USD/CAD has been extremely bearish since last March, when it reversed from 1.4660s. It has been on a constant downtrend since then, losing around 23 cents from top to bottom, which it put in place by the middle of March,

Other currencies turned bearish against the USD in March, but the Canadian Dollar kept crawling higher, which kept this pair bearish. Moving averages have been doing a great job on the daily chart, providing resistance during pullbacks higher and pushing the price down.

During the second week of March we saw another retrace higher, but the 50 SMA (yellow) stopped the climb and the decline resumed again this month. Now, USD/CAD is heading toward the March low at 1.2360s.

USD/CAD Live Rate

The economic data from Canada has shown improvement for the first few months of this year, which has also been helping the bearish momentum here. Today, the retail sales report showed a decent jump in February, although it came from a considerable decline in January due to coronavirus restrictions.

Canada February 2021 retail sales data

• February retail sales +4.8% vs +4.0% expected
• January sales were -1.1%
• Statistics Canada advance estimate was +4.0%
• Core sales excluding autos +4.8% vs +3.5% expected
• March advance estimate +2.3% based on 65% of responses
  
• Sales up in 9 of 11 sub-sectors led by motor vehicles
• 12% of retailers were closed in at some point in Feb
• Clothing and accessories +23.7% vs -17.8% m/m prior
• Furniture +18.0% vs -15.1% prior
• General merchandise stores +6.1% vs+3.3% prior
• Building material and garden equip +3.5% vs +2.9% prior
• Motor vehicles and parts +5.0% vs -1.0% prior led by new car dealers