Canada GDP preview: What to expect of USD/CAD?

By FXStreet FXStreet (Mumbai) – The USD/CAD pair is in a sideways to pattern since Dec 17th and currently trades below the hourly 100-MA at 1.3933 ahead of the Canadian GDP, retail sales and the US personal spending data release.

Canada GDP rebound could trigger a recovery in CAD

The Canadian dollar has been heavily offered in line with the fall in the oil prices after the OPEC group lifted its output ceiling at the December 4 meeting. Consequently, the currency appears oversold (USD/CAD is overbought) on the technical charts. However, a rebound in the Canadian GDP (expected 0.3%) could help the oversold CAD take back a minor part of its losses.

Focus on US household and corporate spending

A probability of the technical correction in the CAD (due to rebound in Canada GDP and retail sales) may be wiped out of the US personal spending and durable goods orders (corporate spending) numbers print higher than estimates. On the other hand, a weaker US data and a positive Canadian data could trigger a sharp correction in the USD/CAD pair.

USD/CAD Technical Levels

At 1.3906, the immediate support is seen at 1.39, under which the pair could drop to 1.3836 (hourly 200-MA). A break below …read more

Source:: FX Street