USD/CAD clings to gains above 1.35 following US and Canada GDP data
- Canadian GDP expands 0.3% in October.
- The third estimate shows a 3.4% GDP growth in Q3 in the U.S.
- WTI continues to trade below $46.
The initial market reaction to the macroeconomic releases from the U.S. and Canada lifted the USD/CAD pair to a fresh 19-month high at 1.3563 but the pair quickly returned to its comfort zone. As of writing, the pair was trading at 1.3530, adding 0.15% on a daily basis.
The data published by Statistics Canada showed that the GDP expanded by 0.3% on a monthly basis in October following September's 0.1% contraction. A separate report revealed that the retail sales increased by 0.3% in the same period to come in slightly better than the analysts' estimate for a 0.2% growth.
On the other hand, according to the third estimate of the U.S. Bureau of Economic Analysis, the real GDP in the U.S. increased by 3.4% on an annual basis in the third quarter to miss the market expectation of 3.5%. Additionally, durable good orders rose 0.8% in November after declining 4.3% in October. Following the data, the US Dollar Index didn't have a difficult time holding on to its daily recovery gains and was last seen up 0.2% on the day at 96.60.
Meanwhile, another sharp fall seen in crude oil prices weighed on the commodity-sensitive loonie throughout the day. Although the barrel of West Texas Intermediate staged a modest rebound after touching its lowest level of the year at $45.10, it's still down 1% on the day at $45.75.
Technical levels to consider
The initial resistance for the pair aligns at 1.3560 (daily high/2018 high) ahead of 1.3610 (May 19, 2017, high) and 1.2670 (May 18, 2017, high). On the downside, supports are located at 1.3500/1.3490 (psychological level/daily low), 1.3445 (Dec. 20 low) and 1.3410 (Dec. 19 low).