Despite the USDCAD / Color declines in the last days of last week, the pair managed to gain for the second week in a row.
These gains were mainly due to the strength of the US dollar as a result of positive economic data that supported the greenback, where the US dollar index reached its highest level in two years.
On the other hand, the Canadian economy is suffering from some decline, and despite the high oil prices in the period mentioned, this did not give support for the Canadian currency , Which are usually a strong correlation.
There were no surprises from the Bank of Canada, keeping the interest rate at 1.75%. The interest rate statement was cautious, reinforcing the view that the Bank of Canada will freeze interest rates, which may continue until 2020.
The bank noted that lower oil prices have reduced investments and exports in the energy sector, investment and exports in other sectors have declined due to trade tensions And the slowdown in the global economy.
In the US, last week's figures were positive. Durable Goods Orders rose 2.7%, exceeding expectations of 0.7%. Core durable goods orders rose 0.4%, the highest level in 9 months.
Followed by strong GDP growth of 3.2% in the first quarter of this year, well above expectations. This was much stronger than the final GDP for the fourth quarter of last year, which reached 2.2%.
Technical Analysis:
Last week the pair managed to breach the resistance level between 1.3450-1.33465, which represents the 61.8% Fibonacci retracement level at 1.3436 for the downside wave from 1.3663 to 1.3068, and trade above the Psychological 1.35 for the first time in 2019.
Now the price has returned to test this level, which has turned into a support level.
At the time of writing this analysis the price is trading around 1.3440, which in my opinion represents a good buy opportunity with low risk, which is within 30 to 40 pips of the mentioned support level, ie within 1.34.
The first target will be 1.3520 which represents 76.4% Fibonacci, and for the long term and the swing trader, 1.3660 will be the second target.
If this scenario fails, the price will move to 50% Fibonacci at 1, 3367 then support level 1.33.
These gains were mainly due to the strength of the US dollar as a result of positive economic data that supported the greenback, where the US dollar index reached its highest level in two years.
On the other hand, the Canadian economy is suffering from some decline, and despite the high oil prices in the period mentioned, this did not give support for the Canadian currency , Which are usually a strong correlation.
There were no surprises from the Bank of Canada, keeping the interest rate at 1.75%. The interest rate statement was cautious, reinforcing the view that the Bank of Canada will freeze interest rates, which may continue until 2020.
The bank noted that lower oil prices have reduced investments and exports in the energy sector, investment and exports in other sectors have declined due to trade tensions And the slowdown in the global economy.
In the US, last week's figures were positive. Durable Goods Orders rose 2.7%, exceeding expectations of 0.7%. Core durable goods orders rose 0.4%, the highest level in 9 months.
Followed by strong GDP growth of 3.2% in the first quarter of this year, well above expectations. This was much stronger than the final GDP for the fourth quarter of last year, which reached 2.2%.
Technical Analysis:
Last week the pair managed to breach the resistance level between 1.3450-1.33465, which represents the 61.8% Fibonacci retracement level at 1.3436 for the downside wave from 1.3663 to 1.3068, and trade above the Psychological 1.35 for the first time in 2019.
Now the price has returned to test this level, which has turned into a support level.
At the time of writing this analysis the price is trading around 1.3440, which in my opinion represents a good buy opportunity with low risk, which is within 30 to 40 pips of the mentioned support level, ie within 1.34.
The first target will be 1.3520 which represents 76.4% Fibonacci, and for the long term and the swing trader, 1.3660 will be the second target.
If this scenario fails, the price will move to 50% Fibonacci at 1, 3367 then support level 1.33.