- BOC-led pessimism continues due to the US-China trade tensions.
- The economic calendar has a few important data to offer a busy day ahead.
With the trade tension weighing over Canada’s largest export-item, crude, the USD/CAD pair is taking the rounds near 1.3515 during early Thursday.
The Bank of Canada’s (BOC) mildly downbeat rate statement helped the quote revisit January 03 high on yesterday.
Buyers stayed for long as the US-China trade saga continued derailing any optimism for commodity-linked currencies.
Worries concerning the trade tussle between the world’s two largest economies dragged crude prices despite larger than the previous drawdown conveyed by the weekly API inventory report. This offered additional weakness to the Loonie pair.
Canada’s first quarter (Q1) current account details and speech from the BOC’s Senior Deputy Governor Carolyn A. Wilkins will be next in the pipeline for the USD/CAD pair traders. The US first-quarter gross domestic product (GDP) and EIA crude oil stocks are likely additional data to gain market attention.
While current account deficit is likely widening to 18.00 billion from -15.48 billion, BOC’s Wilkins might not deviate from the central bank’s latest mildly upbeat tone. Further, the US GDP is expected to soften to 3.1% from 3.2% whereas crude stocks could deplete to -0.80 million barrels from 4.74 million barrels registered during the week ended on May 17.
Technical Analysis
Sustained trading beyond April month high near 1.3520 enables the pair to question an upward sloping trend-line stretched since early-January near 1.3565/70, a break of which may recall 1.3660/65 resistance area on the chart.
Meanwhile, 1.3490 and 1.3450 can entertain short-term sellers during the pullback ahead of questioning them with 50-day simple moving average (SMA) near 1.3415/20.
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