The pair paused the 5-day rally following the release of the Canadian optimistic exports data. The pair managed to make a double top at 1.3195 on a daily closing basis.
IMPACT ON USD:
The US goods and services deficit was $43.8 billion in June, up $2.9 billion from $40.9 billion in May (revised print). The NMI registered 60.3 percent in July, which is 4.3 percentage points higher than the June reading of 56 percent. It represents continued growth in the non-manufacturing sector at a faster rate.
IMPACT ON CAD: Canada’s exports increased 6.3% in June while imports declined 0.6%. Exports volume rose 4.8%; and its price, 1.5%. For imports, its volume declined 0.9% while its price was up 0.3%. As a result, Canada’s merchandise trade deficit narrowed to $476 million in June from $3.4 billion in May.
Exports grew on higher volumes. This was the first increase following five consecutive monthly declines.
Upcoming events: Traders keep an eye on the US unemployment claims and tomorrow’s US NFP data and unemployment rate. Besides, reports on Canada’s building permits, employment change, unemployment rate, and PMI are due to be released tomorrow. We expect wild moves today and tomorrow as well.
Technical view: Monthly resistance seems to be at 1.3380. In all time frames, oscillators seem overbought. For six straight weeks the pair has been moving higher.
Intraday resistance seems to be at 1.3180, 1.3200, and 1.3220. Support is found at 1.3150, 1.3110, and 1.3080. The pair still remains with higher lows. Below the 1.3110 level, the support is at 1.3080 and 1.3060.
Review: At yesterday’s session, we open sell trade. Intraday selling available below 1.3150 aims at 1.3110. The pair exactly made low at 1.3110.
The material has been provided by InstaForex Company – www.instaforex.com