Technical Outlook

-AUDUSD is trading inside a bullish channel between crucial support and resistance.

-AUDUSD Last week’s intraday high and low were $0.70804 and $0.69189.

-USDCAD is trading close to the support level at $1.32318.

-USDCAD Last week’s market closed with a high of $1.34259 and a low of $1.33113.

Australia Interest Rate Decision

Reserve Bank of Australia (RBA) board members come to a consensus on where to set the rate. Traders watch interest rate changes closely as short-term interest rates are the primary factor in currency valuation.  Australia’s interest rate is set at 3.10%.

The RBA raised interest rates by 0.25% in December 2022 and warned of more rate hikes should inflation continue to rise. The impact has already been felt by consumers and are reflected in the lower retail sales over the December period.

Report is due Tuesday, 7 February at 08:30 GMT.

AUDUSD Technical Analysis:

Analysis using price action:

AUDUSD is in an uptrend on the higher time frame. RSI line is at 47.06, indicating neutral overbought and sold condition. The prices were downtrend until 13 Oct 2022, forming a bottom at $0.61699. The buyers, at this point, started entering the market and successfully breaking the previous high at $0.65337. Since then, the price has continued to form higher highs and lows and trading inside a bullish channel.

The Moving average formed a gold cross on 26 Jan 2023 by 50MA crossing the 200MA.

The market recently tried to break a crucial resistance at $0.712224 but failed and instead was pulled back. The market is now trading between both the resistance and support at $0.67131. Traders must wait for a clear breakout of either of the zone with enough confluence, keeping in mind the overall trend is an uptrend.

Canada Employment Change

Employment Change measures the change in the number of people employed. Job creation is an important indicator of consumer spending. The last employment change number was 104.0K, better than the forecast of 8.0K.

Randstad, a Canadian recruitment company, released a list of the 15 most high demand jobs in Canada. These jobs range from skilled trades to office jobs. Despite the slow growth in the economy, many fields are facing talent scarcity. Technology, health care, and professional services sectors are the top job categories with high vacancies.

Report is due Friday, 10 February at 13:30 GMT

USDCAD Technical Analysis:

Analysis using price action:

The price of USDCAD was ranging from 1st Dec 2022 till 5th Jan 2023 until the price broke the range below and started trading down. After breaking the low at $1.34816 on 6th Jan, the market went down by 217 pips cutting off 1.61% from the price.

The RSI line is at 49.41. The price is trading below the 50MA and above the 200MA, meaning in the higher time frame, the market is still bullish.

Currently, the price is trading inside a bearish channel and has recently formed a swing low at $1.32620 on 2nd Feb; at this point, the price was very close to the support level at $1.32318. It seems the bulls have entered the market and did not allow the price to breach the support. Furthermore, the market may trade up to a resistance level of $1.35272. If the price breaks any of this resistance or support with confluence, the prices may trade in the same direction.

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