USD/CAD: the pair retreats from local highs
Current trend
The US dollar is falling against the Canadian currency at the beginning of a new trading week, retreating from local highs, updated last Friday, and testing the level of 1.2470 for a breakdown. Investors are in no hurry to open new positions in anticipation of the publication of the minutes of the meeting of the US Federal Reserve. In turn, the USD Index is moving towards resistance at 99.000 and if it manages to consolidate above this level, it will head towards the next resistance at 99.200, which could push USD/CAD to new growth.
The extremely tense situation around Ukraine remains in the spotlight. At the beginning of the week, market participants are again actively discussing the possibility of introducing new sanctions against the Russian economy, which may significantly limit the import of Russian energy resources to Europe, and the changes may also affect the financial sector.
Canadian macroeconomic statistics released on Monday provided moderate support for the national currency. Building Permits issued in February showed a record increase of 21% after declining by 8.2% a month earlier. Traders also focused on the US government bond market: the yield on 2-year bonds fell to 2.44%, but this movement did not put significant pressure on the US currency. Today, the publication of February data on the dynamics of imports and exports in Canada is expected, and the release of the March report on the Canadian labor market will take center stage on Friday.
Support and resistance
Bollinger Bands in D1 chart demonstrate quite active decrease. The price range is narrowed, being spacious enough for the current activity level in the market. MACD indicator is growing keeping a weak buy signal (located above the signal line). Stochastic shows similar dynamics, being located approximately in the center of its area and signaling the possibility of further development of "bullish" trend in the ultra-short term.
Resistance levels: 1.2538, 1.2600, 1.2650, 1.2700.
Support levels: 1.2450, 1.2400, 1.2335, 1.2300.
The US dollar is falling against the Canadian currency at the beginning of a new trading week, retreating from local highs, updated last Friday, and testing the level of 1.2470 for a breakdown. Investors are in no hurry to open new positions in anticipation of the publication of the minutes of the meeting of the US Federal Reserve. In turn, the USD Index is moving towards resistance at 99.000 and if it manages to consolidate above this level, it will head towards the next resistance at 99.200, which could push USD/CAD to new growth.
The extremely tense situation around Ukraine remains in the spotlight. At the beginning of the week, market participants are again actively discussing the possibility of introducing new sanctions against the Russian economy, which may significantly limit the import of Russian energy resources to Europe, and the changes may also affect the financial sector.
Canadian macroeconomic statistics released on Monday provided moderate support for the national currency. Building Permits issued in February showed a record increase of 21% after declining by 8.2% a month earlier. Traders also focused on the US government bond market: the yield on 2-year bonds fell to 2.44%, but this movement did not put significant pressure on the US currency. Today, the publication of February data on the dynamics of imports and exports in Canada is expected, and the release of the March report on the Canadian labor market will take center stage on Friday.
Support and resistance
Bollinger Bands in D1 chart demonstrate quite active decrease. The price range is narrowed, being spacious enough for the current activity level in the market. MACD indicator is growing keeping a weak buy signal (located above the signal line). Stochastic shows similar dynamics, being located approximately in the center of its area and signaling the possibility of further development of "bullish" trend in the ultra-short term.
Resistance levels: 1.2538, 1.2600, 1.2650, 1.2700.
Support levels: 1.2450, 1.2400, 1.2335, 1.2300.
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