USD/CAD rally continues on strong CPI

The Canadian dollar has posted gains for a third straight day. In the North American session, the pair is trading at 1.3418, down 0.30% on the day.

Canada consumer inflation jumps in June

There was good news on the inflation front, as consumer inflation climbed 0.8% in June. This was a strong improvement from 0.3% in May and marked the sharpest one-month gain since January 2017. The core read gained 0.4% after back-to-back declines. The strong inflation data comes on the heels of excellent retail sales numbers in May – the headline figure came in at 18.7% and the core reading posted a gain of 10.6%. Is the Canadian consumer feeling comfortable opening the purse strings? It will take more than a few releases to answer that question, but this week’s consumer spending and inflation data are indicative that a recovery is underway.

USD/CAD Technical

USD/CAD posted slight gains late in the Asian session. The pair reversed directions and gave up these gains in European trade. USD/CAD has posted small losses in the North American session

  • USD/CAD has tested support at 1.3412 in the North American session. The next support level is at 1.3362
  • 1.3474 is the next line of resistance, followed by resistance at 1.3524
  • USD/CAD broke through the 10-day MA on Monday. This is a bearish signal and the pair has continued to head lower.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.