- US Dollar was crushed against the Canadian Dollar, and every correction in USDCAD was sold.
- There was a contracting triangle pattern formed on the hourly chart of the USDCAD pair, which was broken recently to set the pace for more losses.
- In the US, the Initial Jobless Claims released by the US Department of Labor posted an increase from the last reading of 265K to 276K.
- Canadian Gross Domestic Product released by the Statistics Canada posted a rise of 0.6% in Jan 2016, more than the forecast of 0.3%.
The US Dollar tumbled against the Canadian Dollar, and it looks like the current bearish trend is far from over. There was a contracting triangle pattern formed on the hourly chart of the USDCAD pair, which was broken recently to encourage the bears for another downside move.
The USDCAD pair may continue to trade down and even break the last swing low of 1.2911 to test the 1.2900 level.
On the upside, the 1.2960 levels can be seen as a major resistance area.
Canadian Gross Domestic Product
The Canadian Gross Domestic Product, which is a measure of the total value of all goods and services produced by Canada was released by the Statistics Canada during the NY session. The market was expecting a rise of 0.3% in the GDP in Jan 2016, compared with the previous month. However, the outcome was positive, as the Canadian GDP grew 0.6%.
The report stated that the “The output of goods-producing industries grew 1.2% in January, mainly as a result of increases in manufacturing and mining, quarrying, and oil and gas extraction. Utilities, construction, and the agriculture and forestry sector also rose”.
Overall, the Canadian dollar has all positives, and may continue to gain traction against the US Dollar.