% for production, 20% for employment, 15% for deliveries, and 10% for inventories.

The US manufacturing sector accounts for about 20% of the overall GDP. When the index is above 50, it shows that the manufacturing sector is expanding, while a reading below 50 shows the sector is contracting.

The most recent publication of the ISM manufacturing PMI for October 2020 was 59.3 showing that the US manufacturing sector is expanding. Our correlation analysis gives the ISM manufacturing PMI a score of 3, meaning it had an inflationary effect on the USD in 2020.

ISM Non-manufacturing Purchasing Managers Index (ISM NMI PMI)

This indicator tracks the activities of over 370 purchasing and supply executives across 62 different services industries. The index aggregates the diffusion of the business activity, new orders, employment, and supplier deliveries in equal weights and seasonally adjusted.

Note that the services sector in the US contributes to about 80% of the overall GDP. When this index above 50, it means that the services sector is expanding. A  reading below 50 shows the sector is contracting.

Based on our correlation analysis, we assign the ISM non-manufacturing PMI a score of 4.4. It means it had an inflationary impact on the USD in 2020.

US rate of inflation

The inflation rate measures the changes in the prices of a basket of goods and services consumed by households. The consumer price index for all urban consumers (CPI-U) gives a better overview of the general population’s inflation rate since urban areas are generally the most populated.

A rapidly increasing inflation rate forebodes future interest rate hikes, which have an inflationary effect on the USD. A consistently dropping inflation rate could imply that interest rate cuts are looming, which depreciates the currency.

Our correlation analysis assigns the US rate of inflation a score of  -6, meaning it had a deflationary impact on the USD.

Gross Federal Debt to GDP ratio

This indicator measures the sustainability of the government’s debt. Effectively, the debt to GDP ratio compares what a country owes to what it produces hence showing its ability to repay its debts. This ratio can be used to determine when a government’s debt is getting unsustainably high. Hence, the higher the ratio, the more likely the default.

While it is normal for countries to operate budget deficit, increasing debt to GDP ratio is acceptable only when the country can sustainably finance its debt repayments at no expense to economic development. Note that the expansionary effect of higher debt to GDP ratio results in lower interest rates, hence, depreciating the domestic currency.

In 2020, the US debt to GDP ratio is 120; and according to our correlation analysis, we assign a score of -9.5, meaning it had a deflationary impact on the USD.

US Consumer Sentiment

The consumer confidence index is used to measure three aspects of the economy from the consumer’s perspective. It measures the consumers’ views on the prevailing economic conditions, their longer-term view on the economy, and personal financial situation.

The surveyed consumers and the questions posed are designed to represent all American households as accurately as possible statistically. Therefore, lower consumer sentiment means that consumers are more likely to reduce their consumption expenditure. Higher consumer sentiment implies that they are likely to increase their expenditure in the economy resulting in higher GDP.

The most recently published data on the US Michigan Consumer Sentiment showed the consumer sentiment was at 77 in November 2020 from yearly highs of 101 in February 2020. From our correlation analysis, we assign the consumer sentiment a score of -3, meaning it had a deflationary impact on the USD.

In the next article, you can find the endogenous analysis of CAD in the USD/CAD currency pair.

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Forex Market Analysis

USD/CAD Breaking Below Triple Bottom – Brace for a Sell Trade! 

The USD/CAD pair was closed at 1.30853 after placing a high of 1.31123 and a low of 1.30452. The USD/CAD pair remained flat during the Monday trading session as the strength of the US dollar kept the pair on the upside while the strength of the Canadian dollar dragged the pair on the lower side simultaneously, which resulted in a flat movement.

The rise in the USD/CAD pair was due to the better-than-expected macroeconomic data on Monday. At 19:45 GMT, the Flash Manufacturing PMI from the US in November raised to 56.7 against the forecasted 52.5, supported the US dollar, and pushed the USD/CAD pair higher. The Flash Services PMI surged to 57.7 against the anticipated 55.8 and kept the US dollar and added gains in the USD/CAD pair.

However, the USD/CAD pair’s gains could not live longer as the improved risk sentiment in the market continuously supported the riskier Canadian dollar. The latest news from AstraZeneca, a British pharmaceutical, said that its vaccine effectively prevented coronavirus. AstraZeneca’s first dosage of vaccine could provide 70% immunity from the virus, whereas the second dosage could provide 90% immunity.

The rising optimism after the vaccine developers’ positive reports gave strength to risk perceived Canadian dollar that added weight on the USD/CAD pair on Monday. Meanwhile, the WTI Crude Oil prices also weighed on the USD/CAD pair after the prices of crude oil rose above the $43 level on Monday amid the rising optimism in the market that, with the progress in vaccine development, the chances for lifting the lockdown restrictions increased that would raise the demand for crude oil.

The rising crude oil prices helped the commodity-sensitive Canadian dollar gather strength against its rival currencies supported by the optimism that coronavirus vaccines will lead to a steady recovery in energy demand. The strong Loonie weighed on the USD/CAD pair, and the pair lost all of its earlier daily gains.

Daily Technical Levels

Support Resistance

1.3079 1.3093

1.3073 1.3101

1.3065 1.3108

Pivot Point: 1.3087


Entry Price – Sell 1.30711

Stop Loss – 1.30711

Take Profit – 1.29911

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

Categories
Forex Signals

USD/CAD Choppy Trading in Play – Brace for a Breakout! 

The USD/CAD closed at 1.30921 after placing a high of 1.30967 and a low of 1.30387. The USD/CAD pair remained on the upward momentum on Friday despite the strength in WTI Crude Oil prices and the Canadian Dollar amid the positive optimism regarding the vaccines. The optimism surrounding the vaccine development from Pfizer and Moderna was also followed by Oxford, the Russian Sputnik V, and China’s Sinovac and raised the market’s risk-on sentiment that supported the risk perceived USD/CAD pair on Friday.

On the data front, at 18:30 GMT, the Core Retail Sales from Canada raised to 1.0% against the expectations of 0.0% and supported the Canadian Dollar. For September, the Retail Sales also grew to 1.1% from the forecasted 0.2% and kept the Canadian Dollar. The NHPI for October came in line with the projection of 0.8%. At 18:32 GMT, the Corporate Profits for the quarter from Canada also came in line with the anticipations of 44.9%.

The Canadian Dollar was strong across the board on Friday due to supportive macroeconomic data and the rising Crude oil prices. The WTI crude oil was higher on Friday above the $42.5 level after the increased optimism about the coronavirus vaccines from across the world. The rising crude oil prices also supported the commodity-linked currency Loonie that capped further USD/CAD pair gains.

Meanwhile, the Canadian health officials warned that daily coronavirus infections could reach 60K per day by the end of December from their current level of 4.8K if people continue to increase their number of daily contacts. The Canadian PM Justin Trudeau said that Canada saw a massive spike in cases and that there was a risk that hospitals could get overwhelmed. He also said that it was frustrating that Canadians would have to do more to contain the virus from what they did weeks ago. These virus tensions across the North kept the Canadian Dollar weak and supported the rising USD/CAD prices on Friday. 

On the US dollar front, the Dollar was strong across the board as the US Federal Reserve Chairman refrained from providing any clues about further easing in the upcoming Fed meeting and supported the USD/CAD pair’s upward momentum.


Daily Technical Levels:

Support Resistance

1.3039 1.3114

1.3007 1.3157

1.2964 1.3189

Pivot point: 1.3082

The USD/CAD pair is trading sideways in between the narrow range of 1.3120 – 1.3045 level. Investors seem to wait for a solid reason to trigger a breakout of the choppy range. The idea will be take a sell USD/CAD pair below 1.3045 level until 1.2937. Conversely, the continuation of a bullish trend over 1.3120 can lead the USD/CAD pair towards 1.3245. Good luck! 

Categories
Forex Signals

Choppy Session Continues in USD/CAD – Brace for a Breakout! 

The USD/CAD closed at 1.30858 after placing a high of 1.31174 and a low of 1.30341. The USD/CAD pair declined on Wednesday amid the broad-based US dollar weakness and the Canadian dollar’s strength on the day. The risk sentiment was improved on Wednesday after Pfizer and BioNtech said that their vaccine was 95% effective in their study. They were going to seek approval from the US for emergency authorization of vaccine in the coming days. This news raised optimism in the market that vaccines will be delivered soon and would help the global economy recover.

The rising risk-sentiment in the market helped risk perceived Canadian dollar gain traction against the US dollar that ultimately added pressure on the USD/CAD pair. Meanwhile, the US dollar was already weak across the board after the chances for a further stimulus package from Congress increased after House Speaker Nancy Pelosi and the Senate Minority Leader Chuck Schumer urged the Senate Majority Leader McConnell to start the talks for fiscal aid.

The US was reporting a rising rate of infection cases that were weighing on its local currency as the virus’s spread was costing record lives. According to Johns Hopkins University, the death toll in the US raised to 250,180, and the fears for economic shutdown to control the virus from being spread increased. The US officials also announced to close the New York schools again from Thursday to fight the pandemic.

The inefficiency of Trump’s administration during the pandemic crisis has cost the United States many American lives. The recent Trump’s refusal to give in his presidency to Joe Biden has also created chaos in the economy has weighed heavily on the US dollar. The US dollar weakness added further to the losses of the USD/CAD pair on Wednesday.

Furthermore, on the data front, at 02:00 GMT, the TC Long Term Purchases rose to 108.9B from the anticipated 41.5B and supported the US dollar. At 18:30 GMT, the Building Permits for October remained flat at 1.55M. The Housing Starts raised to 1.53M from the projected 1.45M and supported the US dollar that ultimately capped further losses in the USD/CAD pair.

From the Canadian side, the Consumer Price Index for October rose to 0.4% against the expected 0.2% and supported the Canadian dollar that weighed on the USD/CAD pair. The Common CPI for the year also surged to 1.6% against the anticipated 1.5% and supported the Canadian dollar that added losses in the USD/CAD pair. The Median and Trimmed CPI for the year came in line with the expectations of 1.9% and 1.8%, respectively.

The positive macroeconomic data and the rising WTI crude oil prices on Wednesday supported the commodity-linked Loonie. The crude oil prices raised above $43.4 per barrel despite the increasing number of crude oil inventories from the US and supported the Loonie that weighed on the USD/CAD pair.


Daily technical Levels

Support Resistance

1.3036 1.3122

1.2991 1.3163

1.2949 1.3208

Pivot Point: 1.3077

The USD/CAD pair is trading over the 1.3060 level, mostly supported by the Retail Sales. A bearish breakout of the 1.3040 level can drive the selling trend until the 1.2935 area. While on the other hand, the resistance stays at the 1.3173 level today. The MACD and RSI support the selling trend; thus, we may consider taking a selling trade only upon the breakout of the 1.3055 level and buying over the 1.3060 level. Good luck! 

Categories
Forex Signals

USD/CAD Holds Above 1.3060 Support – Brace for a Buy Trade! 

The USD/CAD pair was closed at 1.31037 after placing a high of 1.31164 and a low of 1.30631. After placing losses for two consecutive days, the USD/CAD pair raised on Tuesday amid the declining crude oil prices and weak Canadian dollar. The Canadian dollar was weak on Tuesday as the crude oil prices declined after the coronavirus cases surged in the US to an alarming level and forced many states to re-impose lockdown restrictions. The restrictions meant less use and demand for energy and weighed on crude oil prices that were also considered commodity-linked Loonie. The weak Loonie then eventually pushed the USD/CAD pair higher on Tuesday.

The rising hopes of a coronavirus vaccine after the release of Moderna vaccine promising test results and market speculation about a likely OPEC+ agreement to extend output cuts beyond January 2021 failed to offset fears about the economic consequences of the escalating numbers of infections and deaths in Europe and the US. On the data front, the US dollar remains weak after the release of macroeconomic data on Tuesday. At 18:30 GMT, the Core Retail Sales from the US dropped to 0.2% against the expected 0.6% and weighed on the US dollar that capped further gains in the USD/CAD pair. The Retail Sales in October from the US also fell to 0.3% from the anticipated 0.5% and weighed on the US dollar. The Import Prices in the US for October also fell to -0.1% from the expected 0.2%and weighed on the US dollar.

At 19:00 GMT, the Capacity Utilization Rate from the US surged to 72.8% against the estimated 72.3% and supported the US dollar that provided support to the USD/CAD pair’s bullish moves. The Industrial Production remained flat at 1.1% in October. At 20:00 GMT, the Business Inventories for September raised to 0.7% against the expected 0.5% and weighed on the US dollar. The NAHB Housing Market Index from the US surged to 90 from the expected 85 and supported the US dollar that eventually supported the USD/CAD pair’s gains on Tuesday.

From the Canadian side, the Housing Starts for October were released at 18:13 GMT that dropped to 215K from the forecasted 220K and weighed on the Canadian dollar that eventually pushed the USD/CAD pair higher. At 18:30 GMT, the Foreign Securities Purchases were dropped to 4.46B against the projected 5.0B and weighed on the Canadian dollar that ultimately added strength to the USD/CAD pair. The Wholesale Sales from Canada raised to 0.9% against the forecasted 0.4% and supported the Canadian dollar.


Daily Technical Levels

Support Resistance

1.3070 1.3127

1.3037 1.3151

1.3014 1.3184

Pivot point: 1.3094

The USD/CAD pair is trading over the 1.3060 level, mostly supported by the CPI report. A bearish breakout of the 1.3060 level can drive the selling trend until the 1.2935 area. While on the other hand, the resistance stays at the 1.3173 level today. The MACD and RSI are in support of the selling trend; thus, we may consider taking a selling trade only upon the breakout of the 1.3055 level and buying over the 1.3060 level. Good luck! 

Categories
Forex Signals

USD/CAD Choppy Sessions Continues – Traders Brace for a Breakout Setup!

The USD/CAD pair was closed at 1.30730 after placing a high of 1.31379 and a low of 1.30652. The risk perceived Canadian Dollar received another vaccine driven boost on Monday morning after another drug maker, Moderna, announced positive news about their vaccine.
After Pfizer and BioNtech, Moderna became the second company to announce that its vaccine has been proved 94.5% effective in phase-3 clinical trials. The market mood improved after this news as hopes raised that their vaccine might be better than Pfizer’s vaccine as it was 5% more effective in results.

The efficacy rate of Moderna’s vaccine was 94.5% against Pfizer’s & BioNtech’s 90%. The second thing that makes Moderna’s vaccine better was that it can be stored at refrigerator temperature while Pfizer’s vaccine must be kept frozen, which presents a key distribution challenge.
After this news, the risk sentiment improved in the market and supported the Canadian Dollar that ultimately weighed on the USD/CAD pair and dragged the prices of the pair on the downside.

Furthermore, the US dollar was also on the back foot as the rising number of coronavirus cases in the US was weighing on the local currency. The US has reported more than 11 million cases of coronavirus so far that raised the need for the further stimulus package, and weighed on the US dollar that ultimately added in the losses of the USD/CAD pair on Monday.
Meanwhile, the WTI Crude Oil prices raised above the $42 level on Monday on the back of rising optimism related to the vaccine and supported the commodity-linked currency Loonie that ultimately added further pressure on the USD/CAD pair.

Moreover, on the data front, at 18:30 GMT, the Manufacturing Sales from Canada for September dropped to 1.5% against the expected 1.7% and weighed on the Canadian Dollar that capped further losses in the USD/CAD pair on Monday. On the US side, the Empire State Manufacturing Index for November dropped to 6.3 against the expected 13.8 and weighed on the US dollar that added further losses in the USD/CAD pair on Monday.



Daily Technical Levels

Support   Resistance
1.3043      1.3123
1.3013      1.3173
1.2963      1.3203
Pivot point: 1.3093

The USD/CAD pair is trading with a neutral bias, holding below an immediate resistance level of 1.3100. On the 4 hour timeframe, the USD/CAD pair is facing resistance by the downward trendline, and below this, there are strong odds of selling bias until the 1.3028 level. Further selling bias can extend movement until the 1.2934 level as the MACD is also suggesting selling bias. Thus, we should consider selling below the 1.3100 level today. Good luck!

Categories
Forex Signals

USD/CAD Extends Overnight Bearish Moves – Weaker U.S. Dollar in Play! 

During Friday’s Early Asian trading session, the USD/CAD currency pair extended its overnight losses and remain bearish around the 1.3135 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair losses. Moreover, the political uncertainty in the U.S. also weighs on the already weaker U.S. dollar, which adds further burden around the currency pair.

On the contrary, the decline in the crude oil prices tends to undermine the commodity-linked currency the Loonie, which turned out to be one of the leading factors that kept the lid on any additional losses in the currency pair contributes to the currency pair’s losses. However, the crude oil prices were being pressured by the worsening coronavirus (COVID-19) conditions in Europe and the U.K. Apart from this, the crude oil prices’ losses were further bolstered after the EIA’s downbeat inventory numbers, which showed a sharp build-up in U.S. crude oil stocks. As of writing, the USD/CAD currency pair is currently trading at 1.3139 and consolidating in the range between 1.3133 – 1.3147.

Despite the optimism over the potential vaccine for the highly infectious coronavirus disease, the market trading sentiment failed to stop its previous negative performance and remain depressed during the early Asian session on the day, possibly due to the combination of factors. Be it the worrisome headlines concerning Brexit or the tension between the US-China, not to forget the coronavirus issues in the U.S. and Europe, everything has been weighing on the market trading sentiment; as per the latest report, the U.S. sanctions 4- Chinese diplomats over the Hong Kong crackdown. Apart from this, the Trump administration shows a willingness to limit investments in Chinese companies, fueling the already intensified tussle. 

At the coronavirus front, the U.S. coronavirus cases touched a new daily record high, with 140,543 reported. Almost 10.4 million peoples in the U.S. have been infected by the Covid-19 so far. While nearly 242,000 have died so far, according to the Johns Hopkins University report. As in result, New York has announced a 10 p.m. curfew on bars, gyms, and restaurants to curb the spread. Afterward, Chicago also followed the footsteps of New York and restricted activities.

In addition to the U.S., Europe also imposed lockdown again last week, threatening the oil outlook and undermining oil prices. It is worth recalling that Sweden declared a partial lockdown shutting down bars and restaurants for the 1st-time since the virus started. Thus, the back to back lockdowns restrictions keep harming the crude oil demand.

Despite the risk-off market mood, the broad-based U.S. dollar remained depressed. The investors continue to sell U.S. dollars on the back of optimism over the potential vaccine for the highly infectious coronavirus disease. Moreover, the losses in the U.S. dollar could also be associated with political uncertainty in the U.S. However, the U.S. dollar losses could be considered the major factor that kept the currency pair under pressure. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 92.957.

The crude oil prices dropped further after the U.S. Energy Information Administration reported that crude oil inventories across the country climbed sharply by 4.3 million barrels last week, against expectations for a draw of 913,000 barrels. Moreover, the decline in crude oil prices was further bolstered after Libya’s oil production increased, which eventually raised fears of oversupply and undermined the crude oil prices. Hence, the declines in oil prices undermined demand for the commodity-linked currency the Loonie and became the key factor that helped the currency pair limit its deeper losses. 

In the absence of the major data/events on the day, the market traders will keep their eyes on the ongoing drama surrounding the U.S. elections result and updates about the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 


Daily Support and Resistance

S1 1.2933

S2 1.3025

S3 1.3084

Pivot Point 1.3117

R1 1.3176

R2 1.3209

R3 1.3302

Entry Price – Buy 1.31412

Stop Loss – 1.31812

Take Profit – 1.31012

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

Categories
Forex Signals

USD/CAD Heading North – Is It a Good time to go long?

Today in the early Asian trading session, the USD/CAD currency pair successfully extended its previous day recovery streak and remained bullish around above the mid-1.3000 level. However, the bullish sentiment around the currency pair could be attributed to the modest downticks in the crude oil prices, which ultimately undermined the demand for the commodity-linked currency the loonie, and contributed to the currency pair gains. On the contrary, the broad-based U.S. dollar weakness, triggered by the multiple factors, has become one of the major factors that kept the lid on any further gains in the currency pair. Currently, the USD/CAD currency pair is currently trading at 1.3067 and consolidating in the range between 1.3054 – 1.3073.

Despite the renewed optimism about a potential treatment/vaccine for the highly infectious virus, the market trading sentiment has ben flashing mixed signals as the coronavirus woes overshadowed vaccine hopes. However, the increasing market worries over the potential economic fallout from the constant rise in new COVID-19 cases keep weighing on the market trading sentiment. As per the latest report, the country keeps reporting record cases daily, more than 100K per day. Essentially all American states are getting a worse status report of the COVID-19, strengthened by record hospitalizations and daily cases rising past-100,000 in the last few days. As in result, New York has declared a 10 p.m. curfew on bars, gyms, and restaurants to curb the spread. It is also worth mentioning that the COVID-19 hospitalizations in the U.S. exceeded 60,000.

On the bullish side of the story, the prevalent optimism over the potential vaccine for the highly infectious coronavirus disease helps the market trading sentiment limit its deeper losses. The leading vaccine producers like Pfizer and Moderna still show progress over the vaccine for the deadly virus. This was witnessed after the U.S. infectious disease expert Dr. Anthony Fauci said that Moderna could begin analyzing vaccine data within days. However, the market trading mood mostly ignored the U.S. official’s another push to keep vaccine optimism high amid surging virus cases and hospitalizations in the U.S.

Despite the risk-off market sentiment, the broad-based U.S. dollar failed to extend its overnight gains. It edged lower on the day, mainly due to the heavy optimism over the potential vaccine for the highly infectious coronavirus disease. Apart from this, coronavirus’s resurgence keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the greenback under pressure. However, the U.S. dollar losses could be considered the major factor that pushes the currency pair down. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 92.922.

At the crude oil front, the WTI crude oil prices failed to extend its overnight winning streak and remained under some selling pressure on the day. However, the fresh declines in crude oil could be attributed to reports suggesting the next wave of lockdowns throughout the world, which is threatening the crude oil demand once again. Apart from this, the reason for the modest losses in crude oil prices could also be associated with the latest reports suggesting that OPEC’s oil output in October rose by 320,000 BPD in the wake of recovery in Libya’s production. Thus, the pullback in oil prices undermined demand for the commodity-linked currency – the loonie and remained supportive of the USD/CAD pair’s ongoing recovery momentum.

Moving ahead, the market traders will keep their eyes on the U.S. economic calendar, which highlights the latest data concerning U.S. inflation and jobless claims. In the meantime, the Brexit trade talks’ updates could not lose their importance on the day.


Daily Support and Resistance
S1 1.2951
S2 1.3003
S3 1.3032
Pivot Point 1.3055
R1 1.3084
R2 1.3107
R3 1.3158

The USD/CAD is trading with bullish sentiment at 1.3094, facing immediate resistance at 1.3100. Crossing above this level may drive further upward movement until 1.3177 level. On the downside, the USD/CAD may find support at 1.3025, and below this, the next support level stays at 1.2975 level. The MACD is in support of buying; thus, we may look for a buying trade over the 1.3105 level today. Good luck!

Categories
Forex Basic Strategies

Reliable ‘ADX’ Trading Strategy To Trade Forex Major Currency Pairs

Introduction 

We have talked a lot about trading strategies involving MACD, RSI, Volume and Stochastic. However, we haven’t covered much about the ADX indicator and its application. Today’s strategy is based on the ADX, which will help us in measuring the strength of a trend on any given time frame. The Average Directional Index (ADX) is a tool that is designed to measure the strength of a trend. When ADX is used in combination with other trading strategies, we get a complete understanding of the market trend and its efficacy.

Learning how to use the ADX is very easy. It ranges from a scale 0-100, 100 indicating a strong trend and 0 indicating a non-existent trend. If the ADX is close to 0, we can expect a sideways action in the market, meaning the market will neither go up or down but stay around the same value for some time. Remember, ADX will tell us about the strength of the trend. It does not guide us in the future direction of the market. For that reason, it is necessary to use concepts of market trend, retracement, and other technical indicators. ADX values of 50 and above are considered high, while ADX values of 20 and below are considered low. Weak trends are indicated by values of 20 and below.

Time Frame

The strategy works well on most time frames, including 15 minutes, 1 hour, 4 hours and Daily. However, we do not recommend applying the strategy on very low time frames due to market noise and liquidity issues.

Indicators

We use the Average Directional Index (ADX) and Simple Moving Average (SMA) indicators in the strategy.

Currency Pairs

The strategy is applicable on most currency pairs listed on the broker’s platform. However, it is advised to apply the strategy on major currency pairs only.

Strategy Concept

The ADX indicator ensures that we only trade when there is a strong trend in the market, regardless of the time frame. Here, even before looking at the candlesticks, we wait for the ADX indicator to show a reading above 60. A reading above 60 signals a strong trend and the likelihood of a trend continuation. We all know that the trend is our friend, but without gauging the strength of the trend, it can be dangerous to be a part of that trend. This is why we use the ADX indicator for trend trading.

The ADX is only limited to understanding the strength of the trend. However, in order to trade a ‘trend’, we also need to look at price action and trend continuation pattern in the market. Therefore, we use the concept of retracement and moving average to time our ‘entries.’ As this a trend trading strategy, we cannot use the rules for catching a reversal in the market.

We determine the take-profit and stop-loss levels based on ‘highs’ and ‘lows’ of the trend and retracement. Let us, straight dive, into the rules of the strategy.

Trade Setup

In order to explain the strategy, we will be executing a ‘long’ trade in USD/CAD currency pair using the rules of the strategy. Here are the steps to execute the strategy.

Step 1: Firstly, we have to plot the ADX and moving average indicators on the chart with their default setting. Before we actually look at the price action of the market, we have to watch the ADX indicator and its indication. Once the ADX crosses above 60, we look at the trend market and wait for an appropriate retracement.

Step 2: After gauging the strength of the trend using the ADX indicator, we need to wait for a suitable price retracement. The retracement, in other words, indicates a halt of the major trend of the market. In an uptrend, if price falls below the moving average and stays there, we say that the market has entered into retracement mode.

In a downtrend, if price rises above the moving average and stays there, we say that the market has entered into retracement mode. At this point, we are not sure if this is a retracement of the trend or is a start of the reversal. In order to confirm that it is a retracement, we again use the ADX indicator and check its reading. An ADX reading below 20 indicates that the ‘halt’ is actually a retracement of the major trend and not reversal.

Step 3: Now that we have got a confirmation from the ADX indicator that the market has gone into retracement mode, we should know how to enter the market. We go ‘long’ in the market when price crosses above the moving average and stays there for at least 4 or 5 candles. Similarly, we go ‘short’ in the market when price crosses below the moving average and stays there for at least 4 or 5 candles. As we just saw, the rule for entering a trade in this strategy is pretty simple and not complex at all.

Step 4: The last step of the strategy is to determine stop-loss and take-profit levels for the trade. We set take-profit near the ‘higher high’ of the uptrend while ‘long’ in the market and near the last ‘lower low’ of the downtrend while ‘short’ in the market. Stop-loss is placed below the previous ‘low’ of the retracement in an uptrend and above the ‘high’ of the retracement in a downtrend.

Strategy Roundup

The new ADX strategy gives very useful information which most of the times we never pay attention to. There are not many indicators which truly tell about the strength of the trend. ADX is one such indicator which tells if the trend is moving in strong fashion or not. At the same time, it is important to consider the strength of the pullback using price action and ADX indicator. Best profits come from catching strong trends, and this strategy helps us in accomplishing that.

Categories
Forex Signals

Choppy Session in USD/CAD Continues – Traders Braces for a Breakout Setup!

During Wednesday’s early Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around the 1.3030 level, mainly due to the broad-based U.S. dollar weakness. The prevalent downtrend in the U.S. dollar was mainly tied to the confidence over a potential vaccine for the extremely contagious coronavirus disease, which struggling to keep market trading sentiment positive. Moreover, President-elect Joe Biden faces difficulties from Donald Trump, which also weighs on the already weaker U.S. dollar. The reason for the declines in the currency pair could also be attributed to the fresh upward movement in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were being supported by fresh released upbeat American Petroleum Institute (API) data. As of writing, the USD/CAD currency pair is currently trading at 1.3028 and consolidating in the range between 1.3024 – 1.3037.

As we already mentioned, the market trading sentiment represented negative performance on the day as the sluggish appearance of Asia-Pacific stocks and declines of the U.S. 10-year Treasury yields tend to highlight the risk-off mood. However, the reason behind the risk-off market bias could be attributed to a combination of factors. Be it the worrisome headlines concerning the Sino-US tussle or the resurgence of the coronavirus. The market trading sentiment has been flashing red since the day started, which ultimately keeps the safe-haven assets supportive on the day. 

At the US-China front, the tensions between the United States and China still do not show any sign of slowing down as the U.S. imposed fresh sanctions on 4-Chinese diplomats over the Hong Kong Security Bill crackdown initially overshadowed the optimism over a potential vaccine and weighed on the market sentiment. Elsewhere, the declines in the equity market were further bolstered after U.S. President Donald Trump’s push to block election results to confuse optimists. 

Despite the risk-off mood, the broad-based U.S. dollar remained depressed. The investors continue to sell U.S. dollars on the back of optimism over a potential vaccine for the highly contagious coronavirus disease. Moreover, the losses in the U.S. dollar could also be associated with political uncertainty in the U.S. Thus, the losses in the U.S. dollar kept the currency pair lower. Meantime, the U.S. Dollar Index, which tracks the greenback against a bucket of other currencies, was down at 92.707.

At the crude oil front, WTI crude oil prices remained well bid around above $41 on the day, backed by the COVID vaccine hopes and the victory of Joe Biden, which boosted the market trading sentiment and demand sentiment the crude oil. Apart from this, China has played a significant role in underpinning global oil demand recovery. They showed that the inventories had declined considerably in recent weeks, indicating the domestic economic recovery. Moreover, the crude oil prices upticks were further boosted after the American Petroleum Institute (API) reported the major draw in crude oil inventories of 5.147 million barrels for the week ending November 6. Thus, the crude oil prices’ upticks underpinned the commodity-linked currency the Loonie and exerted some downside pressure on the currency pair. 


Daily Support and Resistance

S1 1.289

S2 1.2957

S3 1.2995

Pivot Point 1.3023

R1 1.3061

R2 1.3089

R3 1.3156

The USD/CAD pair is consolidating around the 1.3020 area, testing the resistance level of the 1.3033 mark. On the higher side, the bullish breakout of the 1.3033 level can stretch the buying trend until the next resistance level of 1.3098. While on the lower side, the immediate support stays at 1.3000, and below this, the next support is likely to be found around 1.2935 level. Overall, the USD/CAD isn’t moving a lot as traders are enjoying bank holidays in Canada and the U.S. amid Remembrance and Veterans Day. We may have a thin trading volume and volatility in the market today. Good luck!

Categories
Forex Signals

USD/CAD Downward Channel Continues to Play – Brace for Selling!

The USD/CAD pair was closed at 1.30072 after placing a high of 1.30519 and a low of 1.29281. The USD/CAD pair slipped to its lowest since mid-October 2018 on Monday as the risk appetite increased and weighed on the safe-haven US dollar that ultimately dragged the USD/CAD pair lower.
On Monday, the primary driver of the USD/CAD was the WTI Crude Oil prices that rose to $41.32 per barrel on the day after the optimism regarding the vaccine development raised in the market. The hopes for economic recovery were also raised as the vaccine news increased the chances of removing lockdowns and restrictions from the countries across the globe.

On Monday, Pfizer in collaboration with the BioNtech, announced together that their vaccine had proven 90% efficient in preventing the infection of coronavirus in its last stage clinical trials. They said that they would seek approval for their vaccine’s emergency use from the US later this month.

This news raised the risk sentiment and decreased the need for lockdowns weighing on the oil prices due to decreased demand during lockdowns. The crude oil prices surged and placed high gains on Monday that gave strength to commodity-linked Loonie that ultimately weighed heavily on the USD/CAD pair.

However, most of its daily losses were recovered after the US dollar rebounded on the hopes of no need for further stimulus measures as the vaccine had been developed. The US dollar strength drove the USD/CAD pair higher and recovered most of its daily losses. There were no macroeconomic releases from both sides s the pair continued following Pfizer and BioNtech’s latest announcement regarding vaccine development.


Daily technical Levels
Support Resistance
1.2932 1.3076
1.2857 1.3145
1.2788 1.3220
Pivot point: 1.3001

The USD/CAD pair is consolidating with a selling bias beneath the 1.3007 zones, disrupting the support region of the 1.3025 mark. On the downside, the bearish breakout of the 1.3025 level can extend selling bias until the 1.29720 level. Continuation of a selling bias can help us capture a quick sell trade until the 1.2972 area. So far, the MACD and EMA are neutral as the market lacks volatility. But we can expect some price action during the European session. Let’s brace for it. Good luck!

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Forex Signals

USD/CAD Breaking Underneath Double Bottom Support – Brace for Sell! 

The USD/CAD pair was closed at 1.30589 after placing a high of 1.30967 and a low of 1.30192. The USD/CAD fell to its lowest since 1st September on Friday before rising and posting gains for the day.

After posting sharp losses for the previous four days, the USD/CAD pair reversed and posted gains on Friday despite the broad-based US dollar weakness. The main driver of the USD/CAD pair on Friday was the Crude oil prices.

The WTI Crude Oil prices declined to $37.06 per barrel on Friday amid the rising number of lockdown restrictions from the European nations and other countries. The resurgence of the second wave of coronavirus forced governments to re-impose restrictions, raising concerns for oil prices.

As the previous lockdowns decreased the crude oil prices to its lowest level in history, the same fears emerged in the market after the second wave of virus escalated. These lingering fears kept the crude oil prices under pressure and weighed on commodity-linked Loonie that ultimately pushed the USD/CAD pair on the higher side.

On the data front, at 18:30 GMT, the Employment Change from Canada for October rose to 83.6K against the forecasted 59.0K and supported the Canadian dollar and capped further upside of the USD/CAD pair. The Unemployment Rate from Canada for October also declined to 8.9% from the forecasted 9.0% and supported the Canadian dollar. At 20:00 GMT, the Ivey PM for October from Canada declined to 54.2 against the projected 55.2 and weighed on the Canadian dollar and supported the USD/CAD pair’s gains on Friday.

From the US side, at 18:30 GMT, Average Hourly Earnings from the US for October fell to 0.1% from the predicted 0.2% and weighed on the US dollar and capped further gains in the USD/CAD pair. For October, the Non-Farm Employment Change rose to 638K against the predicted 595K and supported the US dollar and pushed the pair USD/CAD further on the upside. The Unemployment Rate from the US in October dropped to 6.9%from the predicted 7.7% and supported the US dollar. At 20:00 GMT, the Final Wholesale Inventories for September came in as 0.4% against the expected -0.1% and weighed on the US dollar.

Meanwhile, the US dollar was weak across the board due to the chances of Joe Biden’s victory in US elections on Friday as he was expected to deliver a larger stimulus package. However, the US dollar weakness only affected the pair in an early trading hour at the ending day of the week and failed to impact the USD/CAD pair’s prices in a late trading hour due to declining crude oil prices.


Daily Technical Levels

Support Resistance

1.2989 1.3142

1.2931 1.3237

1.2836 1.3295

Pivot point: 1.3084

The USD/CAD pair is trading with a selling bias below the 1.3007 area, having violated the support area of the 1.3025 level. On the lower side, the bearish breakout of the 1.3025 level can extend selling bias until the 1.29720 level. Continuation of a selling bias can help us capture a quick sell trade until the 1.2972 area. So far, the MACD and EMA are neutral as the market lacks volatility. But we can expect some price action during the European session. Let’s brace for it. Good luck! 

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Forex Signals

USD/CAD Bearish Price Action Continues – Downward Channel In Play! 

The USD/CAD pair was closed at 1.30425 after placing a high of 1.31781 and a low of 1.30280. The USD/CAD pair dropped to its lowest since 1st September on the back of U.S. dollar weakness triggered by the expectations of Biden victory in the U.S. presidential elections.

The pair USD/CAD failed to capitalize its early daily gains and fell to its two months lowest level as the selling bias surrounding the U.S. dollar intensified. The greenback was weak due to the U.S. residential Election’s delayed outcome, where Democrat candidate Joe Biden was leading over the incumbent Donald Trump.

However, the final results are yet to announce as Donald Trump has already filed lawsuits against the counting of votes in key battleground states that added to the uncertainty and dampened prospects for a big stimulus package to aid the COVID-19 hit economy. It added further losses in the U.S. Treasury bond yields and contributed to the losses of the USD/JPY pair. Meanwhile, the USD/JPY pair’s downward momentum was cushioned on the back of fresh losses in crude oil prices that tend to undermine the commodity-linked Loonie. The weak Loonie then capped further losses in the USD/CAD pair on Thursday.

The crude oil prices are expected to decrease further in the coming days as the concerns about the renewed lockdown measures to curb the second wave of coronavirus infections were increasing.

On the data front, at 17: 30 GMT, the Challenger Job Cuts for the year came in as 60.4% in comparison to the previous 185.9% from the U.S. At 18:30 GMT, the Unemployment Claims for the last week surged to 751K against the projected 740K and weighed on the U.S. dollar, and added USD/CAD pair losses. The Prelim Nonfarm Productivity for the quarter surged to 4.9% against the projected 3.6% and weighed on the U.S. dollar.

At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in as -8.9% against the estimated -10.0% and supported the U.S. dollar.

Furthermore, the U.S. dollar was also weak across the board after releasing the Federal Reserve’s latest announcement to keep the interest rates and assets purchases on the same level. This selling bias in the U.S. dollar added further losses in the USD/CAD pair on Thursday.


Daily Technical Levels

Support Resistance

1.2989 1.3142

1.2931 1.3237

1.2836 1.3295

Pivot point: 1.3084

The USD/CAD is trading with a selling bias at the 1.3061 level, having an immediate resistance at 1.3097 along with support at the 1.3030 level. Violation of 1.3030 level can extend selling until 1.2970 level. The downward channel is also putting pressure on the downward trend; therefore, we should look for selling trades below the 1.3090 level today. Good luck! 

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Forex Signals

USD/CAD Testing Triple Bottom – Is It Good time to go Long? 

The USD/CAD pair was closed at 1.31332 after placing a high of 1.32991 and a low of 1.30953. The USD/CAD pair rose to a daily high of 1.3300 during the Asian session on Wednesday but reversed in the late session and converted gains into modest losses.

The US election results were expected to end with a blue wave and were weighing on the US dollar in previous days, but on Wednesday, the tables turned after the results were tightened. The hopes faded away that democrats will be controlling the Senate, and the expectations of divided government increased that started supporting the US dollar.

The strong US dollar pushed the USD/CAD pair higher; however, the market sentiment reversed after the specter of recounts, appeals to the Supreme Court, and lawsuits emerged and delayed the election results. These uncertainties weighed on market sentiment, and the pair USD/CAD reversed its direction and turned its gains into losses.

On the data front, at 18:30 GMT, the Trade Balance for September dropped to -3.3B against the expected -2.2B and weighed on the Canadian Dollar and supported the upward trend in the earlier session.

From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for October fell to 365K against the anticipated 650K and weighed on the US dollar and added in USD/CAD losses pair. 

At 18:30 GMT, the Trade Balance from the US for October remained flat at -63.9B. At 19:45 GMT, the Final Services PMI for October rose to 56.9 from the estimated 56.0 and supported the US dollar. At 20:00 GMT, the ISM Services PMI for October plunged to 56.6 from the projected 57.4 and weighed on the US dollar and supported the USD/CAD pair’s bearish trend.

On WTI crude oil front, the prices rose above $39 per barrel on Wednesday and gave strength to the commodity-linked Loonie that ultimately added pressure on the USD/CAD pair and declined its prices.


Daily Technical Levels

Support Resistance

1.3075 1.3209

1.3020 1.3290

1.2940 1.3344

Pivot point: 1.3155

The USD/CAD pair is trading with a neutral bias at the 1.3102 level, holding right below an immediate support area of 1.3100 level. It’s a triple bottom level. Therefore we can expect the Loonie pair to bounce off over this level to target the 1.3219 area. On the higher side, the USD/CAD may find support at the 1.3377 level. Let’s wait for a signal to enter a trade! 

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Forex Signals

USD/CAD Extended Overnight Gains & Hit the Intra-Day – Elections In Play! 

Today in the Asian trading session, the USD/CAD currency pair managed to stop its three-day downtrend and witnessed some heavy buying around above mid-1.3200 level, mainly due to the broad-based U.S. dollar strength. However, the bullish sentiment around the U.S. dollar was being supported by President Donald Trump’s victory in Florida, which pushed the currency pair intraday high. 

On the contrary, the upticks in the oil prices, backed by the bigger-than-expected draw in the U.S. crude stockpiles, became the key factor that kept the lid on any additional crude gains oil prices. Moreover, the bullish sentiment around the crude oil prices was also supported by the reports suggesting that OPEC and its allies (OPEC+) maintaining current production restrictions, which tend to ease oversupply fears and contribute to oil prices. Currently, the USD/CAD currency pair is currently trading at 1.3234 and consolidating in the range between 1.3093 – 1.3278.

As we all know, the market risk sentiment has been flashing mixed signals since the day started amid U.S. election polls. However, the expectations of a blue wave in the U.S. Congress weakened quickly after President Donald Trump won Florida’s key battleground state. Conversely, the Arizona governor said that it was too early to call the state for Biden. As per Fox News, the tally on the electoral College now stands at 233 for both Joe Biden and Donald Trump, indicating that the race is tighter than expected.

At the USD front, the broad-based U.S. dollar managed to keep its gains throughout the day as the traders still cheering President Donald Trump’s victory in Florida. Put, the bid tone around the safe-haven greenback seems to have increased in response to betting markets having President Trump as the favorite to win elections. However, the U.S. dollar gains seem rather unaffected by the risk-on market sentiment. Thus, the gains in the U.S. dollar become the key factor that kept the currency pair higher. Meantime, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies rose to 93.898.

 At the crude oil front, the crude oil prices succeeded in gaining positive traction and surged to the $38.80 mark after a surprise draw of -8.01M, against 4.55M prior, in private inventory data published by the American Petroleum Institute (API) on Tuesday. This, in turn, boosted crude oil prices by over 3% overnight. Furthermore, the sentiment around crude oil was improved further after the reports concluded that the Organization of the Petroleum Exporting Countries (OPEC) and its allies maintained current production restrictions, which tend to ease oversupply fears and contribute to the oil prices. Thus, the rise in oil prices underpinned demand for the commodity-linked currency the loonie and became the major factor that capped the pair’s further gains.

In the absence of significant data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. elections and updates about the U.S. stimulus package. 


Daily Support and Resistance

S1 1.2899

S2 1.3029

S3 1.3083

Pivot Point 1.3158

R1 1.3213

R2 1.3288

R3 1.3418

The USD/CAD is trading with a bullish bias at the 1.3278 level, having violated the immediate resistance level of 1.3223. it’s the same level extended by an upward channel, which got violated a couple of days ago. On the higher side, we can expect the USD/CAD pair to continue trading bullish until the 1.3323 level, as the MACD is also in support of the buying trend. The recent bullish engulfing is in support of buying; however, the election results may drive some volatility in the market. Let’s wait for a trading signal! 

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Forex Signals

USD/CAD Heading for Triple Bottom Support – Brace for the Buying Signal!  

The USD/CAD pair was closed at 1.32158 after placing a high of 1.33702 and a low of 1.32153. The USD/CAD pair dropped on Monday after posting gains for three consecutive sessions. Despite the broad-based U.S. dollar strength, the USD/CAD pair fell on Monday and posted sharp losses on the back of the strength of the Canadian Dollar and rising crude oil prices.

The Loonie has been unaffected by the broad-based U.S. dollar strength on Monday as the WTI crude oil prices rebounded by 2% on the day and provided strength to the commodity-linked Loonie.

Furthermore, the risk sentiment was also improved in the market as the main equity indexes advanced on Monday, and oil prices also rose by $2 per barrel. The Chinese factory data also showed advancement along with the improved U.S. manufacturing activity offset the concerns about the coronavirus spread and supported the Canadian Dollar against the U.S. dollar and dragged the pair USD/CAD on the lower side.

On the data front, at 19:30 GMT, the Manufacturing PMI from Canada for October was declined to 55.5 from the previous month’s 56.0 and weighed on the Canadian Dollar that capped further losses in the USD/CAD pair.

Whereas, from the U.S. side, at 19:45 GMT, the Final Manufacturing PMI for October came in line with the projections of 53.4. At 20:00 GMT, the ISM Manufacturing PMI for October rose to 59.3 from the anticipated 55.6 and supported the U.S. dollar. The Construction Spending for September dropped to 0.3% from the estimated 1.0% and weighed on the U.S. dollar. The ISM Manufacturing Prices for October also surged to 65.6 against the anticipated 60.5 and supported the U.S. dollar. The positive U.S. macroeconomic data on Monday limited the additional losses in the USD/CAD pair.

The U.S. dollar came under fresh pressure ahead of the upcoming U.S. election as both candidates Joe Biden and Donald Trump have said that they would introduce the next round of U.S. stimulus after the elections. The fact that stimulus measures will be delivered regardless of who will win the election weighed on the U.S. dollar and added further losses in the USD/CAD pair on Monday.


Daily Technical Levels

Support Resistance

1.3334 1.3388

1.3297 1.3407

1.3279 1.3443

Pivot point: 1.3352

Technically, the USD/CAD fell sharply amid weakness in the U.S. dollar ahead of the U.S. elections. On the lower side, the USD/CAD is facing support at 1.3103 level, and closing of a candle over 1.3103 level can drive bullish movement in the USD/CAD pair. The MACD has entered the oversold zone; therefore, we may have an opportunity to go long over 1.3103 level today.

Entry Price – Buy Limit 1.3086

Stop Loss – 1.3046

Take Profit – 1.3126

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Upward Channel to Support the pair – Brace for Buy Trade! 

The USD/CAD pair was closed at 1.33219 after placing a high of 1.33483 and a low of 1.32795. On Friday, the currency pair USD/CAD remained confined in a consolidated range throughout the day. The USD/CAD pair dropped in an earlier trading session on Friday amid the strong Canadian GDP and other economic data. However, the pair started falling in late session due to the declining crude oil prices on the day. Meanwhile, the US dollar was strong over the board ahead of the US Presidential elections and the strong macroeconomic data on the day.

On the data front, at 17:30 GMT, the Gross Domestic Product for August raised to 1.2% from the forecasted 0.9% and supported the Canadian dollar. The IPPI for September declined to -0.1% from the anticipated 0.1% and weighed on the Canadian dollar. The RMPI for September dropped to -2.2% from the forecasted 0.3% and weighed on the Canadian dollar.

The rise in Canadian dollar demand after the release of GDP started to lose its momentum on Friday after the investors realized that the economic growth in Canada would not persist for long as the coronavirus cases were spreading and hitting the economic growth recovery.

From the US side, at 17:30 GMT, the Core PCE Price Index for September came in line with the expectations of 0.2% from the US. Personal Spending from the US surged to 1.4% from the estimated 1.0% and supported the US dollar. The Employment Cost Index for the quarter remained the same at 0.5%. The Personal Income for September rose to 0.9% from the projected 0.3% and supported the US dollar. 

At 18:45 GMT, the Chicago PMI for October surged to 61.1 against the expected 58.2 and supported the US dollar. At 19:00 GMT, the Revised UoM Consumer Sentiment for October also advanced to 81.8 against the forecasted 81.2 and supported the US dollar. The Revised UoM Inflation Expectations for October came as 2.6% in comparison to September’s 2.7%.

Most of the macroeconomic figures from the US came in favor of the local currency that added strength in the USD/CAD pair on the day.

Furthermore, the gains were extended in the late session as the crude oil prices declined on Friday and remained low till $41.0 per day. The declining crude oil prices weighed on commodity-linked Loonie and forced the US dollar to move higher and push the USD/CAD pair. Another factor involved in the upward trend of the USD/CAD pair was the latest decision by the Federal Reserve on Friday to decrease the minimum limit of short-term and medium-term loans to $100,000 from the previous $250,000 to support the small & medium-sized businesses.


Daily Technical Levels

Support Resistance

1.3269 1.3385

1.3214 1.3446

1.3153 1.3501

Pivot point: 1.3330

The USD/CAD is trading with a selling bias falling from 1.3338 level to 1.3242 level, and it’s pretty much likely to drop further until the next support area of 1.3200 level. It’s the level that’s been extended by an upward trendline. The MACD histograms have also started forming below 0 supporting selling bias in the market. I will be looking to take a buy trade at this level of 1.3200 with a stop loss below the 1.3165 area and take profit level of 1.3340 mark. Good luck! 

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Forex Signals

USD/CAD Choppy Session Continues – Brace for Breakout Signal! 

The USD/CAD pair was closed at 1.33195 after placing a high of 1.33896 and a low of 1.32777. On Thursday, the USD/CAD pair moved higher in the early trading session due to the rising demand for the U.S. dollar and declining crude oil prices on the day. However, the gains in USD/CAD failed to remain until the end of the day, and the pair lost all of its gains at the late trading session on Thursday and provided a flat movement for the session.

The USD/CAD pair closed its day at the same level it started its day with at 1.33195 on Thursday. The rise in the USD/CAD pair was due to the strength of the U.S. dollar onboard. The U.S. Dollar Index rose to 94 levels on Thursday to its highest level in a month and supported the upward momentum of the USD/CAD pair. The U.S. dollar was also strong as the House Speaker Nancy Pelosi killed the hopes that a U.S. stimulus package will be delivered after the U.S. elections. These uncertainties raised the risk sentiment and helped the risk perceived USD/CAD pair to rise on Thursday.

Furthermore, the heavy selling pressure surrounding the WTI crude oil prices provided a boost to USD/CAD prices in the early trading session. The concerns over the negative impact of the rising number of coronavirus cases globally have been causing an uneven recovery in energy demand. The increasing number of countries imposing restrictions raised concerns for energy demand and the WTI Crude oil prices suffered on Thursday and fell below the $35 level to $34.92 per barrel. The sharp decline in WTI crude oil prices weighed on commodity-linked Loonie and supported the upward momentum of the USD/CAD pair.

On the data front, from the U.S. side, at 17:30 GMT, the Advanced GDP for the quarter rose to 33.1% from the expected 32.0% and supported the U.S. dollar. The Unemployment Claims for the previous week declined to 751K from the estimated 773K and supported the U.S. dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter rose to 3.6% from the projected 2.9% and supported the U.S. dollar. At 19:00 GMT, the Pending Home Sales for September fell to -2.2% from the anticipated 3.1% and weighed on the U.S. dollar.

The strong GDP and unemployment claim data from the US-supported US dollar and added strength to the USD/CAD pair on Thursday. While from the Canadian side, the Building Permits for September came in as 17.0% against August’s 1.4% and supported the Canadian dollar that kept the gains in the USD/CAD pair limited. The pair USD/CAD started losing all of its daily gains in late trading session as profit-taking started in the market. The USD/CAD pair rose to its one-month highest level but failed to remain there and dropped to give flat movement for Thursday.


Daily Technical levels

Support Resistance

1.3219 1.3377

1.3119 1.3435

1.3061 1.3535

Pivot point: 1.3277

The USD/CAD pair is trading choppy session within 1.3339 – 1.3300 as traders seem to wait for a solid reason to trigger a breakout. In any case, a bearish breakout of 1.3300 level can extend selling bias until 1.3240 level, and below this, the double bottom level is likely to provide next support at 1.3112. Conversely, the bullish breakout of 1.3340 level is likely to target the 1.3420 mark. The MACD and RSI are in support of bullish bias; however, the signal isn’t that strong yet. Let’s brace to trade the breakout pattern today. Good luck! 

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Forex Signals

USD/CAD Extended Overnight Gaining Streak – Is It Time to go Short?

Today in the early Asian trading session, the USD/CAD currency pair extended its previous session bullish bias and hit the session high around above 1.3300 level. However, the bullish sentiment around the currency pair was being supported by a pickup in the U.S. dollar demand and the ongoing drop in crude oil prices, which tend to undermine demand for the commodity-linked currency – the loonie. Hence, the broad-based U.S. dollar succeeded in gaining some positive traction on the day amid growing market worries about surging coronavirus cases in Europe and the United States, which keeps the market trading sentiment under pressure and undermined the safe-haven U.S. dollar. In addition to this, the long-lasting impasse over the next round of the U.S. fiscal stimulus measures added further burden on investors’ sentiment and benefitted the USD’s status as the global reserve currency. Across the pond, the reason for the currency pair bullish bias could also be attributed to the weaker crude oil prices, which undermined the demand for the commodity-linked currency the loonie and contributed to the currency pair gains. As of writing, the USD/CAD currency pair is currently trading at 1.3320 and consolidating in the range between 1.3319 – 1.3326.

As we all know that the market trading sentiment remains depressed during the Asian trading session as the concern about the second wave of coronavirus infections, the lockdown measures to control the outbreak in several countries, which kept the global risk sentiment under pressure. Thus, the ever-increasing cases of coronavirus across the globe, destroying hopes of any V-shaped economic recovery. This, in turn, urged investors to invest their money into safe-haven assets.

Additionally, the lack of clarity over the much-awaited coronavirus (COVID-19) stimulus bill also keeps the investors cautious. In the meantime, the U.S. political uncertainty also exerted downside pressure on the market trading sentiment. Besides, the long-lasting tussle between the world’s two largest economies also played its major role in undermining the market trading sentiment. This, in turn, boosted the U.S. dollar and was seen as a key factor that kept the currency pair higher.

This, in turn, the broad-based U.S. dollar succeeded in extending its early-day gains and remained well bid on the day as investors turned to the safe-haven in the wake of risk-off market sentiment. However, the greenback gains could be temporary due to the worries that the economic recovery in the U.S. could be stopped because of the reappearance of coronavirus cases. Besides this, the U.S. dollar gains were further boosted by a lack of progress toward a U.S. stimulus package, which puts traders in a cautious mood. However, the gains in the U.S. dollar kept the currency pair higher. The dollar index, which pits the dollar against a bucket of 6-major currencies, stood at 93.472.

Across the pond, the crude oil prices failed to stop its previous-day losing streak and witnessed some dramatic declines around below the $37.00 mark. However, the reason for the bearish bias around the crude oil prices could be attributed to the ever-increasing COVID-19 worries, which raised fears of renewed lockdown measures and depressed hopes for a swift recovery in the fuel demand. Across the pond, the declines in the crude oil prices were further bolstered after the surprisingly large U.S. crude stockpile build for last week reported by the government, which ultimately strengthened fears about depleting demand for fuel amid the worsening global coronavirus pandemic. Thus, the declines in crude oil prices undermined demand for the commodity-linked currency the loonie and contributed to the currency pair gains. 

Looking forward, the market traders will keep their eyes on the USD moves amid the lack of major data/events on the day. Furthermore, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for the fresh direction.


Daily Support and Resistance

S1 1.3066

S2 1.312

S3 1.3153

Pivot Point 1.3175

R1 1.3208

R2 1.323

R3 1.3285

Entry Price – Sell 1.32895

Stop Loss – 1.33295

Take Profit – 1.32395

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Continues Trading Bullish – Upward Channel In Play! 

The USD/CAD pair was closed at 1.31832 after placing a high of 1.32119 and a low of 1.31420. The USD/CAD pair reversed its previous day move and fell on Tuesday to post losses. The USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices. However, the USD/CAD pair’s losses were recovered in the late American session after the release of American macroeconomic data and ahead of the Bank of Canada’s interest rate decision.

The USD/CAD pair failed to capitalize on the previous session’s strong positive move of around 100 pipis and started moving in the downward direction as the US dollar was weak across the board. The US Dollar Index fell to 92.8 level by 0.3% on Tuesday and weighed on the greenback that ultimately exerted pressure on the USD/CAD pair.

The US dollar was also weak because of the US political environment where chances of a blue wave in the upcoming US Presidential elections that will be held on November 3rd, were increasing as the national polls suggested.

Meanwhile, the US also reported 74,300 new coronavirus cases in a single day that also raised bars for fresh lockdowns. These depressing situations kept weighing on the US dollar that was already under pressure due to the stalled talks over the next round of the US stimulus package. As the coronavirus cases were increasing day by day and the governments were forced to impose restrictions again, economic recovery concerns raised even more as the government funding had dried up, and the talks for further measures have stalled till elections. These concerns kept the market sentiment under pressure, and the USD/CAD pair suffered due to it.

However, on the data front, at 18:00 GMT, the Housing Price Index for August from the US was raised to 1.5% from the expected 0.7% and supported the US dollar. The S&P/CS Composite-20 HPI for the year also advanced to 5.2% from the projected 4.2% and supported the US dollar. At 18:59 GMT, the Richmond Manufacturing Index for October surged to 29 against the expected 18 and supported the US dollar that recovered its earlier losses in the USD/CAD pair.

However, at 19:00 GMT, the CB Consumer Confidence for October was dropped to 100.9 from the projected 102.1 and weighed on the US dollar that added further pressure on the USD/CAD pair. The USD/CAD pair reversed its movement after the US economic data release amid the US dollar started to pick its demand as durable goods orders had recovered to their pre-pandemic levels, which was an encouraging sign.

Meanwhile, the WTI crude oil prices raised above the $39 level on Tuesday and gave strength to commodity-linked Loonie that ultimately added pressure on the USD/CAD prices and added further in the losses of pair on the day. Investors will keep a close eye on the Bank of Canada on Wednesday when the central bank will hold its monetary policy meeting. The interest rates are currently at the 0.25% level slashed in March and have not been changed until then. The rate statement could impact USD/CAD prices tomorrow as investors will be interested in the view of BoC related to the health of the economy. 


Entry Price – Buy 1.31941

Stop Loss – 1.31541

Take Profit – 1.32441

Risk to Reward – 1:1.25

Profit & Loss Per Standard Lot = -$400/ +$500

Profit & Loss Per Micro Lot = -$40/ +$50

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Bullish Channel Breakout – Potential Buying Trade! 

The USD/CAD pair was closed at 1.31379 after placing a high of 1.31771 and a low of 131235. The USD/CAD pair remained flat throughout the day as it ended its day at the same level it started its day at 1.31378.

The on-again-off-again talks for the US stimulus package between Republicans and Democrats confused the traders and caused a flat movement in the USD/CAD pair on Thursday. The House of Representative Speaker Nancy Pelosi and the US Treasury Secretary Steven Mnuchin held talks on Thursday, but the prospect of a deal before elections were dimmed.

If a deal was reached tomorrow, the stimulus package will still not be implemented until after the election. For US President Trump who has pushed for a larger stimulus, it will be good news, but for Republicans senators who have their election campaigns to worry about, it will be bad news. A massive stimulus spending package before elections will not win many votes among conservative voters. Given this situation, the hopes for a stimulus measure package before elections faded away and raised bars for the US dollar that pushed the pair USD/CAD on the upside.

On the data front, the macroeconomic releases from the US on Thursday were also in favor of the US dollar. At 17:30 GMT, the Unemployment Claims from the US reduced to 787K from the anticipated 860K and supported the US dollar. While at 19:00 GMT, the CB Leading Index dropped to 0.7% from 0.8%of expectations and weighed on the US dollar. The Existing Home Sales from the US also raised to 6.45M from the expected 6.20M and supported the US dollar.

The US dollar was even stronger from the macroeconomic data release and pushed the USD/CAD pair even higher to 1.31771 level on Thursday. Whereas, the USD/CAD pair failed to remain on the bullish side as the crude oil prices rose on Thursday.

The rise in WTI crude oil prices above the $41 level gave strength to commodity-linked Loonie that ultimately weighed on USD/CAD pair, and the pair started to lose its early daily gains and ended its day on the same level it started its day with and the pair gave flat movement for the day.


Daily Technical Levels

Support Resistance

1.3110 1.3167

1.3087 1.3201

1.3052 1.3224

Pivot point: 1.3144

The USD/CAD is trading with a bullish bias, especially after violating the upward channel that was enlarging resistance at 1.3203 level. On the lower side, the USD/CAD may find next support at 1.3203 area, and violation of this mark can drive the Loonie price towards the next support mark of 1.3172. The MACD is in a buying zone; therefore, we should look for a buying trade over 1.3203 level. Good luck!

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Forex Signals

USD/CAD Slips Below Downward Trendline – Brace for a Sell Signal! 

The USD/CAD pair was closed at 1.31447 after placing a high of 1.31519 and a low of 1.30808. Overall the movement of the USD/CAD pair remained bullish throughout the day. In the early trading session on Wednesday, the USD/CAD pair followed its Tuesday’s move and dropped to its lowest since 7th September over the US dollar’s weakness. The decline in crude oil prices also played a role in raising the USD/CAD pair on board. The negative macroeconomic data from Canada also added strength to the USD/CAD pair gains on Wednesday.

On the data front, the Consumer Price Index from Canada was released at 17:30 GMT for September, which came in line with -0.1%. The Core Retail Sales from Canada for September declined to 0.5% from the projected 0.9%. For September, the Retail Sales dropped to 0.4% against the expected 1.0% and weighed on the Canadian dollar. Dollarmmon and Median CPI from Canada came in line with the expectations of 1.5% and 1.9%, respectively.

 Whereas the NHPI for September raised to 1.9% from the forecasted 1.2%. The Core CPI for September also remained the same as the year at 0.1%. However, the Trimmed CPI for the year raised to 1.8% against the forecasted 1.7%. The highlighted CPI, Retail Sales, and Core Retails Sales data came in negative or as expected and weighed on the Canadian Dollar tDollartimately pushed higher the USD/CAD prices on Wednesday.

Meanwhile, the Crude Oil Inventories from the previous week dropped to -1.0M against the forecasted 0.5M and raised the demand for crude oil that ultimately supported the declining WTI crude oil prices on Wednesday.

Crude oil prices suffered on Wednesday though most of its losses recovered still, it closed its day weak, which made its commodity-linked currencies Loonie weaker and supported the rising USD/CAD pair.


Daily technical Levels

Support Resistance

1.3103 1.3184

1.3051 1.3213

1.3023 1.3265

Pivot point: 1.3132

The USD/CAD is facing immediate resistance at the 1.3171 level, and closing of candles below this level is likely to drive selling bias in the market. The USD/CAD has recently closed a Doji candle below 1.3172, which is suggesting that the bullish bias seems to be over, and sellers may enter the market soon. As we can see on the chart, the USD/CAD’s very next candle is bearish engulfing, followed by a doji candle, support strong selling bias for the pair. Therefore, we have opened a sell signal, and we aim for quick 40 pips. Check out a trading plan below.

Entry Price – Buy 0.71124

Stop Loss – 0.70724

Take Profit – 0.71524

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

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