USD/CAD Exposes To Risk of Losses, United Kingdom Inflation Hitting Harder
- After testing the 1.4000 resistance level, USD/CAD declined.
- On the 4-hours chart, a significant rising channel is developing with support close to 1.3680.
- The price of crude oil is falling and could fall below $80.
- In September 2022 (YoY), the Canadian CPI may rise 6.8%, down from 7.0%.
Technical Analysis of USD/CAD
In relation to the Canadian Dollar, the US Dollar strengthened over the 1.3500 resistance. USD/CAD, however, was unable to rise further beyond 1.4000.
The pair made a top near the 1.3977 level, according to the 4-hour chart. Below the 1.3900 mark, a negative correction began. The price of the pair dropped below the 50% Fib retracement level of the upward movement from the swing low of 1.3503 to the high of 1.3977.
The 100 simple moving average (red, 4-hours) and the 61.8% Fib retracement level of the upward movement from the 1.3503 swing low to 1.3977 high were however areas where the pair found support.
On the same chart, a significant ascending channel with support close to 1.3680 is also developing. The pair may drop near the 1.3500 support level or the 200 simple moving average if there is a downward break (green, 4-hours).
The pair is encountering resistance near the 1.3800 level on the upswing. The next significant barrier is located close to 1.3850. The pair may go toward the 1.3920 level if there is a decisive rise above the 1.3850 level. The next significant obstacle might be close to the 1.4000 level.
The price of crude oil has been steadily declining below the $85 support, and it may potentially continue to go below the $80 support.
Economic News To Trade Today
- Forecast for the UK Consumer Price Index for September 2022 is 10%, up from the prior forecast of +9.9%.
- Forecasted UK Core Consumer Price Index for September 2022 (YoY): +6.4% vs. +6.3% in the prior period.
- The Canadian Consumer Price Index for September 2022 (YoY), Forecast +6.4 against +7.0% in the previous month.
Author: Amogo Solomon
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