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USDCAD Reverts to 200-Day MA


USDCAD rose to test the 200-day moving average

the USDCAD

USD/CAD

USD/CAD is the currency pair comprising the United States dollar (symbol $, code USD) and the Canadian dollar from Canada (symbol $ code CAD). The pair’s exchange rate indicates how many Canadian dollars are needed to buy one US dollar. For example, when USD/CAD is trading at 1.3500, that means 1 US dollar equals 1.35 Canadian dollars. The US dollar (USD) is the most traded currency in the world, while the Canadian dollar (CAD) is the seventh most traded currency in the world. The United States and Canada are geographical neighbors and therefore there is a lot of trade between the two countries. Thus, there is often decent volatility and low spreads for USD/CAD, usually between 1 and 3 pips on most forex brokers. Factors Influencing USD/CAD There are a number of important economic or press releases that can affect USD/CAD. This includes, among other things, nonfarm payrolls data for the United States which is released on the first Friday of each month. These measures tell us whether employment is increasing or decreasing, while the Gross Domestic Product (GDP) of Canada or the United States measures the total value of all goods and services produced by the country. Additionally, the USD/CAD is known as a “commodity pair” because Canada has large amounts of natural resources, especially oil, which is its most traded commodity. As a result, it is important for long-term USD/CAD speculators to keep a close eye on crude oil developments due to the strong negative correlation.

USD/CAD is the currency pair comprising the United States dollar (symbol $, code USD) and the Canadian dollar from Canada (symbol $ code CAD). The pair’s exchange rate indicates how many Canadian dollars are needed to buy one US dollar. For example, when USD/CAD is trading at 1.3500, that means 1 US dollar equals 1.35 Canadian dollars. The US dollar (USD) is the most traded currency in the world, while the Canadian dollar (CAD) is the seventh most traded currency in the world. The United States and Canada are geographical neighbors and therefore there is a lot of trade between the two countries. Thus, there is often decent volatility and low spreads for USD/CAD, usually between 1 and 3 pips on most forex brokers. Factors Influencing USD/CAD There are a number of important economic or press releases that can affect USD/CAD. This includes, among other things, nonfarm payrolls data for the United States which is released on the first Friday of each month. These measures tell us whether employment is increasing or decreasing, while the Gross Domestic Product (GDP) of Canada or the United States measures the total value of all goods and services produced by the country. Additionally, the USD/CAD is known as a “commodity pair” because Canada has large amounts of natural resources, especially oil, which is its most traded commodity. As a result, it is important for long-term USD/CAD speculators to keep a close eye on crude oil developments due to the strong negative correlation.
Read this term reversed some of the declines seen yesterday and today.

As a reminder yesterday, the Bank of Canada raised rates by 50 basis points and that, combined with hopes that US inflation was peaking, drove the US dollar lower and BODY

BODY

The Canadian dollar (CAD) is the official currency of Canada and, at the time of writing, is the fifth most widely held reserve currency in the world behind the US dollar, euro, Japanese yen and British pound. . The CAD is commonly referred to as the Loonie by forex analysts and traders. As of this writing, the CAD represents 2% of all global currency reserves. Its appeal is strong among central banking authorities given Canada’s economic strength, sovereignty and historical stability. Originally introduced in 1858, the CAD has since its inception maintained a close link to the US dollar. This is due to the high degree of trade between the two countries, with the United States receiving the vast majority of Canadian exports, and Canada in turn importing more than half of its goods from its southern neighbour. For brief periods, the CAD has been pegged to the US dollar throughout its history. Currently, the Bank of Canada (BoC) is responsible for intervening to maintain the value of the currency. The value of the CAD is highly correlated to the strength of global commodity prices such as oil. As a producer and exporter of oil and other commodities, Canada benefits from rising crude oil prices. When commodity prices rise, Canada’s terms of trade also generally improve, and vice versa. Additionally, a number of domestic factors can also influence the CAD. This includes interest rates set by the Bank of Canada, national inflation rates, trade surpluses, foreign investment and direct payments.

The Canadian dollar (CAD) is the official currency of Canada and, at the time of writing, is the fifth most widely held reserve currency in the world behind the US dollar, euro, Japanese yen and British pound. . The CAD is commonly referred to as the Loonie by forex analysts and traders. As of this writing, the CAD represents 2% of all global currency reserves. Its appeal is strong among central banking authorities given Canada’s economic strength, sovereignty and historical stability. Originally introduced in 1858, the CAD has since its inception maintained a close link to the US dollar. This is due to the high degree of trade between the two countries, with the United States receiving the vast majority of Canadian exports, and Canada in turn importing more than half of its goods from its southern neighbour. For brief periods, the CAD has been pegged to the US dollar throughout its history. Currently, the Bank of Canada (BoC) is responsible for intervening to maintain the value of the currency. The value of the CAD is highly correlated to the strength of global commodity prices such as oil. As a producer and exporter of oil and other commodities, Canada benefits from rising crude oil prices. When commodity prices rise, Canada’s terms of trade also generally improve, and vice versa. Additionally, a number of domestic factors can also influence the CAD. This includes interest rates set by the Bank of Canada, national inflation rates, trade surpluses, foreign investment and direct payments.
Read this term upper.

The run down saw the pair fall below its 200-day moving average at 1.2622, its 100-hourly moving average currently at 1.26056, but found support buyers near its 200-moving average hours (green line in the graph above).

Today, price was able to crack below the 200 hourly moving average and turn for the next target at the 50% midpoint at 1.25387 of the upside from the April 5th low.

This midpoint was broken with price then falling to a daily low at 1.25203, but the last five hourly bars saw a rotation higher. Breaking back above the 50% retracement and the 200 hourly moving average (green line at 1.25628), propelling the price up to the 100 hourly moving average (blue line at 1.26056). After stalling against this level and falling back down, the USDCAD bottomed and rallied above the 100 hourly moving average towards the 200 day moving average during the last hour of trading.

Looking at the hourly chart, the current hourly bar is trading between the 100 hour moving average below and the 200 day moving average above. How this battle is resolved will likely lead to the next dynamic move.

Today’s US rate hike certainly helped turn things around for this currency pair. The US two-year yield rose to 2.466%, up 11.2 basis points. The 10-year yield is now trading at 2.803%. This represents an increase of almost 10 basis points on the day and is approaching the high of the cycle at 2.836%. The low yield today hit 2.648% before turning higher.


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