Baxia Markets
November 15, 2023

USDCAD Faces Extended Losses Amidst Crude Oil Influence and Bearish Candlestick Patterns

market analysis header image

The USDCAD pair faces a potential extension of losses as improving crude oil prices contribute to the downward pressure. Recent candlestick patterns, featuring a shooting star and a bearish engulfing pattern, suggest rejection of upward movement. The market responded with a sell-off, nearing the key support level at 1.3630, with the likelihood of a break if today's US economic news outcomes are mixed or worse than forecasted. Weaker US inflation data and the concurrent rise in crude oil prices are reinforcing the downward momentum for the USDCAD pair, further supporting the Canadian Dollar (CAD).

From a technical perspective, the indicators emphasize the bearish sentiment surrounding the USDCAD pair. The 14-day Relative Strength Index (RSI) below the 50 level indicates a bearish momentum, reflecting weakened market sentiment. Similarly, the Moving Average Convergence Divergence (MACD) with a setting of 5, 34, 5 signals a bearish momentum. As the pair navigates through these economic and technical factors, the outcome of today's US economic releases, including Core Retail Sales, PPI, and Retail Sales for October, will likely play a crucial role in shaping the near-term trajectory of the USD/CAD pair. Meanwhile, Canadian Wholesale Sales are forecasted to remain stable at 0%, compared to the previous figure of 2.3%.

USD CAD Price Action

On the 4-hour chart, USDCAD is encountering challenges in sustaining its bullish momentum. While it found support at the EMA 200, the upward movement stalled just above the EMA 50. Notably, the appearance of a shooting star and a bearish engulfing candlestick pattern on November 10th and 14th triggered a significant sell-off, indicating a shift in sentiment.


Currently, the bears seem to be losing momentum as the USDCAD approaches a key support level, evident in the diminishing size of candlestick bodies. Despite the drop below the EMA 200 and the stochastic reaching oversold conditions, the RSI has not yet entered oversold territory. A slight further decline toward the key support level may push the RSI into oversold conditions.


A decisive break below this support could propel USDCAD to decline further, potentially testing 1.3600 and paving the way for a death cross on the EMA 50 & 200, signaling a strongly bearish market sentiment.

Key Economic Releases to Watch Today


Actual 4.6% vs Forecast 4.8%

USD, Core Retail Sales (MoM) (Oct)

Forecast 0.1% vs Previous 0.5%

USD, PPI (MoM) (Oct)

Forecast 0.1% vs Previous 0.5%

USD, Retail Sales (MoM) (Oct)

Forecast -0.3% vs Previous 0.7% 


CAD, Wholesale Sales


Forecast 0% vs Previous 2.3%

Open Live Account  

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. 

Nothing contained in this website should be construed as investment advice. Any reference to an investment's past or potential performance is not, and should not be construed as, a recommendation or as a guarantee of any specific outcome or profit.

Subscribe by Email