USDCAD Technical Analysis – Bullish Bias Intact

<p>The <a href="https://www.forexlive.com/news/us-june-non-farm-payrolls-209k-vs-225k-expected-20230707/">NFP report</a> last Friday missed expectations for
the first time after 14 consecutive beats. The other data though were still all
solid with the average hourly earnings ticking higher, which is not what the
Fed would like to see. In fact, the market expectations for a 25 bps hike at
the July meeting remained unchanged, but despite this, the USD weakened across
the board. </p><p>The BoC is expected to hike
by 25 bps tomorrow as the inflation rate continues to be high and the jobs
market remains tight. There is also a chance that the BoC decides to skip this
meeting, which should give the USDCAD a boost to the upside, especially if the
US CPI beats expectations.</p><p>USDCAD Technical Analysis –
Daily Timeframe</p><p>On the daily chart, we can see that the break below
the key 1.3225 support might
have been just a fakeout and now we may see more upside for the pair. In fact,
the moving averages have now
crossed to the upside as the bullish momentum prevailed. The buyers are likely
to step in now leaning on the red 21 moving average near the 1.3225 support and
target the 1.3664 resistance. </p><p>USDCAD Technical Analysis –
4 hour Timeframe</p><p>On the 4 hour chart, we can see that after the
break above the <a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/">trendline</a> USDCAD
rallied and consolidated around the 1.3225 level before pushing to the upside
again. The miss in the US NFP report though, caused some weakness in the
greenback and the pair fell towards the 1.3225 support again. The sellers will
need the price to break below the 1.3225 support decisively to get back control
and target new lows. </p><p>USDCAD Technical Analysis –
1 hour Timeframe</p><p>On the 1 hour chart, we can see that we
have a <a href="https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/">divergence</a> with
the <a href="https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/">MACD</a> which
is generally a sign of weakening momentum often followed by pullbacks or
reversals. If we do get a pullback, a good spot for the sellers to lean on to
is the 1.33 handle where we can also find the 38.2% <a href="https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/">Fibonacci retracement</a> level
and the 4-hour 21 moving average for confluence. A
break above that resistance would see the buyers entering the market more
aggressively and start the rally towards the 1.3664 resistance. </p><p>Upcoming Events</p><p><a href="https://www.forexlive.com/EconomicCalendar">Tomorrow</a>
we will see the latest US CPI report. which is the main event of the week. A
miss to the expected numbers, especially on the core figures, should cause more
USD weakness as the market would price out the hawkish bets and price in a more
dovish path. Conversely, if the data beats forecasts, we should see the USD
higher across the board as the market would price in a more hawkish Fed. We
then conclude the week with the US Jobless Claims on Thursday and the
University of Michigan Consumer Sentiment report on Friday.</p>

This article was written by FL Contributors at www.forexlive.com.