Published on Mar 23, 2023

Daily Analysis For USD/CAD 23-03-2023

USD/CAD Analysis

Economic Events and Scenario for USD/CAD

Economic Events : -

GMT	Event	Impact	Currency
07:00	(Lithuania) Industrial Production YoY	Low	EUR
07:00	(Lithuania) Industrial Production MoM	Low	EUR
08:00	(European Union) European Council Meeting	Medium	EUR
08:30	(Switzerland) SNB Interest Rate Decision	Medium	CHF
09:00	(Greece) Current Account	Low	EUR
09:30	(Slovenia) Consumer Confidence	Low	EUR
11:30	(Germany) Bundesbank Balz Speech	Low	EUR
12:00	(United Kingdom) BoE Interest Rate Decision	High	GBP
12:00	(United Kingdom) MPC Meeting Minutes	Medium	GBP
12:00	(United Kingdom) BoE MPC Vote Hike	Medium	GBP
12:00	(United Kingdom) BoE MPC Vote Unchanged	Medium	GBP
12:00	(United Kingdom) BoE MPC Vote Cut	Medium	GBP
12:00	(United States) Building Permits	Medium	USD
12:00	(United States) Building Permits MoM	Low	USD
12:00	(Germany) undesbank Wuermeling Speech	Low	EUR
12:30	(United States) Current Account	Medium	USD
12:30	(United States) Jobless Claims 4-week Average	High	USD
12:30	(United States) Continuing Jobless Claims	High	USD
12:30	(United States) Initial Jobless Claims	High	USD
12:30	(United States) Chicago Fed National Activity Index	Medium	USD
14:00	(United States) New Home Sales MoM	High	USD
14:00	(United States) New Home Sales	High	USD
14:30	(United States) EIA Natural Gas Stocks Change	Low	USD
15:00	(Euro Area) Consumer Confidence	Medium	EUR
15:00	(United States) Kansas Fed Composite Index	Low	USD
15:00	(United States) Kansas Fed Manufacturing Index	Low	USD
15:00	(United Kingdom) BoE L Mann Speech	Medium	GBP
15:00	(Euro Area) ECB Lane Speech	Low	EUR
15:30	(United States) 8-Week Bill Auction	Low	USD
15:30	(United States) 4-Week Bill Auction	Low	USD
17:00	(United States) 10-Year TIPS Auction	Low	USD
22:00	(Australia) Judo Bank Manufacturing PMI	High	AUD
22:00	(Australia) Judo Bank Services PMI	High	AUD
22:00	(Australia) Judo Bank Composite PMI	Low	AUD
23:30	(Japan) Inflation Rate Ex-Food and Energy YoY	Low	JPY
23:30	(Japan) Inflation Rate YoY	High	JPY
23:30	(Japan) Inflation Rate MoM	Low	JPY
23:30	(Japan) Core Inflation Rate YoY	Medium	JPY
23:50	(Japan) Foreign Bond Investment	Low	JPY
23:50	(Japan) Stock Investment by Foreigners	Low	JPY

Today's Scenario: - USD/CAD declined on Wednesday, breaking below a two-week-old resistance line, and continued its downward momentum on Thursday's European session. The currency pair is currently testing a significant support confluence at around 1.3660-65, formed by the 21-day Exponential Moving Average (EMA) and a horizontal line that was previously a resistance level in early January. The bearish signals are further reinforced by the MACD signals and the RSI (14) line, which are both indicating a downward trend. The pair may continue to face selling pressure, and a break below the support confluence could lead to further declines towards the next support level at 1.3615.

Buy Scenario: - the USD/CAD pair will depend on the ability to close above the aforementioned resistance line, which is close to 1.3725 at the moment.

If the pair manages to surpass this resistance, the 1.3755-65 zone could act as an additional obstacle before pushing the USD/CAD bulls towards the monthly high of 1.3861. Till we do not advise to buy USD/CAD.

Sell Scenario: - Taking into account the factors mentioned, if the USD/CAD bears manage to break the 1.3660 level, they could witness a decline of almost 100 pips, which emphasizes the importance of the monthly low of 1.3555 that also happens to be the 50% Fibonacci retracement level of the pair's upside move from February to March.

If the quote weakens past 1.3555, the January 19 swing high and the 61.8% Fibonacci retracement level, known as the golden Fibonacci ratio, could offer support to the USD/CAD bears at around 1.3520 and 1.3490, respectively. Till we do not advise to sell USD/CAD.

Support and Resistance Level: -