- The USD/CAD couldn't hold onto highs above 1.3540, falling back to end Wednesday flat.
- The US Dollar is broadly higher across the markets, but the CAD is seeing additional support from bumping oil prices.
- US & CAD GDP to land on Friday.
The USD/CAD kicked Wednesday off with a jump to 1.3543 as the US Dollar (USD) caught a broad-market bid on risk aversion and bumper US data, but soaring crude oil prices are sending the Loonie (CAD) higher and the USD/CAD is set to head into Thursday's market session trading on the low end of the 1.3450 handle.
US data continues to beat expectations, with US Durable Goods Orders for August printing at 0.2% versus the forecast -0.5%. Up next for the US data docket will be Thursday's Gross Domestic Product (GDP). US GDP for the second quarter is seen holding steady at the previous print of 2.1%.
Friday will see Canadian GDP figures for July forecast to rebound from -0.2% to 0.1%, while the US side sees Personal Consumption Expenditure (PCE) Price Index numbers, which the median market forecasts are expecting to hold steady at 0.2% for the month of August.
The US Dollar eventually lost the tug-of-war with the oil-bolstered Loonie, even as hawkish Fed officials and an impending government shutdown prop up the US Dollar Index (DXY) to fresh highs.
Crude oil prices are leaping up the charts as supply constraints continue to squeeze barrel costs to 13-month highs, and the upside fossil pressure was enough to keep CAD on-balance to send the USD/CAD back to the 1.3500 handle.
Read more:
Fed’s Kashkari: I am open to the possibility that we may need more than one hike
Forex Today: Dollar is the only safe haven in town, Oil soars
USD/CAD technical outlook
The USD/CAD is getting pinned to the 34-day Exponential Moving Average (EMA) on daily candles, and the pair is at risk of falling back to the 200-day Simple Moving Average (SMA) just north of 1.3450.
The pair is still up 3% from the last swing low into the 1.3100 handle.
On the hourly candlesticks, a continued backslide will see the pair testing the 200-hour SMA near 1.3480, with technical support coming from a rising trendline from last week's swing lows near 1.3430 and 1.3450.
USD/CAD daily chart
USD/CAD technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD struggles to hold above 1.0400 as mood sours
EUR/USD stays on the back foot and trades slightly below 1.0400 following the earlier recovery attempt. In the absence of high-tier data releases, the negative shift seen in risk mood helps the US Dollar gather strength and forces the pair to stretch lower.
GBP/USD declines toward 1.2500 on renewed USD strength
GBP/USD loses its traction and declines to the 1.2500 area in the second half of the day on Monday. The US Dollar (USD) benefits from safe-haven flows and weighs on the pair as investors await US Consumer Confidence data for December.
Gold drops below $2,620 as US bond yields edge higher
After starting the week in a quiet manner, Gold comes under bearish pressure and retreats below $2,620. The benchmark 10-year US Treasury bond yield stays in positive territory above 4.5%, making it difficult for XAU/USD gain traction.
Bitcoin fails to recover as Metaplanet buys the dip
Bitcoin hovers around $95,000 on Monday after losing the progress made during Friday’s relief rally. The largest cryptocurrency hit a new all-time high at $108,353 on Tuesday but this was followed by a steep correction after the US Fed signaled fewer interest-rate cuts than previously anticipated for 2025.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.