Earnings Season is In Focus
Several largest American companies will publish their financial results this week. BTCUSD and XAUUSD are skyrocketing. What's going on in the markets?
USDCAD Is About to Skyrocket
Happy Thursday, dear traders! Let's check what news is moving the markets today!
- The US CPI for April was released better than the forecast. The fact was published at 4.9% vs. 5.0% in the forecast. The euro jumped because the market expects the Fed to start monetary easing soon.
- Crude oil inventories released higher than expected – at +2.951M. This became a negative factor for the oil price. XBRUSD dived to 75.75 but corrected up.
- The US Federal budget balance increased for the first time till May 2022. Money Supply M2 is slightly decreasing. The Fed is pumping out the additional liquidity from the market. The market still believes that this is temporary. According to the CME Fed watch tool, the market expects the Fed to pause next time.
- Building Permits in Canada increased by 11.3%. USDCAD is bouncing from its support level. We expect ‘loonie’ to keep rising.
- Lending to the US commercial real estate sector fell by 56% in Q1 2023 due to rising interest rates. Analysts expect commercial real estate to be the next part of the falling domino in the US, leading to a recession in the entire industry.
- Deutsche Bank stated that it has been bullish on the pound since the start of the year. However, it no longer sees it as an attractive risk/reward ratio in the short term as most of the positive news is already in the price. Moreover, the Bank of England may present a "dove surprise in its statement after raising the rate by 25 basis points today.
USDCAD outlook
USDCAD has reached the support trendline and the 1.3340 support level. We can notice that the last four candles are much smaller than the previous ones. It usually happens when smart money gains positions ahead of the trend reversals. Thus, we expect the pair to bounce off this support and skyrocket toward the 1.3510 resistance, and 1.3340 look like a great entry point for that trade.
Have a great trading session!
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