USD/CAD Pulls Back to Trim Weekly Gains After US GDP

The USD/CAD currency pair on Thursday pulled back off 8-day highs of about 1.3460 to trade at around 1.3424 after the latest round of US data. The currency pair continues to trade within a descending channel in the 60-min chart amid increased bearish pressure.

The pair still remains pegged above the current level of the 100-hour and the 200-hour SMA lines. Today’s late pullback also pushed it off overbought levels of the 14-hour RSI following a huge run during the week.

USD/CAD Fundamentals Overview

From a fundamental perspective, the USD/CAD currency pair is trading at the back of a relatively busy period in the US market. Earlier this week, durable goods orders ex-transportation and durable goods orders ex-defense for June missed the expectations of 3.5% and 18.6% with 3.3% and 9.2%, respectively. On the other hand, general durable goods orders and capital goods orders ex-aircraft outperformed 7.2% and 2.3% with 7.3% and 3.3%, respectively.

On Thursday, the preliminary US GDP for Q2 missed the expectation of 1.1% with -2.1%. However, annualized Q2 GDP beat -34.1% with -32.9%. The initial jobless claims also outperformed 1.45M with 1.434M while continuing claims and personal consumption expenditure for July came short of expectations. The coronavirus pandemic appears to be taking a toll on the US dollar.

USD/CAD Technical Analysis (the 60-min Chart)

Technically, the USD/CAD currency pair appears to be trading within a descending channel in the 60-min chart. This indicates a short-term bearish bias in the market sentiment. The pair bounced off the trendline support earlier in the week but pulled back again on Thursday. 

The bears will be looking to extend the current bearish run by targeting profits at around 1.3361 or lower at 1.3303. On the other hand, the bulls will look to capitalize on this week’s rebound by targeting profits at around 1.3487 or higher at 1.3555.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair appears to be trading within a sharply descending channel. This indicates a strong long-term bearish bias in the market sentiment.

The bulls will be targeting long-term profits at around 61.80% and 50% Fib levels at 1.3656 and 1.3823, respectively. On the other hand, the bears will look to pounce for profits at around 1.3131 or lower at 1.2951.

https://fxdailyreport.com/usd-...