Current trend

The USD/CAD pair is trading around 1.3666, while the Canadian dollar remains stable amid neutral macroeconomic statistics.

In April, the manufacturing PMI fell to 49.4 points from 49.8 points, although analysts had expected an increase to 50.2 points. In March, exports adjusted to 62.56B dollars from 66.10B dollars earlier, while imports reached 64.84B dollars, also down from 65.62B dollars earlier. Thus, the trade balance deficit amounted to –2.28B dollars, which is worse than 0.48B dollars previously.

The American dollar is correcting at 105.1 points in USDX. Investors, disappointed by the unclear outlook for interest rate dynamics, react almost in no way to local macroeconomic information. Thus, initial jobless claims amounted to 208.0K, the same as a week earlier, which is better than the expected increase to 212.0K, and the total claims remained at 1.774M. The average volume of claims for four weeks decreased to 210.0K from 213.5K.

Support and resistance

On the daily chart, the trading instrument is approaching the support line of the ascending corridor with dynamic boundaries of 1.3900–1.3600.

Technical indicators are weakening the buy signal: the EMA fluctuation range on the Alligator indicator is actively narrowing, and the AO histogram is forming downward bars in the positive zone, approaching the zero level.

Support levels: 1.3630, 1.3530.

Resistance levels: 1.3700, 1.3800.

Trading tips

Short positions may be opened after the price declines and consolidates below 1.3630, with the target at 1.3530. Stop loss – 1.3700. Implementation period: 7 days or more.

Long positions may be opened after the price rises and consolidates above 1.3700, with the target at 1.3800. Stop loss – 1.3630.