- February 18, 2025
- Posted By: james w
- Category: Market News
USD/CAD Approaches Key Support Amid Economic Releases
The USD/CAD forex pair, commonly known as the “Loonie,” represents the exchange rate between the U.S. dollar (USD) and the Canadian dollar (CAD), with its nickname stemming from the image of a loon on the Canadian one-dollar coin. Today, at 3:30 PM, Canada is set to release its Consumer Price Index (CPI) data, expected to increase by 0.1% from the previous month’s -0.4%, while the Median CPI y/y is projected to rise to 2.5% from 2.4% and the Trimmed CPI y/y to 2.6% from 2.5%. These anticipated upticks suggest mounting inflationary pressures, potentially prompting the Bank of Canada to tighten monetary policy, which could strengthen the CAD. Meanwhile, the U.S. is releasing the Empire State Manufacturing Index at 3:30 PM, expected to improve to -1.9 from -12.6, and the NAHB Housing Market Index at 5:00 PM, forecasted to slightly decline to 46 from 47. These mixed indicators may lead to cautious sentiment toward the USD, and the interplay of these economic releases could result in increased volatility for the USDCAD pair today.
Chart Notes:
• Chart time-zone is UTC (+02:00)
• Candles’ time-frame is 4h.
Analyzing the USD/CAD H4 chart, the price has recently broken below the Ichimoku cloud, which has turned red, signaling a clear bearish trend and indicating that sellers are gaining control. This breakdown suggests that the cloud, now acting as resistance, could prevent upward movement and reinforce further downside pressure. Additionally, the Relative Strength Index (RSI) is approaching the oversold threshold of 30 but has not yet crossed it, implying that there is still room for further price declines before extreme selling conditions are reached. This technical setup suggests the initiation of a new bearish phase, with traders potentially eyeing short positions as the price continues to struggle beneath key resistance levels.
• DISCLAIMER: Please note that the above analysis is not an investment suggestion by “Capitalcore LLC”. This post has been published only for educational purposes.