USD/CAD: updating March local highs
Current trend
The US dollar is showing weak "bearish" dynamics during the Asian session, correcting after a three-day rally that took the instrument to new highs from March 22. Sales of the Canadian currency this week intensified after a local decline in oil prices.
However, according to data for February, exports of Canadian "black gold" increased by 7.8%, amounting to 58.75 billion Canadian dollars, while imports were fixed at around 56.08 billion Canadian dollars, which indicates the continuation of the trade surplus. The growing geopolitical tension will continue to contribute to an increase in energy prices against the backdrop of a continuing shortage of supply, which will allow the Canadian dollar to regain the interest of the "bulls".
Today, investors are focused on the March report on the Canadian labor market. Analysts' forecasts are quite modest, and therefore the national currency is unlikely to receive significant support from the publication. It is assumed that the Net Change in Employment in March will show an increase of only 80K, slowing down from the previous increase of 336.6K. At the same time, the Participation Rate is expected to remain at the same level of 65.4%, while the Unemployment Rate may drop from 5.5% to 5.4%.
Support and resistance
In the D1 chart, Bollinger Bands are reversing horizontally. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic shows a similar dynamics but the indicator line is approaching its highs, which reflects risks of the overbought USD in the ultra-short term.
Resistance levels: 1.2600, 1.2650, 1.2700, 1.2750.
Support levels: 1.2538, 1.2450, 1.2400, 1.2350.
The US dollar is showing weak "bearish" dynamics during the Asian session, correcting after a three-day rally that took the instrument to new highs from March 22. Sales of the Canadian currency this week intensified after a local decline in oil prices.
However, according to data for February, exports of Canadian "black gold" increased by 7.8%, amounting to 58.75 billion Canadian dollars, while imports were fixed at around 56.08 billion Canadian dollars, which indicates the continuation of the trade surplus. The growing geopolitical tension will continue to contribute to an increase in energy prices against the backdrop of a continuing shortage of supply, which will allow the Canadian dollar to regain the interest of the "bulls".
Today, investors are focused on the March report on the Canadian labor market. Analysts' forecasts are quite modest, and therefore the national currency is unlikely to receive significant support from the publication. It is assumed that the Net Change in Employment in March will show an increase of only 80K, slowing down from the previous increase of 336.6K. At the same time, the Participation Rate is expected to remain at the same level of 65.4%, while the Unemployment Rate may drop from 5.5% to 5.4%.
Support and resistance
In the D1 chart, Bollinger Bands are reversing horizontally. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic shows a similar dynamics but the indicator line is approaching its highs, which reflects risks of the overbought USD in the ultra-short term.
Resistance levels: 1.2600, 1.2650, 1.2700, 1.2750.
Support levels: 1.2538, 1.2450, 1.2400, 1.2350.
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