USD/CAD jumps to 1.3300 neighbourhood on weaker Canadian retail sales

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  • Disappointing Canadian retail sales data provided a minor boost.
  • Positive Oil prices underpinned Loonie and capped further gains.
  • A modest pickup in the US Dollar demand remained supportive.

The USD/CAD pair built on its steady intraday up-move and jumped back closer to the 1.3300 round-figure mark in reaction to disappointing Canadian retail sales figures.
 
Data released this Friday showed that the total value of sales at the retail level in Canada recorded a growth of 0.4% in July as against 0.6% expected. Adding to this, the previous month’s figure was also revised lower to show a decline of 0.1% as compared to a flat reading reported previously.

Dismal Canadian data partly offset by bullish Oil prices

Meanwhile, core retail sales – excluding automobiles – witnessed a sharp deceleration during the reported month and came in to show a fall of 0.1%, down from the previous month’s strong growth of 0.9% and also missing consensus estimates for slower growth of 0.3%.
 
Against the backdrop of a modest pickup in the US Dollar demand, the data provided a minor lift to the major, albeit bullish Oil prices extended some support to the commodity-linked currency – Loonie and kept a lid on any strong follow-through up-move for the major.
 
Given that the pair has repeatedly failed to make it through the very important 200-day SMA barrier, it will be prudent to wait for a sustained move beyond the 1.3300 handle before positioning for any further near-term appreciating move amid empty US economic docket.

Technical levels to watch

 

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