USDCAD is recovering, but there is no clear signal for growth yet

22 January 2021

2 minute read

Current dynamics

Today, during the Asian session, the USD / CAD pair is actively growing, recovering from a confident decline last Wednesday, when investors reacted to Janet Yellen’s speech in the US Senate.

Moderate support for the American currency, in addition to technical factors of correction, is provided by the positive macroeconomic statistics from the US, published yesterday. In particular, traders were optimistic about the further decline in the dynamics of applications for unemployment benefits. The Canadian ADP employment report for December reflected a decrease in the number of new jobs by 28.8 thousand, which was significantly better than last month’s data, when the drop was 219.8 thousand.

On Friday, the focus of investors’ attention is the US statistics on business activity in the manufacturing and services sectors for January from Markit. In Canada, there are November data on the dynamics of retail sales.

Support and resistance levels

On the daily chart, Bollinger Bands are turning into a horizontal plane. The price range is slightly widening in response to the sharp decline in the instrument on Wednesday. The MACD indicator turned in the direction of growth, however, formally, a buy signal (the histogram should be above the signal line) has not yet formed. Stochastic maintains a confident downward trend and practically does not react to an attempt at corrective growth at the end of the week.

It is necessary to wait for the clarification of signals from technical indicators to open new trading positions in the market.