⚡ Easily Trade – Apple, Microsoft, Tesla and Google Stocks – Open a FREE Account Here


USD/CAD Completes 61.8% Fibonacci Retracement – What’s Next?

Posted Friday, July 17, 2020 by
Arslan Butt • 2 min read

The USD/CAD pair closed at 1.35740, after a high of 1.35813 and a low of 1.35014. Overall, the movement of the USD/CAD pair remained bullish throughout the day. AT 17:30 GMT, the ADP Non-Farm Employment Change from Canada for June rose to 1042.9K, compared to -2951.4K in May. The Foreign Security Purchases made from Canada in May were 22.41B, compared to 49.03 B in April.

Canada created 953 thousand jobs in June, and the ADP Nonfarm Payrolls report showed a 1.042 Million increase in employment. This indicated that the job sector was improving rapidly in Canada.

On Wednesday, the Bank of Canada held rates unchanged at 0.25%, and Governor Tiff Macklem said that rates would not be increased until the inflation target of 2%, which was set by the bank, was met. Reaching 2% inflation will take time, as the BoC is expecting an inflation rate of 0.6% in 2020 and 1.2% in 2021. The Central Bank also forecast that Canada’s GDP would contract by 6.8% this year, before rebounding by 4.9% in 2021.
The better-than-expected job data and improving economic outlook indicated by the Bank of Canada gave the Canadian dollar a push, limiting gains in USD/CAD pair.

On the US front, the Retail Sales & Core Retail Sales data was also cheered by the traders, as they increased to 7.5% and 7.3% respectively, against the expectations of 5%, providing strength to the US dollar. The strong US dollar pushed the USD/CAD pair to the upside.

On the WTI Crude Oil front, crude oil prices decreased, falling below the $41 level on Thursday, as OPEC and its allies indicated their willingness and consent to reduce supply cuts as of August. This news weighed on the crude oil prices and the commodity-linked currency Loonie, which helped the USD/CAD pair to post additional gains.

Some good news raised optimism in the market after US President Donald Trump decided to revert orders to impose sanctions on top Chinese officials responsible for implementing Hong Kong’s national security laws. However, the White House National Security Council spokesman said on Wednesday, that Trump had not ruled out the possibility of further sanctions. The optimism raised the US dollar prices, hence again in traction for the USD/CAD pair.

Daily Technical Levels
Support Resistance
1.3520 1.3602
1.3469 1.3633
1.3438 1.3684
Pivot point: 1.3551

The USD/CAD consolidates in a wide trading range between 1.3625 to 1.3500 these days. But within this range, the USD/CAD is likely to find immediate resistance at the 1.3585 level. A bullish crossover at this level could open further room for buying, until the 1.3625 level, while on the lower side, the support remains at around 1.3549. Good luck! 


Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Related Articles
0 0 votes
Article Rating
Notify of
Inline Feedbacks
View all comments