FxWirePro- USDCAD Daily Outlook

Intraday bias - Neutral

USDCAD pared some of its gains despite weak Canadian retail sales. It fell 0.5% in Sep in line with estimates led by a drop in sales in a gas station. Core retail sales which exclude gasoline stations and motor vehicle and parts dealers down -0.7%, below the forecast of -0.6%.  Markets eye US Durable goods order and Fed meeting minutes for further direction. It hits an intraday low of  1.3363 and is currently trading around 1.3385.

According to the CME Fed watch tool, the probability of a 75 bpbs rate hike in Dec increased to 24.2% from 14.6% a week ago.

 The US 10-year yield declined more than 2.5% after a minor pullback to 3.84%. The US 10 and 2-year spread widened to -76.5 basis points from -57 bpbs.

Technically in the 4-Hour chart, the pair is holding above the short-term( 21- EMA), 55 EMA, and below the long-term moving average of 1.34774 (200- EMA). Any violation below 1.3370 confirms further bearishness. A dip to 1.3300/1.3230 is possible.

WTI crude oil rose more than $5 after Saudi Arabia denied a supply increase of 50000 bpd. Any break above $82.50 will push oil prices up to $85.  

The near-term resistance is around 1.3500 and any breach above targets is 1.3550/1.3600.

Indicators (4-Hour chart)

CCI (50)- Bullish

ADX- Neutral

It is good to buy on dips around 1.3360 with SL around 1.3300 for a TP of 1.3500.