USDCAD Price Weekly Forecast: Bullish Traders Lacking Confidence Over the 1.3700 Level. Retail Sales in Canada Have Stagnated

Key Analytical Considerations

At the moment, USDCAD is appealing since the CAD and Dollar negate one another away allowing a time of stability.

Following a positive update of the previous month’s figure, Canadian sales to retailers remain stagnant.

The decline in Canada’s inflation statistics and stagnant sales at retail suggest the Bank of Canada holding rates the following week.

Price activity in the USDCAD keeps continuing to annoy and baffle market players. Since the normally moving duo has stayed somewhat limited-range over the past two weeks. The duo has failed to push out of the 1.3570 to1.3780 range. Given the higher USD kept the bullish traders engaged. The increased price of oil appears to be aiding the Canadian dollar. Also, preventing pair from breaking above the 1.3700 mark for the time being.

BoC and Canada’s Retail Sales Figures

Sales at retailers seemed to remain stagnant in Sept, but the August data print was corrected from minus 0.3% to -0.1 percent. Considering the recent port disturbances in British Columbia. August’s retail conversion ought to be treated with a grain of sand. Due to the logistics and supply chain challenges induced by worker strikes, 12 percent of investigators observed fewer business activities.

Source: Statistics Canada

A win for the BoC, as Canadian inflation dropped in Sept amid higher gasoline costs. Both the Core and Overall rates came lower than expectations.  Which will likely assist and provide Deputy Governor Vincent’s current negative stance. The publication of inflation data and the standstill of sales at retail ought to lead the Bank of Canada to take a breather at its session the following week. Trade investors are presently factoring in an 84.1 percent likelihood of no change and a 15.9 percent possibility of a 25 basis point increase. The upcoming meeting of the Board of Governors is set for the following Wednesday,

Technical Analytics & Perspective

The USDCAD failed to break over the 1.3700 resistance level. It’s one more unsuccessful effort in a span of two weeks. With the first falling barely short of the critical 1.36920 threshold.

At the present, there appears to be an ongoing tug of battle among USD and Loonie bulls. Who are seemingly cancelling one another. The US dollar appears to have an extra appealing offer on first glance. Yet considering the present environment. The Canadian dollar has held its own as well. The CAD’s rise is mostly due to increased price of oil.  Since a decrease in inflation and stagnant sales at retail would have supported the uptrend by allowing a move over the 1.3700 barrier.

In a nutshell, the more time that there is anxiety about violence in the M. East, the stronger the USD & the higher the cost of oil. Which might lead to additional range – price swings for the duo. An upsurge in mood, on the other hand, may be exactly for CAD bullish traders to consider a move towards the 1.3500 level and possibly below.

Support & Resistance

Supporting factors:

1.3625 1.3579 1.3500

Levels of resistance:

1.3700 1.3780 1.3900