USD/CAD Starts Corrective Decrease, Gold Price Struggles
- USD/CAD started a downside correction from the 1.3080 zone.
- It traded below a major bullish trend line with support near 1.2975 on the 4-hours chart.
- Gold price is still struggling to clear the $1,850 resistance zone.
- The US Gross Domestic Product could contract 1.5% in Q1 2022.
USD/CAD Technical Analysis
The US Dollar gained pace for a move above the 1.3000 level against the Canadian Dollar. However, USD/CAD topped near 1.3080 and started a fresh decline.
Looking at the 4-hours chart, the pair started a downside correction from the 1.3078 high. There was a move below the 1.3000 and 1.2980 support levels.
The pair traded below the 38.2% Fib retracement level of the upward move from the 1.2517 swing low to 1.3078 high. Besides, it traded below a major bullish trend line with support near 1.2975 on the same chart.
The pair is now consolidating above the 1.2800 support, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours). The 50% Fib retracement level of the upward move from the 1.2517 swing low to 1.3078 high is also near 1.2800.
A downside break below the 1.2800 support could send the pair further lower. The next major support sits near the 1.2685 zone.
On the upside, USD/CAD might face resistance near the 1.2920 level. A clear move above the 1.2920 resistance zone might push the pair towards the 1.2980 level in the near term. The next major resistance might be 1.3080.
Looking at gold price, there was no upside break above the $1,850 resistance and the price is now at a risk of more losses.
- German Consumer Price Index for June 2022 (YoY) (Prelim) – Forecast +7.9%, versus +7.9% previous.
- German Consumer Price Index for June 2022 (MoM) (Prelim) – Forecast +0.3%, versus +0.9% previous.
- US Gross Domestic Product for Q1 2022 – Forecast -1.5% versus previous -1.5%.