USDCAD losing key support
Gary Christie November 30, 2020 4:08 PM
The pair is attempting to break below 3 month long consolidation.
The US Dollar was bullish against most of its major pairs on Monday with the exception of the CAD and GBP. On the US economic data front, Market News International's Chicago Business Barometer dropped to 58.2 on month in November (59.0 expected), from 61.1 in October. Finally, Pending Homes Sales declined 1.1% on month in October (+1.0% expected), compared to a revised -2.0% in September.
On Tuesday, Markit's US Manufacturing Purchasing Managers' Index for the November final reading is expected to remain at 56.7 on month, in line with the November preliminary reading. Finally, Construction Spending for October is expected to rise 0.8% on month, compared to +0.3% in September.
The Euro was bearish against most of its major pairs with the exception of the AUD and JPY. In Europe, the German Federal Statistical Office has posted November CPI at -0.8% (vs -0.4% expected). Also, the Bank of England has released the number of mortgage approvals for October at 97,500 (vs 84,000 expected).
The Australian dollar was bearish against all of its major pairs.
We have been watching the USD/CAD pair closely over the last week. The pair has now broken below support at 1.299 after consolidating since September. It is looking like the downtrend that began back in March is about to continue. We would prefer to see some more downside momentum before we can rule out any potential continuation of the consolidation. Traders will be watching how price action reacts around the 1.30 level. The next major support area is at 1.2805.
Source: GAIN Capital, TradingView
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.