Key Highlights

• The US Dollar faced a lot of selling pressure lately and moved below 1.3100 against the Canadian Dollar.
• There is a key bearish trend line with resistance at 1.3080 forming on the 4 hours chart of USD/CAD.
• Recently in the US, the FOMC meeting minutes were released, which failed to help USD/CAD in recovering above 1.3000 1.3050.
• Today in the US, the ADP Employment Change for June 2017 will be released, which is expected to post an increase of 185K.

USDCAD Technical Analysis

The US Dollar declined sharply during the end of June 2017 towards 1.2900 against the Canadian Dollar. The USDCAD pair remains in the bearish zone with resistances as 1.3000 and 1.3050.

Before the downside began, the pair broke a major bullish trend line at 1.3230 on the 4 hours chart. It ignited a sharp decline and the pair traded as low as 1.2912.

A correction is underway at the moment with resistance near a descending channel at 1.2995. The 23.6% Fib retracement level of the last decline from the 1.3260 high to 1.2912 low is also around the channel resistance.

There is a chance of a recovery above 1.3000, but there is a key bearish trend line with resistance at 1.3080 waiting to stop major gains.

On the downside, a break below 1.2910 might take USD/CAD towards 1.2880.

FOMC Meeting Minutes and Factory Orders

Recently, the US saw the release of the FOMC meeting minutes. There was nothing bullish, which means the USD/CAD pair failed to move above the channel resistance at 1.2990.

Furthermore, the US Factory orders for May 2017 were released by the US Census Bureau. The market was looking for a decrease of 0.5% compared with the previous month.

The actual result was disappointing, there was a decline of 0.8% in the orders in May 2017. As per the report:

New orders for manufactured goods in May, down two consecutive months, decreased $3.7 billion or 0.8 percent to $464.9 billion. Shipments, up five of the last six months, increased $0.6 billion or 0.1 percent to $471.5 billion.

However, there was no major negative impact on the US Dollar and USD/CAD after the results were announced.

Economic Releases to Watch Today

• German Factory Orders for May 2017 (MoM) – Forecast 2%, versus 2.1% previous.
• US ADP Employment Change April 2017 – Forecast 185K, versus 253K previous.
• US Trade Balance March 2017 – Forecast $ 46.2B, versus $ 47.6B previous.
• US Initial Jobless Claims – Forecast 243K, versus 244K previous.
• US ISM Non Manufacturing Index for Feb 2017 – Forecast 56.5, versus 56.9 previous.