Forex Market: USD/CAD daily trading outlook

Friday’s trade saw USD/CAD within the range of 1.3309-1.3472. The pair closed at 1.3315, falling 0.64% on a daily basis. It has been the 21st drop in the past 44 trading days, a second consecutive one and also the steepest one since March 1st, when the pair fell 0.97%. In addition, the daily low has been the lowest level since December 3rd 2015, when a low of 1.3289 was registered. In weekly terms, USD/CAD lost 1.47% of its value last week, while marking its seventh consecutive period of decline.

At 8:06 GMT today USD/CAD was edging up 0.21% for the day to trade at 1.3344. The pair touched a daily high at 1.3356 at 7:14 GMT, undershooting the range resistance level (R3), and a daily low at 1.3321 during the early phase of the Asian trading session.

Canada’s dollar continued to gain ground against its US counterpart, as crude oil futures surged to highs unseen since January 6th on Friday. March 4th marked the 29th gain in oil prices out of the past 56 trading days. Oil futures for April delivery went up as high as $36.34 per barrel on March 4th and closed at $35.92. As of 8:15 GMT today the commodity was gaining 0.61% on a daily basis to trade at $36.49 per barrel, after going up as high as $36.72 earlier. Oil has risen 8.21% so far during the current month, following a 0.39% gain in February.

On Monday USD/CAD trading may be influenced by the following macroeconomic report as listed below.

Fundamentals

United States

Change in Consumer Lending

The money amounts, borrowed by consumers in the United States probably increased by USD 16.50 billion in January, according to market expectations, following a surge by USD 21.27 billion in December, or the largest increase since September 2015. Consumer lending in December was mostly supported by non-revolving credit (auto and student loans), which rose by USD 15.43 billion. In addition, revolving credit (credit cards mostly), grew by USD 5.84 billion in December.

Given the current state of the economy, a higher-than-expected amount borrowed is usually considered as dollar positive, as it implies a potential increase in consumer spending and accelerated growth, respectively. The Board of Governors of the Federal Reserve is to release the official numbers at 20:00 GMT.

Daily and Weekly Pivot Levels

By employing the Camarilla calculation method, the daily pivot levels for USD/CAD are presented as follows:

R1 – 1.3330
R2 – 1.3345
R3 (range resistance) – 1.3360
R4 (range breakout) – 1.3405

S1 – 1.3300
S2 – 1.3285
S3 (range support) – 1.3270
S4 (range breakout) – 1.3225

By using the traditional method of calculation, the weekly pivot levels for USD/CAD are presented as follows:

Central Pivot Point – 1.3404
R1 – 1.3500
R2 – 1.3684
R3 – 1.3780

S1 – 1.3220
S2 – 1.3124
S3 – 1.2940