The USDCAD pair may experience elevated volatility today around 1:30 pm GMT as several interesting data sets from both economies will be released. Market attention will mainly focus on the Fed’s preferred inflation gauge - PCE data that could guide the rates outlook as recent upbeat US data which fueled concerns that the US Federal Reserve would tighten policy further. Meanwhile personal income and spending data, will provide more details regarding the condition of US consumers ahead of the key Christmas season. Canadian traders will focus on the monthly GDP report.
From a technical point of view USDCAD pulled back during yesterday's session as buyers once again failed to break above recent highs at 1.3700. Pair retrated to key support at 1.3600, which coincides with the upward trendline and 50.0% Fibonacci retracement of the downward wave launched in mid-October 2022. Break out from this consolidation zone should lead to bigger price movements and today's macroeconomic reports could act as potential catalysts. If sellers manage to push the price below the aforementioned support, another downward impulse may be launched towards the next support at 1.3515 or even 1.3400 mark. On the other hand, should a break above the 1.3700 level occur, then upward move may accelerate towards two-year high around 1.3975 touched on October 13th.
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USDCAD, H4 interval. Source: xStation5
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