Trading Forex and CFDs is risky
Read HotForex Daily Market Analysis

USDCAD retraces 50% of overnight’s losses

Market Analysis


The dollar remained on a back foot following Trump’s apparent hitting of the trade way button, although it remains to be seen how targeted his proposed tariffs on steel and aluminium will be. Fed policy expectations remains in the spotlight, too, with hawkish remarks from Fed member Dudley serving to offset the impact from Fed chairman Powell’s testimony before the Senate yesterday, where he chose to walk back some of the hawkish notes he struck at his House testimony earlier in the week. EURUSD logged a three-day high of 1.2287 during the Asian session earlier, extending the rebound from yesterday’s seven-week low at 1.2154. Cable also posted a new rebound high, driven by dollar softness. USDJPY fell for a third consecutive day, driven lower both by a softer dollar and by yen outperformance and after BoJ governor Kuroda reportedly said before parliament today that the central bank is looking at possible exit from stimulus measures around fiscal 2019. USDJPY posted a two-week low at 105.71, while EURJPY forayed into five-and-a-half-month low territory and AUDJPY, a cross which has been under particular pressure of late mid the risk-off sentiment in global markets, extended to a fresh nine-month low, at 82.04.

However the bigger mover despite Yen was Canadian Dollar as well.  USDCAD faced a sharp down movement by 85 pips down from the new high of the year at 1.2895. The pair has been subjected to mixed leads over the last day, with Trump’s tariffs proposals seen as negative for the Canadian dollar, although it remains to be seen if the U.S. administration will target the proposed levy on China, exempting close allies, or what impact it might have on the NAFTA renegotiation. However, the pullback was limited, since pair has already retrace 50% of it and it is currently traded at 1.2850. Hence, technically-wise the USDCAD remains strong, if we consider the rally seen in February above the 200 DAY SMA, and with 20-DAY MA crossing sharply the 50-DAY SMA. Intraday indicators confirm the bullish momentum as well, with RSI crossing above neutral and MACD remaining at the positive terittory despite overnight’s performance.

Therefore, based on the above, an intra-day Long position was taken once the pair crossed the 20-period SMA in the hourly chart at 1.2840. Targets were set at upper Bollinger Band pattern at 1.2870 and at 2-months high at 1.2895.  Support comes at 1.2820.



Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:

Andria Pichidi

Market Analyst


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.