Canadian Dollar back into recent lows as Crude Oil prices tumble on Friday.
Canadian GDP missed market expectations, economic growth came in flat.
USD/CAD etches in a new high for the week as CAD slips, US Dollar recovers.
The Canadian Dollar (CAD) saw both a new high and a new low against the US Dollar (USD) on Friday, with the USD/CAD slumping to a session low of 1.3417 before rebounding to reclaim the 1.3500 handle and mark in a new weekly high at 1.3580.
Canadian Gross Domestic Product (GDP) figures failed to meet market expectations, with the headline figure printing flat at 0.0% for the month of July versus the previous month’s 0.2% contraction. Markets were forecasting a meager 0.1% uptick in Canadian GDP.
Tightly wound Oil prices that have been bolstering the Canadian Dollar went slack in Friday trading, easing upside pressure on the CAD in tandem with an intraday rebound in the US Dollar Index (DXY).
Daily Digest Market Movers: Canadian Dollar whipsaws on Friday
Friday chart action sees the USD/CAD engulf the entire week’s trading range.
The CAD saw gains against the US Dollar through the first half of the day’s trading window.
A broad-market reversal in USD appetite, coupled with a fallback in Crude Oil spot prices sent the Canadian Dollar skidding.
The USD/CAD heads into the end of the trading week looking for 1.3550.
Crude support for the Canadian Dollar evaporated when WTI US crude barrels tumbled from $92 to sub-$90.
Oil has recovered to $90.50, but broad-market US Dollar flows have taken over chart control, keeping the USD/CAD on the high end to close out Friday.
Investors will be looking ahead to Monday’s Manufacturing Purchasing Manager Index (PMI) figures for both the Canadian Dollar and the USD.
Technical analysis: Canadian Dollar takes a tumble, USD/CAD climbs to 1.3578
The Canadian Dollar (CAD) whipsawed on Friday, claiming the trading week’s high and low in a single day as the USD/CAD roiled under shifting market sentiment.
The USD/CAD fell 70 pips, or half a percent, to 1.3420 in the first half of Friday’s trading, before rebounding to chalk in a new high for the week at 1.3580. The USD/CAD rebound was over 165 pips, or 1.25%.
Hourly candlesticks have the USD/CAD shaking out of a holding pattern wrapped around the 200-hour Simple Moving Average (SMA) near 1.3480 with the 1.3500 major handle acting as a sticking point for the pair.
Friday’s volatility sees technical indicators breaking, with the Relative Strength Index (RSI) rolling over from oversold to nearly overbought within a matter of hours.
On the daily candlesticks, the USD/CAD has recovered back to the topside of the 34-day Exponential Moving Average at the 1.3500 handle. Buyers will be looking to gain further ground towards the September peak near 1.3700, and put some distance between current prices and the 200-day SMA currently parked near 1.3450.
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