USD/CAD: Canadian Dollar Improves Despite Soft Retail Sales

The Canadian dollar is steady in the Friday session. Currently, the is trading at 1.1390, down 0.32% on the day. On the release front, Canadian retail sales reports were soft, as expected. declined 0.5%,matching the estimate. fell 0.1%, shy of the forecast of 0.0%. In the U.S., there are no data releases, but we’ll hear from a host of FOMC members, with the markets hoping for some insights into future monetary policy.

Risk appetite remains strong, as investors are optimistic that trade talks between the U.S. and China will yield a deal. Negotiations continued this week in Washington, but details have been hard to come by. The talks are reportedly making progress, as negotiators are preparing memorandums of understanding on key issues like cyber theft and intellectual property rights. Investors are hopeful that a March 1 deadline of higher U.S. tariffs can be avoided. The trade war between the two countries has weighed heavily on global growth, and the Canadian dollar could jump if there is a breakthrough in the talks.

The Federal Reserve minutes from the January meeting indicated that policy-makers remain dovish with regard to monetary policy. Investors were not surprised, and gold was unable to make any headway. Participants reiterated that the Fed will remain cautious, stating that a “patient approach to monetary policy” was appropriate. However, members added that if economic projections improved, the Fed could revise the “patient approach.” The minutes noted that the employment market had strengthened and economic activity was rising, but expected GDP in 2019 to slow down compared with 2018. We may not see a rate hike before the second half of the year, as the Fed has scaled back its forecast to two hikes this year, while the markets have priced in no rates hikes until 2020.

USD/CAD for Friday, February 22, 2019

USD/CAD for Feb. 21-22, 2019.

USD/CAD for Feb. 21-22, 2019.

USD/CAD, February 22 at 8:30 EST

Open: 1.3233 High: 1.3242 Low: 1.3189 Close: 1.3192

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2969 1.3049 1.3125 1.3200 1.3290 1.3383

USD/CAD posted small gains in the Asian session but has reversed directions in European trade. The pair has edged loer in Noth American trade

  • 1.3225 is providing support line
  • 1.3200 has switched to a resistance role after losses by USD/CAD on Friday
  • Current range: 1.3200 to 1.3290

Further levels in both directions:

  • Below: 1.3200, 1.3125, 1.3049 and 1.2969
  • Above: 1.3290, 1.3383 and 1.3445
  • This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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