USD/CAD Exchange Rate Prediction – The Dollar Slides Despite Weak Canadian Manufacturing
The dollar eased versus the Loonie on Monday despite a broad rally against most major currencies. Softer than expected, Canadian Manufacturing data failed to derail the Loonie rally. U.S. yields rallied following a stronger than expected NY manufacturing survey. Despite robust inflation in the United States, the Canadian dollar continues to outperform.
Technical analysis
The dollar moved lower on Monday, easing back to support near the 50-day moving average, 1.2534. Resistance is seen near the 10-day moving average at 1.2469. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index is generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).
Canadian Manufacturing Declined
Canadian manufacturing sales fell 3% $58.5 billion in September, driven by a decline in motor vehicle sales. Statistics Canada reported that sales of motor vehicles fell 35.6% to $1.9 billion, the lowest level since May 2020, while sales of motor vehicle parts dropped 13.5% to $1.8 billion. Total manufacturing sales in constant dollars fell 4.2% in September, indicating a lower volume of goods sold.
This article was originally posted on FX Empire
