USDCAD Technical Analysis – Compressing between key levels
<h2><strong><span>USD</span></strong></h2><ul><li><span>The Fed </span><span><a href="https://www.forexlive.com/centralbank/federal-reserve-interest-rate-decision-no-change-20231101/"><span>left interest rates unchanged</span></a></span><span> as
expected with basically no change to the statement.</span></li><li><span><a href="https://www.forexlive.com/centralbank/powell-opening-statement-the-committee-is-proceeding-carefully-20231101/"><span>Fed Chair Powell</span></a></span><span> stressed
once again that they are proceeding carefully as the full effects of policy
tightening have yet to be felt.</span></li><li><span>The recent </span><span><a href="https://www.forexlive.com/news/us-october-core-cpi-40-yy-versus-41-yy-expected-20231114/"><span>US CPI</span></a></span><span> missed
expectations across the board bringing the expectations for rate cuts
forward.<span> </span></span></li><li><span>The </span><span><a href="https://www.forexlive.com/news/us-august-non-farm-payrolls-187k-vs-170k-expected-20230901/"><span>labour market</span></a></span><span> is
starting to show weakness as </span><span><a href="https://www.forexlive.com/news/us-initial-jobless-claims-231k-vs-220k-estimate-20231116/"><span>Continuing Claims</span></a></span><span> are now
rising at a fast pace and the recent </span><span><a href="https://www.forexlive.com/news/us-october-non-farm-payrolls-150k-vs-180k-expected-20231103/"><span>NFP</span></a></span><span> report
missed across the board.</span></li><li><span>The </span><span><a href="https://www.forexlive.com/news/us-october-consumer-confidence-1026-vs-1000-expected-20231031/"><span>US Consumer
Confidence</span></a></span><span> and </span><span><a href="https://www.forexlive.com/news/us-november-prelim-umich-consumer-sentiment-604-vs-637-expected-20231110/"><span>University of
Michigan Consumer Sentiment</span></a></span><span> continue to fall.</span></li><li><span>The latest </span><span><a href="https://www.forexlive.com/news/us-september-ism-manufacturing-pmi-467-vs-490-expected-20231101/"><span>US ISM
Manufacturing PMI</span></a></span><span> missed expectations by a big margin,
followed by a disappointing </span><span><a href="https://www.forexlive.com/news/us-october-ism-services-518-vs-530-expected-20231103/"><span>ISM Services PMI</span></a></span><span>,
although the latter remained in expansion.</span></li><li><span>The recent </span><span><a href="https://www.forexlive.com/news/us-october-retail-sales-01-vs-03-expected-20231115/"><span>US Retail Sales</span></a></span><span> beat
expectations, while the </span><span><a href="https://www.forexlive.com/news/us-october-ppi-13-versus-19-expected-20231115/"><span>US PPI</span></a></span><span> missed
forecasts by a big margin. </span></li><li><span>The recent Fedspeak has been leaning on
the hawkish side, but last week’s inflation report pretty much confirmed that
the Fed might be done for the cycle. </span></li><li><span>The </span><span><a href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html"><span>market</span></a></span><span> doesn’t
expect the Fed to hike anymore.</span></li></ul>
<h2><strong><span>CAD</span></strong></h2>
<ul><li><span>The BoC </span><a href="https://www.forexlive.com/centralbank/bank-of-canada-decision-rates-held-unchanged-at-500-as-expected-20231025/"><span>left interest rates at 5.00%</span></a><span><span> as</span></span><span> expected but remains prepared to
raise rates further if needed.</span></li><li><span>BoC </span><a href="https://www.forexlive.com/centralbank/bocs-macklem-we-are-seeing-clear-evidence-that-higher-rates-are-working-20231025/"><span>Governor Macklem</span></a><span> delivered a less hawkish speech in
the press conference compared to his previous remarks. </span></li><li><span>The recent </span><a href="https://www.forexlive.com/news/canada-september-cpi-38-versus-40-expected-20231017/"><span>Canadian CPI</span></a><span> missed expectations across the
board and the underlying inflation measures eased, which was a welcome
development for the BoC. </span></li><li><span>On the </span><a href="https://www.forexlive.com/news/canada-october-employment-175k-vs-225k-expected-20231103/"><span>labour market</span></a><span> side, the latest report missed expectations
across the board with negative figures in full-time employment and slowing wage
growth, which is going to be another positive outcome for the central bank.</span></li><li><span>The market doesn’t expect the BoC to
hike anymore.</span></li></ul>
<p><strong><span> </span></strong><br></p>
<h2><strong><span>USDCAD Technical Analysis –
Daily Timeframe</span></strong></h2><figure data-media-><img src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_2e56ea92-782a-4d4c-beb6-df6fed6c121f_size900.jpg" alt="USDCAD Technical Analysis" width="1369" height="753" wrapper-="wrapper-" data-src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_2e56ea92-782a-4d4c-beb6-df6fed6c121f_size900.jpg" /><figcaption><div>USDCAD Daily</div></figcaption></figure><p><span>On the daily chart, we can see that USDCAD is now
consolidating between the key 1.3860 </span><span><a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/"><span>resistance</span></a></span><span> and the
major </span><span><a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/"><span>trendline</span></a></span><span>. The
price action has been messy lately with no clear direction, so the market
participants might want to wait for the price to react to the key levels before
opening new positions. </span></p>
<h2><strong><span>USDCAD Technical Analysis –
4 hour Timeframe</span></strong></h2><figure data-media-><img src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_f58a5258-a2bb-4616-ad46-eb875c0a3560_size900.jpg" alt="USDCAD Technical Analysis" width="1372" height="754" wrapper-="wrapper-" data-src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_f58a5258-a2bb-4616-ad46-eb875c0a3560_size900.jpg" /><figcaption><div>USDCAD 4 hour</div></figcaption></figure><p><span>On the 4 hour chart, we can see that there’s no
clear trend and therefore no clear level the market participants can lean on
to. The buyers are likely to wait for the price to come into the major
trendline to position for a rally into the 1.3860 resistance and target a break
above it. The sellers, on the other hand, will be both leaning on the
resistance and increase the bearish bets in case the price breaks below the
major trendline. </span></p>
<h2><strong><span>USDCAD Technical Analysis –
1 hour Timeframe</span></strong></h2><figure data-media-><img src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_90b4bc42-233b-45e9-b8d3-411adb04599c_size900.jpg" alt="USDCAD Technical Analysis" width="1368" height="756" wrapper-="wrapper-" data-src="https://images.forexlive.com/images/USDCAD%20Technical%20Analysis_id_90b4bc42-233b-45e9-b8d3-411adb04599c_size900.jpg" /><figcaption><div>USDCAD 1 hour</div></figcaption></figure><p><span>On the 1 hour chart, we can see that on
this timeframe we have some interesting levels where the price reacted to
multiple times. In fact, we can expect more buyers to come into the market if
the price breaks above the 1.3750 resistance to target the key 1.3860 level. Conversely,
if the price breaks below the support around the 1.37 handle, the sellers are
likely to pile in to target the major trendline and increase the bearish bets
if the price falls below the trendline. </span></p>
<h2><strong><span>Upcoming Events</span></strong></h2>
<p><a href="https://www.forexlive.com/EconomicCalendar"><span>This week</span></a><span> is pretty empty on the data front with the US
on holiday for Thanksgiving Day in the final part of the week. Today, we have
the Canadian CPI which is not expected to change much for the BoC given the
softening labour market, and then later in the day we will get the FOMC Meeting
Minutes. Tomorrow, we have the US Jobless Claims report which is probably going
to be the most important release of the week. On Friday, we conclude the week
with the latest US PMIs.</span></p>
This article was written by FL Contributors at www.forexlive.com.
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