The Canadian dollar has started the week in positive territory, continuing last week’s upward trend. In the European session, USD/CAD is trading at 1.3271, down 0.27% on the day. Last week, the Canadian dollar was up 0.59%, its first winning week in a month.
US Manufacturing PMI accelerates
There was good news from the services sector on Monday. the ISM Services PMI rose to 57.8 in September, up from 56.9 beforehand. This marked expansion in services for a fourth straight month, which is an encouraging sign that the US economic recovery is gaining traction. The September reading was well into expansionary territory, above the neutral 50-level separating contraction from expansion.
This week’s market-movers
Canada releases its first event of the week on Tuesday, with the publication of Trade Balance. The country consistently shows monthly trade deficits, and the August release showed a deficit of C$2.5 billion, matching the estimate. Later in the week, the Federal Reserve releases the minutes of its last policy meeting, which will provide a look at how optimistic policymakers are about the economy. The week wraps up with key Canadian employment numbers.
- USD/CAD broke below support at 1.3278 in the Asian session. This is followed by support at 1.3251
- 1.3332 is the next resistance line. Close by, there is resistance at 1.3359
- USD/CAD is testing the 20-day MA line. If the pair breaks below this line, it would indicate a downward trend for the pair
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