The USDCAD pair continues to show strength over the last couple of days as the employment and wages data from Canada seems to be having a much larger effect on the prices than what was originally expected. Despite this, the pair has not been able to make much of a run but considering the fact that the downtrend has been so large and swift as well, it is indeed an achievement for the bulls in the USDCAD pair if the pair manages to hold its levels for a couple of days.
USDCAD At Crucial Stage
The employment report from Canada had shown a drop in the higher paying jobs and that has affected the CAD for the short term. Also, the price had reached the region where a strong support exists around the large round figure and this combination has helped the pair to survive so far. We had warned of a bounce from this region and thats what we have been seeing. The bounce has been shallow so far but it could also be due to the fact that the market is waiting for news.
The bounce has yielded less than 100 pips so far over the last couple of days as the pair struggles to break through the 1.3150 region. The strong and steady oil prices have been providing some decent support to the CAD and this has helped the pair to consolidate and range over the last 24 hours. The dollar has also been holding steady during this period.
Looking ahead to the rest of the day, we are entering into that part of the week when a lot of data begins to roll in and this is what the market is looking ahead to. We have the PPI data from the US and this is likely to be watched pretty closely as it will give a real glimpse of the strength of the US economy after the mixed and choppy data from the US over the last couple of week.s With the CPI data also scheduled to be released later in the week, we will have to see whether the downtrend in the USDCAD pair continues or whether we get a reversal.
This article was originally posted on FX Empire
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