USD/CAD Slips Below 1.3850 Ahead of U.S. Data, BoC
USD/CAD dips below 1.3850 ahead of key US data and BoC Governor Macklem’s speech
FUNDAMENTAL OVERVIEW:
The US Dollar reversed its earlier gains against the Canadian Dollar on Tuesday, slipping below 1.3850 after failing to extend beyond intraday highs near 1.3870. On the daily charts, the pair has turned negative ahead of key catalysts, including US Durable Goods Orders, Consumer Confidence data, and remarks from BoC Governor Tiff Macklem.
Earlier in the session, volatility picked up after former President Donald Trump intensified criticism of the Federal Reserve, demanding the resignation of Fed Governor Lisa Cook over alleged mortgage fraud. Cook swiftly dismissed the call, affirming that she would remain in her role, emphasizing that the president lacks the authority to remove her.
Attention now shifts to upcoming US economic data, which is expected to highlight further signs of slowdown. Durable Goods Orders are forecast to decline by 4% after a sharp 9.3% drop previously, while Consumer Confidence is projected to ease to 96.2 from July’s 97.2 reading.
Later in the day, BoC Governor Macklem is scheduled to speak at the Bank of Mexico’s 100th Anniversary Seminar, where markets will look for insights into the Canadian central bank’s potential policy direction.
USD/CAD TECHNICAL ANALYSIS CHART:
Technical Overview:
USD/CAD is trading within an up channel.
USD/CAD is moving above 50&100 Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Neutral Zone, while the Stochastic oscillator suggests a Neutral trend.
Immediate Resistance level: 0.5910
Immediate support level: 0.5797
HOW TO TRADE USD/CAD
After a sharp decline, USD/CAD found support and reversed to the upside, showing renewed bullish momentum. The pair has since broken through a key resistance level and is now retesting the zone. If this area holds, USD/CAD is likely to extend its upward move further.