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Market Analysis

Home » Featured » USDCAD – Perfect Bounce, More Gains?

USDCAD – Perfect Bounce, More Gains?

Posted by FXTimes in Featured - February 12th, 2016 2:56 pm GMT

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Key Points

  • US Dollar after correcting lower against the Canadian Dollar found support near a major level.
  • There is a major bullish trend line formed on the hourly chart of the USDCAD pair, which is acting as a support.
  • US Retail Sales released by the US Census Bureau posted an increase of 0.2% in Jan 2016, more than the forecast of 0.1%.
  • In terms of the yearly change, the US Retail Sales rose 0.6% in Jan 2016, more than the forecast of 0.1%.

Technical Analysis

The USDCAD pair declined a few pips today, but it found support near a major bullish trend line formed on the hourly chart. The 200 hourly simple moving average was also aligned around the same trend to act as a barrier for sellers.

USDCAD

The USDCAD pair is now back above the 100 hourly simple moving average, which is a positive sign and call for more upsides in the near term.

On the upside, 1.3960 level could act as a strong barrier and may result in a downside move.

US Retail Sales

Today, the US Retails Sales, which measures the total receipts of retail stores and reflect the rate of changes of sales was released by the US Census Bureau. The forecast was lined up for an increase of 0.1% in sales in Jan 2016, compared with the previous month. However, the outcome was above the forecast, as the US Retails Sales rose 0.3%.

When we look at the yearly change, the US Retail Sales gained 0.6% in Jan 2016, which was more than the forecast of 0.1%.

Overall, the report was above the market expectation and helped the greenback to gain ground. There were gains noted in the USDCAD pair after the release and more are possible.

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