USD/CAD analysis on September 23, 2024
USD/CAD is being adjusted at 1.3558 as the Canadian dollar tries to regain ground amid conflicting economic data. In July, retail sales increased from -0.2% to 0.9%, and excluding cars, the indicator rose from 0.3% to 0.4%. However, in August, commodity prices fell sharply from 0.7% to -3.1% for the month and from 4.1% to -2.5% year—on-year, due to falling oil prices - an important export resource of Canada. Prices for manufactured goods also slowed from -0.1% to -0.8%, which may negatively affect export revenues.
The US dollar index has weakened since the beginning of the week, trading at 100.40, as the market awaits statistical data that will help determine the future prospects for economic recovery in the United States. It is predicted that in September, the index of business activity in the manufacturing sector may grow from 47.9 to 48.6 points, remaining below the key level of 50 points, and in the service sector it will adjust from 55.7 to 55.3 points, which indicates neutral dynamics.
On the daily chart, the pair is adjusted within the ascending channel with dynamic boundaries of 1.3650–1.3530.
Technical indicators indicate a strengthening of the sell signal: the EMA on the alligator indicator diverges, and the awesome oscillator histogram forms corrective bars, approaching the neutral zone.
- Short positions can be opened when the pair drops below the 1.3530 level with a target of 1.3440. We will set the stop loss at 1.3570.
- It is advisable to form long positions after fixing the price above 1.3600 with a target of 1.3690. In this case, we will place the stop loss at 1.3550.