Key Points
- US Dollar managed to gains bids vs the Canadian dollar after trading as low as 1.2770.
- There was a bearish trend line formed on the hourly chart of the USDCAD pair, which was cleared during the upside move.
- In the US, the Retail Sales released by the US Census Bureau posted an increase of 1.3% in April 2016.
- The US Retail Sales ex autos gained by 0.8% in April 2016, which was more than the forecast.
Technical Analysis
The US Dollar traded down vs the Canadian dollar towards 1.2770 where it found buyers, and started to recover. There was a bearish trend line formed on the hourly chart of the USDCAD pair, which paved the way for more gains in the near term.
The pair managed to close above the 200 and 50 simple moving average on the hourly chart, but stayed below the 100 SMA.
Overall, the pair remains in an uptrend and may continue to trade higher as long as it is above the 200 SMA.
US Retail Sales
The US Retail Sales, which measures the total receipts of retail stores and the percent changes reflect the rate of changes of such sales was released by the US Census Bureau. The forecast was lined up for a rise of 0.8% in April 2016. However, the outcome was above the forecast, as the US Retail Sales increased by 1.3%.
The report mentioned that “total sales for the February 2016 through April 2016 period were up 2.8 percent (±0.5%) from the same period a year ago. The February 2016 to March 2016 percent change was revised from down 0.4 percent (±0.5%) to down 0.3 percent (±0.2%)“.
Overall, the USDCAD may continue to trade higher, but we need to keep a close eye on the 100 SMA as well on the upside.
