Ella 
During early trading in Asia on Tuesday, USD/CAD recovered some of its losses, but still encountered resistance at the 1.3600 mark. USD/CAD ended its two-day losing streak and is currently trading near 1.3588, with a daily increase of 0.12%.
The dollar attracted some bears amid light economic data released on Tuesday. Notably, last week’s employment data provided support for the outlook for the U.S. to remain elevated for longer. Markets have priced in a 92% chance of no action at the Fed’s September meeting and a 42.4% chance of a rate hike at the November meeting, according to the CME Group’s FedWatch tool. This could therefore boost the US dollar (USD) and limit USD/CAD upside.
U.S. Treasury Secretary Janet Yellen said on Sunday she was increasingly confident the U.S. could curb inflation without a major impact on the labor market. Yellen added that every measure of inflation is falling and there is no massive wave of layoffs.
On the other hand, Bank of Canada (BOC) Governor Steve Marklem said on Thursday that appropriate restrictive monetary policies may be adopted to restore price stability, but he reminded that the Board of Governors is concerned about the persistence of underlying inflation. to worry. Notably, the Bank of Canada decided last week to keep its key interest rate at 5%. Meanwhile, a rebound in oil prices supported gains in the Canadian dollar as Canada is the largest exporter of crude oil to the United States.
Next up, U.S. consumer price index and retail sales for August will be released on Wednesday and Thursday respectively. There will be no important Canadian economic data to be released, and US dollar fluctuations will continue to drive the USD/CAD currency pair. Traders will look for trading opportunities from this data.
Technically, USD/CAD’s daily chart is trading above the key 100 hour exponential moving average, supporting buyers for now. The first near-term barrier is at 1.3600 (psychological round number mark), with initial support at 1.3550 (August 30 low).
