USD/CAD has been trading with impulsive pullbacks. The pair is currently residing below the 1.2400 support area. CAD has been quite strong amid economic reports which enabled the currency to gain impulsive momentum over USD last month. USD has been struggling to gain ground since the recent rate hike decision taken by the US Fed in December. USD has been affected by lower inflation which has dealt a blow to the US economy. As a result, USD weakened against CAD. Today, US PMI report is going to be published which is expected to decrease to 0.4% from the previous value of 0.5%, Flash Manufacturing PMI report is expected to have a slight increase to 55.2 from the previous figure of 55.1, Flash Services PMI report is also expected to increase to 54.5 from the previous figure of 53.7, Existing Home Sales report is expected to decrease to 5.72M from the previous figure of 5.81, and Crude Oil Inventories is expected to show less deficit at -1.0M from the previous figure of -6.9M. On the other hand, tomorrow Canada’s Core Retail Sales report is going to be published which is expected to increase to 0.9% from the previous value of 0.8% and Retail Sales is expected to decrease to 0.8% from the previous value of 1.5%. Though the outcome is expected to be quite mixed, any positive result in the high impact report is expected to provide more impulsive pressure for CAD in the coming days. To sum up, CAD is expected to gain more momentum against USD in the coming days unless any positive high impact economy report is released in the US.
Now let us look at the technical view. The price is residing below the 1.24 support area with an impulsive bearish pressure which is expected to lead to further bearish pressure in the coming days with a target towards 1.21. As the price remains below 1.25 price area, the bearish bias is expected to continue further.
The material has been provided by InstaForex Company – www.instaforex.com