US dollar has volatile week against Canadian dollar

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Updated: Jun 2, 2018, 06:15 UTC

The US dollar pulled bank against the Canadian dollar during most of the week but found support near the 1.28 level to turn around and form a hammer. The hammer of course is a very bullish sign, and I think if we can break above the top of the hammer, it’s likely that we will continue the upward momentum. It’s hard not to look at this and recognize that there have been three “higher lows” as of late, so that’s a good sign of course.

The US dollar fell during the course of the week but turned around of form a nice-looking hammer just below the 1.30 level. That’s obviously very bullish sign, and that it’s hard not to notice that we have formed higher lows as of late. The longer-term major uptrend line has held as support, and there are a lot of issues when it comes to Canada. Oil markets look as if they could roll over, and if they do that will only put further upward pressure in this market. Beyond that, higher interest rates in the United States should continue to drive the greenback higher.

Furthermore, there is the possibility that the geopolitical issues get worse, and that of course will favor the US dollar also. With the Federal Reserve looking to raise interest rates several times over the next year, and of course a good jobs number coming out on Friday, we should continue to see plenty of upward pressure in this market. However, if we were to break down below the 1.2750 level, the market could unwind towards 1.25 level underneath. Even if that happens, I think that the uptrend line will probably hold longer-term. I believe that this summer will continue to see upward momentum.

USD/CAD Video 04.06.18

About the Author

Christopher Lewisauthor

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.