Daily Forex Briefing, Feb 5 – Top Trade Setups in USD/CAD & AUD/USD
Arslan Butt • 2 min read
- The dollar takes a bearish turn to trade at $95.565, down 0.01% for the day.
- The Australian dollar climbed, turning earlier losses, following the Reserve Bank of Australia (RBA) interest rate decision.
- The ISM Non-Manufacturing PMI from the United States remains under the spotlight today.
- Check out quick trade ideas on AUD/USD and USD/CAD today.
Key Economic Events Today
At 9:30 (GMT), the Markit is due to release services PMI data which may impact the GBP today. Economists are expecting a slight drop in figures from 51.2 to 51.1 this month. However, this drop isn’t big enough to trigger major fluctuations in the market.
The Institute for Supply Management is due to release services PMI figures at 15:00 (GMT) with a forecast of 57.2 vs. 57.6. The figure is consistently getting weaker month by month. I remember how the US Services PMI figure was sitting at 61.6 in October 2018. It can keep the US Dollar under pressure today.
AUD/USD – Aussie Spikes on RBA, What’s Coming Next?
During the Asian session, the Aussie rose, recovering earlier losses after the Reserve Bank of Australia (RBA) kept the interest rates at record lows. It was the very first of the year and the RBA sounded less dovish than expected.
Technically, the AUD/USD has shown sharp bullish moves to trade around $0.7290. With that, the pair seems to form an ascending triangle pattern which may help us secure a good trade opportunity.
On the 2 hour chart, the ascending triangle pattern is likely to support the pair at around $0.7230 along with resistance around $0.7295. By then, we can expect the pair to become oversold and offer us a quick sell in Aussie.
Key Trading Level: 0.7226
AUD/USD – Trade Plan
The idea is to stay bullish above $0.7245 until $0.7290. While selling is preferred below $0.7295 today.
USD/CAD – Update on CAD Trading Signal
The commodity currency strengthens against the Greenback due to sudden weakness in the US dollar. As we spoke earlier, crude oil is suffering a lot due to bearish fundamentals and ultimately spilling its impact on the Canadian dollar.
The USD/CAD pair is currently trading at $1.3125 and can continue trading lower below $1.3140 resistance. The immediate support can be seen around $1.3070 and $1.3030 as relative strength index (RSI) on the 4-hour chart is signaling a bearish crossover.
Key Trading Level: 1.3114
USD/CAD – Trade Plan
Keeping the technicals in mind, team FX Leaders has opened a short-term forex trading signal on USD/CAD. The signal is to stay bearish below 1.3114 with a stop above 1.3154 and take profit at 1.3084.
Good luck and stay tuned for more updates!