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The USD/CAD Shows Ambiguous Trading Dynamics

3/2/2023 11:12 AM

During the Asian session, the USD/CAD pair is growing moderately, holding at 1.3613 and recovering from yesterday's decline, which did not allow the price to consolidate on new local highs from February 24.

The US currency is supported by technical factors, while the macroeconomic statistics of the environment failed to give the “bulls” a positive impetus. Thus, the S&P Global index in the manufacturing sector in February fell from 47.8 points to 47.3 points, worse than the neutral forecasts of analysts, and the indicator of business activity in the manufacturing sector from the Institute of Supply Management (ISM) for the same period increased from 47.4 points to 47.7 points, falling short of the expected values of 48.0 points. In turn, the corresponding Canadian indicator from S&P Global increased from 51.0 points to 52.4 points, while experts expected it to decline to 50.1 points.

Moderate pressure on the Canadian dollar is exerted by statistics on the gross domestic product (GDP), released on Tuesday: in December, the value lost 0.1% after rising by 0.1% last month, although economists expected a zero trend, and the indicator for the fourth quarter of 2022 fell sharply from 2.3% to 0.0% YoY, which also was worse than forecasts of an increase of 1.5%.

On the daily chart, Bollinger Bands are rising steadily: the price range is narrowing, reflecting the emergence of ambiguous trading dynamics in the short term. The MACD indicator continues to rise, maintaining a poor buy signal (the histogram is above the signal line). Stochastic, retreating from its highs, reversed into a horizontal plane not far from the level of “80”. It is better to wait for the clarification of the signals from the indicator to open new trading positions.

Resistance levels: 1.3650, 1.3700, 1.3750, 1.3800. | Support levels: 1.3600, 1.3550, 1.3500, 1.3450.

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