USDCAD Jumps to 2-Yr Highs after Canadian Data
23 September 2022
The USDCAD pair continued in its uptrend, bolstered by the broad strength of the US dollar, jumping above the 1.35 resistance for the first time since July 2020.
Canadian data below forecasts
According to figures released by Statistics Canada on Friday, retail sales decreased by 2.5% on a monthly basis in July after rising by 1% in June. This reading was weaker than the market anticipated, which was a 2% fall.
The report continued, "Core retail sales—which do not include petrol stations and dealers in motor vehicles and parts—decreased 0.9%." "Retail sales declined 2.0% in volume terms in July."
A worsening gasoline demand picture continues to weigh on crude oil prices and weaken the commodity-linked loonie despite concerns about a constrained global supply. The WTI benchmark was down 4% today, falling toward the important 80 USD level.
In addition, the USDCAD pair benefits from the strong positive mood around the US dollar, which is supported by aggressive Fed predictions.
Is market overbought?
The short-term chart looks rather indecisive as an excellent triangle pattern has been formed, with the resistance near 1.3540 and the support zone at the uptrend line at 1.35
If the pair jumps above 1.3540, we might see another rally toward the 1.36 level. On the other hand, a failure to stay above 1.35 could send the pair down, targeting 1.34.