USDCAD rises as New York Empire State Manufacturing Index shows sharp improvement

USDCAD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	0.07%	9.8 Pips
Week to-date	0.09%	12.3 Pips
September	0.73%	99 Pips

Upcoming key events (London Time)

Tue 01:30 PM CAD CPI Inflation Rate (12-mth)
Tue 01:30 PM USD Monthly Retail Trade (1-mth)
Wed 07:00 PM USD Fed Interest Rate Decision (Federal Funds Rate)
Wed 07:00 PM USD Interest Rate Projections

What happened lately

The September reading of the New York Empire State Manufacturing Index in the United States showed a sharp improvement, rising to 11.5 points from -4.7 points in August, according to the New York Federal Reserve. This positive movement in the index suggests a rebound in manufacturing activity, indicating that the sector is experiencing growth. This rise signifies a healthier economic outlook and could be indicative of increasing demand, production, or both, reflecting a broader economic stabilization as manufacturers ramp up their output.

Considering the upcoming events, particularly the Canadian CPI Inflation Rate and multiple high-impact US economic indicators, including the Monthly Retail Trade and the Federal Reserve’s Interest Rate Decision and Projections, significant volatility in the USDCAD pair is anticipated. The rise in the manufacturing index is a positive signal for the U.S. Dollar, which could lead to further consolidation of the pair. If the Canadian CPI Inflation Rate comes in higher than expected, it could strengthen the Canadian Dollar, potentially offsetting gains in the USD. On the other hand, if the Federal Reserve decides to hike interest rates or projects future hikes, this could further bolster the USD against CAD. Therefore, traders should closely monitor these events for potential inflection points in the USDCAD trend.

Latest from X (Twitter)

Tweets by Statistics Canada

What can we expect from USDCAD today?

USDCAD on Monday rose 0.07% to 1.35881. Price is above 9-Day EMA while Stochastic is falling.

Updated daily direction for USDCAD looks mixed as the pair is likely to consolidate above 1.35643 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.36074 or trades above daily pivot 1.35858. Break above could target R1 at 1.36097. While to the downside, we are looking at 1.35643 (S1) and daily low of 1.35620 as support levels. USDCAD need to break on either side to indicate a short-term bias. A break above 1.36074 may suggest continuation after recent positive movement.

For the week to-date, take note that USDCAD is mixed as compared to the prior week.

Key levels to watch out:

#USDCAD Trending on Twitter

[custom-twitter-feeds hashtag=”#USDCAD” num=3 showheader=false]