USD/CAD Daily Forecast – Canadian Dollar Is Losing Ground At The Start Of The Week

U.S. Dollar Moves Higher Against Canadian Dollar

USD/CAD is currently trying to settle back above the resistance at 1.2800 while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle above the resistance level at 96.25. It has recently made several attempts to settle above this level and get to the test of the next resistance at 96.50, but these attempts yielded no results. In case the U.S. Dollar Index declines below 96.25, it will move towards the support at 96 which will be bearish for USD/CAD.

Today, foreign exchange market traders focused on the dynamics of commodity markets and general market sentiment. WTI oil moved lower after UK reported its first Omicron-linked death. The weakness of the oil markets put pressure on commodity-related currencies, including Canadian dollar.

It looks that demand for safe-haven assets increased ahead of the Fed Interest Rate decison, as gold, U.S. dollar and U.S. Treasuries enjoyed material support today. If traders increase purchases of safe-haven assets in the upcoming trading sessions, USD/CAD will have a good chance to develop additional upside momentum.

Technical Analysis

USD to CAD is testing the resistance level at 1.2800. In case USD to CAD manages to settle above this level, it will get to the test of the next resistance at 1.2825.

A successful test of the resistance at 1.2825 will open the way to the test of the resistance at 1.2850. In case USD to CAD moves above this level, it will head towards the resistance level which is located at 1.2890.

On the support side, the previous resistance level at 1.2780 will serve as the first support level for USD to CAD. In case USD to CAD moves back below this level, it will head towards the support at 1.2760. A move below 1.2760 will open the way to the test of the next support level at 1.2730.

For a look at all of today’s economic events, check out our economic calendar.