USD/CAD tests 2018 highs near 1.2900 post-GDP
- The pair clinched fresh tops just below the 1.2900 handle.
- Canadian GDP expanded 0.1% MoM in December, 1.5% YoY.
- US Consumer Sentiment gauged by the U-Mich seen at 99.5.
The Canadian Dollar depreciated further in the wake of the GDP release today, lifting USD/CAD to the boundaries of the 1.2900 handle, albeit losing some momentum afterwards.
USD/CAD higher post-data, looks to U-Mich
The pair is extending the march north this week, advancing uninterruptedly since Monday and already gaining more than 2.4% since lows in the 1.2615/10 band.
The selling pressure around CAD accelerated today after Canadian GDP figures showed the economy has expanded at a monthly 0.1% during December. Furthermore, the GDP rose 0.4% inter-quarter in Q4 and 1.7% on an annualized basis during the last three months of 2017.
In the meantime, CAD remains under pressure after President Trump recently announced the implementation of tariffs on US imports of steel and aluminium. In addition, further downside pressure is coming from the US-CA yield differentials, which continue to favour the buck for the time being.
USD/CAD significant levels
As of writing the index is gaining 0.37% at 1.2883 facing the initial hurdle at 1.2893 (2018 high Mar.2) followed by 1.2920 (high Dec.19 2017) and then 1.2927 (50% Fibo of the 2017 drop). On the other hand, a breakdown of 1.2726 (10-day sma) would open the door to 1.2685 (200-day sma) and finally 1.2614 (low Feb.26).