Canadian Dollar gives back recent gains, Canada Retail Sales disappoint

• Canadian Dollar recedes across the board on Wednesday.
• Canada Retail Sales broadly miss the mark, hurting Loonie.
• US GDP, PCE inflation to dominate the latter half of the trading week.

The Canadian Dollar (CAD) is broadly softer on Wednesday, paring back recent gains and falling back against all of its major currency peers as the single worst-performing currency for the mid-week market session. Canadian Retail Sales flubbed forecasts, declining in February and kicking the legs out from beneath the CAD. 

Canada is absent from the economic calendar for the remainder of the week, and investors will be pivoting to focus on key US data. US Gross Domestic Product (GDP) and US Personal Consumption Expenditure (PCE) Price Index inflation figures are slated for Thursday and Friday, respectively.

Daily digest market movers: Canadian Dollar pares gains as Canadian data slips

• MoM Canadian Retail Sales declined -0.1% in February, improving from the previous month's -0.3% decline but missing the forecasted 0.1% uptick.
• Retail Sales Excluding Autos also tumbled -0.3% versus the forecast of 0.0%. January's print was revised slightly lower to 0.4% from 0.5%.
• A broad-market recovery in the US Dollar is further pressuring CAD as investors rethink Tuesday's broad risk appetite rally.
• Thursday's Q1 US GDP is expected to print at 2.5% on an annualized basis, down from the previous print of 3.4%.
• Traders are hoping that Friday's US PCE Price Index holds steady at 0.3% in March.
• Financial markets desperate for signs of rate cuts from the US Federal Reserve (Fed) have grown increasingly frustrated with ongoing signs of stubborn inflation in the US economy. Friday's figures will drive plenty of volatility as markets grapple with rate cut forecasts.

Technical analysis: Canadian Dollar falls across the board, USD/CAD pulls back to key technical levels

The Canadian Dollar (CAD) has weakened against all of the other major currencies on Wednesday, shedding four-tenths of a percent against the Australian Dollar (AUD) and the USD. The CAD's least losses are against the Swiss Franc (CHF) and the Japanese Yen (JPY), falling around a fifth of a percent apiece.

The USD/CAD has risen back above the 1.3700 handle, testing chart territory north of the 200-hour Exponential Moving Average (EMA) near 1.3715. The pair bounced off the 1.3660 level to pare away Tuesday's declines.

Wednesday's pullback sends the USD/CAD into its first green trading day after five consecutive losing days. The pair is still down from the last swing high into 1.3850, and long-term technical support from the 200-day EMA rests near the 1.3500 handle at 1.3522.

USD/CAD hourly chart

USD/CAD daily chart