USD/CAD challenging key support

An interesting trade setup is forming

Charts (2)

On Wednesday's U.S. economic data front, the Mortgage Bankers Association's Mortgage Applications rose 2.2% for the week ending July 3rd, from -1.8% in the prior week. 

On Thursday, Initial Jobless Claims for the week ending July 4th are expected to decline to 1,375K, from 1,427K in the previous week. Continuing Claims for the week ending June 27th are expected to slide to 18,750K, from 19,290K in the week before. Finally Wholesale Inventories for the May final reading are expected to remain at -1.2% on month, in line with the May preliminary reading. 

The USD/CAD dropped 80pips to 1.3523 in Mid-day trading making it one of the largest decliners. The currency pair is attempting to break below a long term consolidation zone between 1.352 and 1.3625. A break below 1.352 low could put heavy pressure on the pair down towards 1.3485. A break back above intraday resistance at 1.356 could be enough momentum to test the upper end of the consolidation at 1.3625.



Source: GAIN Capital, TradingView

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