The Loonie is stuck in a tight range between the 50 EMA at 1.2665 and the resistance at 1.2680 while US dollar is losing ground against a broad basket of currencies.
The US Dollar Index gained strong downside momentum and is testing the support level at 95.40. The dollar’s weakness is driven by ECB comments, which were interpreted as more hawkish and pushed EUR/USD higher. In case the U.S. Dollar Index manages to settle below 95.40, it will head towards the support level at 95.20 which will be bearish for USDCAD.
Today Investors will be focused on the economic data from U.S. Initial Jobless Claims report indicated that 238,000 Americans filed for unemployment benefits in a week compared to analyst consensus of 245,000. Continuing Jobless Claims declined from 1.67 million to 1.63 million.
The final reading of Services PMI report for January indicated that Services PMI decreased from 57.6 to 51.2 compared to analyst consensus of 50.9. Factory Orders declined by 0.4% month-over-month in December while analysts expected that they would decrease by 0.2%.
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