- US Dollar faced a tough time this past week and traded lower against a few major currencies.
- Aussie Dollar, British Pound, Euro and the New Zealand Dollar performed well this week.
- The US Initial Jobless Claims released by the US Department of Labor recently failed to help the US dollar and registered a minor decline from 276K to 271K.
- Moreover, the US Continuing Jobless Claims posted a disappointing and below the forecast reading of 2.175M.
What’s Behind the Dollar fall?
Fundamentally, there is no major reason for the US Dollar to trade lower. However, it looks like the market has not priced well a rate hike in December 2015. Let us see how it trades moving ahead, but technically the recent move can be seen as a short-term correction.
Some of the recent economic releases in the US failed to meet the market forecast. Like, the recent US Initial Jobless Claims (reported by the US Department of Labor), evaluating the number of people filing first-time claims for state unemployment insurance posted a decline to 271K from 276K.
On the other hand, the US Continuing Jobless Claims came below the forecast of 2.175M, compared with the market expectation of 2.170M. The report published stated that “advance number for seasonally adjusted insured unemployment during the week ending November 7 was 2,175,000, a decrease of 2,000 from the previous week’s revised level. The previous week’s level was revised up 3,000 from 2,174,000 to 2,177,000”.
Overall, the US Dollar came under the bearish pressure after a few economic events. However, this may not last long as buyers might appear again.
Canadian CPI
Today, Canada will witness a monster economic release in the form of the Consumer Price Index (CPI). The report helps in calculating the price movements of the retail prices of a representative shopping basket of goods and services. The report will be published by the Statistics Canada, and the market is expecting a rise of 0.1% in October 2015, compared with September 2015. If the outcome fails to match the forecast, then the USDCAD pair may find bids and trade higher in the short term.
Technical Analysis – USDCAD
The USDCAD pair recently broke an important support area of 1.3300-20, which is now acting as a resistance for more gains.
It would be interesting to see whether buyers can manage to clear the stated resistance and take the USDCAD pair towards 1.3380-1.3400 or not.
Yours,
Vladimir
