USD/CAD is trading below its 1-hour SMAs!
Has the pair given up its uptrend?
Before moving on, ICYMI, yesterday’s watchlist looked at USD/CHF’s Double Top pattern on the 4-hour time frame. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
US ADP: Businesses added 208K jobs in Sept vs. 200K expected, 185K in Aug
US ISM services PMI unexpectedly dips from 56.9 to 56.7 in Sept
Canada building permits increased by 11.9% in Aug
Canada’s trade surplus falls to 2022-low on oil price dropOPEC and friends agree to cut production by 2 million barrels per day
US trade deficit narrowed by 4.3% to $67.4B in Aug, the lowest since May 2021
US weekly EIA crude oil inventories -1356K vs +2052K expected
AU construction sector shrinks for fourth month to 46.5 in Sept
AU trade surplus unexpectedly narrows from 9B AUD to 8.3B AUD on import strength
Asian shares rise, oil extends gains after OPEC+ deal
German industrial orders slump by 2.4% more than 0.7% dip expected in Aug
Oil hovers near three-week highs after OPEC+ agrees to slash crude output
European shares rise ahead of key data, ECB minutes
Upcoming Potential Catalysts on the Forex Economic Calendar:
ECB’s meeting minutes at 7:30 pm GMT
US Challenger job cuts at 8:30 pm GMT
US initial jobless claims at 8:20 am GMTs
Canada’s IVEY PMI at 10:00 pm GMT
BOC Gov. Macklem to talk economics in Nova Scotia at 11:35 pm GMT
Japan’s average cash earnings at 7:30 am GMT (Oct 7)
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: USD/CAD
USD/CAD 1-hour Forex Chart
If you recall, easing U.S. Treasury yields and risk-taking at the start of the month have dragged the U.S. dollar lower across the board.
In USD/CAD’s case, all the dollar selling led to the pair trading below a trend line support and the 100 SMA crossing below the 200 SMA.
Does this mean that USD/CAD’s uptrend is over?
Eh, maybe it’s just finding its next direction.The pair is now trading inside a 1-hour range and it looks like it’s about to test its mid-range levels near the SMAs.
Today’s Canadian IVEY PMI and U.S. labor market data can help paint a clearer picture of the pair’s direction.
Strong U.S. labor market numbers will give the Fed more room to raise its interest rates.
This could lead to USD/CAD busting above its 1-hour SMAs and possibly retesting its 1.3800 highs.
Meanwhile, extended risk-taking can drag USD lower against the commodity-related CAD.
Keep an eye out for a rejection at 1.3650 and a possible trip to the 1.3500 range support.
