USD/CAD ignores Canadian data, remains focused on Oil

FXStreet (Mumbai) - The CAD traders turned a blind eye towards a mixed batch of Canadian data and pushed USD/CAD to a fresh session low of 1.4139 tracking the 5% rally in oil prices.

Weekly loss on cards

The sharp fall in oil today and the resulting drop in the USD/CAD mean the weekly loss is almost a done deal now. The oversold oil prices are witnessing correction and so is the oversold Canadian dollar.

A better-than-expected Canada retail sales and a drop in the consumer price index is being ignored by the markets as of now. Ahead in the day, Oil prices could continue to guide the pair. The US data – manufacturing PMI and existing home sales may affect demand for the US dollars.

USD/CAD Technical Levels

The pair now trades around 1.4168. The immediate support is seen at 1.41 handle, under which the pair could drop to 1.3980 (38.2% of 1.2832-1.4690). On the other hand, a break above 1.4251 (23.6% of 1.2832-1.4690) could see the pair re-test 1.4378 (10-DMA).

Jan 22, 2016

Canada's CPI contracted in December, came in at -0.5% MoM

Canada’s December CPI contracted more than expected, dropping 0.5 per cent month on month. It had declined 0.1 per cent in November. Year on year, CPI rose 1.6 per cent in December, lower than the expected 1.7 per cent increase but higher than 1.4 per cent year on year growth seen in November.

Canada retail sales increased 1.7% MoM in November beating estimates

Retail sales rose 1.7% in November to $44.3 billion, up from 0.1 per cent seen previously. Higher sales at new car dealers were the main contributor to the gain. With the exception of gasoline stations, all subsectors showed an increase in sales, representing 90% of retail trade. In volume terms, retail sales were up 1.5%.