The USDCAD is experiencing a decline, influenced by stronger-than-expected Canadian manufacturing sales and a weaker US Empire manufacturing index. Currently, the pair is testing the 100-bar moving average on the 4-hour chart at 1.3814 and the 200-bar moving average at 1.38067. The session low reached 1.38144.<\/p>\n
This area is a critical zone for both buyers and sellers. Buyers aim to use this cluster for a potential rebound. Conversely, sellers are seeking a break below this cluster to push prices lower. Despite the bearish movement, the pair has struggled to move above the swing area between 1.3878 and 1.3917 from last week.<\/p>\n
The 200-bar moving average continues to serve as a noteworthy support level. This has made it a vital area to monitor in the ongoing competition between buyers and sellers. Both sides are vying for control, with the potential to influence future price directions.<\/p>\n
We are seeing the USDCAD testing a critical support zone around the 1.3810 area, which has become a key battleground. This move lower is fueled by today\u2019s stronger Canadian manufacturing sales and a weaker-than-expected US Empire manufacturing index. This aligns with a recent trend of resilient Canadian data versus softening US figures.<\/p>\n
Sellers are pointing to Canada’s August jobs report, which came in strong at +45,000, keeping the unemployment rate at a stable 5.7%. The Bank of Canada has consequently maintained a more hawkish tone, signaling that interest rates may need to stay elevated. This fundamental backdrop supports further Canadian dollar strength.<\/p>\n
On the US side, the picture is less robust, which is weighing on the pair. The last Non-Farm Payrolls report added a modest 155,000 jobs, missing expectations, and the latest CPI data showed a slight cooling of inflation to 3.4%. This is increasing market chatter that the Federal Reserve is finished with its rate-hiking cycle for now.<\/p>\n
This divergence makes the technical level around the 200-period moving average at 1.3806 immensely important for derivative traders. A firm break below this zone could see put option volume increase as traders target the 1.3700 handle. Conversely, a strong bounce would embolden bull call spread strategies, betting that this long-term support will hold once again.<\/p>\n
We have seen this 1.3800 level act as a significant floor multiple times, particularly during the volatility we observed in early 2024. In the coming weeks, a daily close below this support would be a strong bearish signal, potentially shifting the medium-term trend. The failure to break above the 1.3900 resistance last week adds weight to the view that the upside momentum is exhausted.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" USDCAD declines as Canadian data strengthens; key moving averages form critical support zone amid market tug-of-war.<\/p>\n","protected":false},"author":62,"featured_media":16964,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-30785","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/30785","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=30785"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/30785\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/16964"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=30785"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=30785"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=30785"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}