USD/CAD tests 1.4000 after Canadian CPI

By FXStreet FXStreet (Córdoba) – USD/CAD pushed a tad higher and posted fresh cycle highs following the release of disappointing Canadian inflation data, but the advance failed to gather momentum to break decisively above the 1.4000 level.

Canadian CPI fell 0.1% in November, while core inflation declined 0.3%, missing expectations of +0.1% and 0.0% respectively. From a year earlier, headline inflation rose 1.4% versus 1.5% of consensus, while core CPI grew 2.0% below the 2.3% expected.

USD/CAD climbed to a fresh 11-year high of 1.4000 as the knee-jerk reaction to data, but lacked follow through and pulled back slightly, as the pair remains overbought following the last days’ impressive rally. At time of writing, USD/CAD is trading at 1.3980, still up 0.33% on the day and on track for a weekly gain.

USD/CAD levels to watch

In terms of technical levels, on the downside short-term supports are seen at 1.3777 (Dec 17 low), 1.3716 (10-day SMA) and 1.3672 (Dec 15 low). On the upside, next resistances could be faced at 1.4003 (May 18 2004 high), 1.4086 (Aug 28 2003 high) and then 1.4100 (psychological level).
For more information, read our latest forex news. …read more

Source:: FX Street