USD/CAD comatose around mid-1.34s as volume thins out
The USD/CAD pair is spending the first trading day of the week in a very tight 25-pip range as American traders are enjoying their Memorial Day holiday. At the moment, the USD/CAD is trading at 1.3443, flat on the day.
Oil prices, which have been a major driving factor of the loonie's price action lately, fail to provide a catalyst, as the Barrel of West Texas Intermediate remains calm near the $50 handle. The pair is likely to continue moving in its narrow trading band for the remainder of the day.
- Oil: Technical indicators are mixed - BBH
- Oil: Brent likely to recover to mid-high US$50s by the end of 2017 - NAB
On Tuesday, industrial product price and raw material price indexes will be released from Canada. On the American side, traders will be focused on personal spending/income figures and PCE price index. On a monthly basis, the core PCE price index is expected to improve to 0.1% in April from -%0.1 in March. If the data from the U.S. support the view that consumers continue to help the economy keep its momentum, the US Dollar Index, which remains calm around 97.40 on Monday, could gather some bullish momentum.
- Economic calendar
Technical outlook
The RSI on the daily graph supports the idea that the pair is likely to move sideways as it remains horizontal between the 30 and 50 handles. 1.3520 (50-DMA/Fibo 50% retracement of April-May rise) could be seen as the initial hurdle ahead of 1.3600 (psychological level/20-DMA) and 1.3720 (May 14 high). On the flip side, supports are located at 1.3390 (May 25 low), 1.3340 (200-DMA) and 1.3300 (psychological level).