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Today’s Canadian retail sales release got me looking at USD/CAD possibly extending its uptrend after seeing a retracement. What do you think?

Currency Snapshot:

Major Forex Pairs Price Performance from MarketMilk[
Major Forex Pairs Price Performance from MarketMilk[

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

  • Germany’s PPI at 7:00 am GMT
  • Euro Zone’s current account data at 9:00 am GMT
  • U.K.’s consumer inflation expectations at 9:30 am GMT
  • Canada’s retail sales at 1:30 pm GMT

What to Watch: USD/CAD

USD/CAD 1-hour Forex Chart
USD/CAD 1-hour Forex Chart

Monetary and fiscal policy changes implemented over the last 24 hours eased some of the investors’ concerns. The establishment of swap lines between major central banks, in particular, encouraged risk appetite even until the Asian session.

How long can dollar bears keep up the pressure? USD/CAD is heading towards the 1.4200 major psychological handle that’s near a 50% Fib retracement, 100 SMA, and a rising trend line retest.

If today’s Canadian retail sales data prints stronger than markets are expecting, then we could see USD/CAD revisit the trend line and hit levels closer to the 61.8% Fib retracement.

If Loonie bears go back to their selling, however, then USD/CAD could bounce somewhere between the Fibs and make its way back to its 1.4630 previous highs.