- Forecast for USD / CAD indicates fast de-escalation in global trade tensions.
- China agreed to reduce the US trade deficit.
- Data on Friday, painted the mixed image of the Canadian labor market.
The USD / CAD forecast indicates fast de-escalation in trade tensions between China and the USs supported by the dollar. Meanwhile, market participants are looking forward to inflation data for more than one trace on future moves FED policies.
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The US and China finally met over the weekend after weeks weekends. The two nations were at war with each mountaineering tariffs towards unsustainable levels. This trade war caused a lot of anxiety in markets, with American assets that suffers the most. Economists even predicted a global recession due to these tariffs.
However, the dollar is gathered on Monday after the report on the Agreement between China and the United States. China agreed to reduce the US trade deficit. Such a move could lead to a break in tariffs that would raise the cloud of uncertainty over both economies. However, traders are waiting for more details about the agreement.
Meanwhile, data on Friday painted a mixed image of the Canadian labor market. The economy added 7,400 jobs compared to a forecast of 4,100. However, the unemployment rate jumped from 6.7% to 6.9%, indicating a weakness.
This week, everyone focus will be on the American report on consumer and wholesale inflation. They will shape Outlook to reduce the rates on the supply values.
Today is key events USD / CAD
MARETA participants do not expect any key economic reports to the US or Canada. Therefore, they will watch American development policy.
USD / CAD technical forecast: Bulls Eye 1,4050 after piercing range
On the technical page, the USD / CAD price has fled from its consolidation surface and is now directed to a higher level. The range area is made up of 1,375 support and resilience at 1,3900. The price paused after the fall.
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However, after a long battle, the bulls finally beat, pushing the price above 1,3900 resistance. Moreover, the price pulled back to re-set the recent broken level before it climbs more. Currently USD / CAD trades well above 30ths, with RSI in the region with excessive descendants, indicating solid bias.
If this trend continues, the price will soon set the key level 1,4050. Bias will remain fluctuations until the price maintains its position above SMA and RSI above 50.
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