USD/CAD Daily Forecast – Canadian Dollar Moves Higher Ahead Of The Weekend

Canadian Dollar Gains Some Ground Against U.S. Dollar

USD/CAD is currently trying to settle below the support at 1.2650 while the U.S. dollar is under pressure against a broad basket of currencies.

The U.S. Dollar Index is testing the support at the 94 level. In case this test is successful, it will head towards 93.75 which will be bearish for USD/CAD.

Today, U.S. reported that Personal Income increased by 0.2% month-over-month in August while Personal Spending grew by 0.8%.

Foreign exchange market traders also had a chance to take a look at the final reading of Manufacturing PMI report which showed that Manufacturing PMI declined from 61.1 in August to 60.7 in September compared to analyst consensus of 60.5. Consumer Sentiment improved from 70.3 in August to 72.8 in September while analysts expected that it would grow to 71.

Traders will also continue to monitor the developments in commodity markets which often have a material impact on Canadian dollar. WTI oil remains volatile while traders try to guess whether OPEC+ will change its deal amid higher demand for energy and boost production by 800,000 barrels per day (bpd) in November. Currently, WTI oil is stuck in the $74 – $76 level. In case WTI oil oil settles below the $74 level on worries about higher production from OPEC+, Canadian dollar will find itself under pressure.

Technical Analysis

USD to CAD is currently testing the support level at 1.2650. In case this test is successful, it will get to the test of the next support at the 50 EMA at 1.2640.

A move below the 50 EMA at 1.2640 will push USD to CAD towards the support at 1.2625. In case USD to CAD manages to settle below this level, it will head towards the next support at 1.2590.

On the upside, the nearest resistance level for USD to CAD is located at the 20 EMA at 1.2685. If USD to CAD gets back above the 20 EMA, it will head towards the next resistance level at 1.2710. A move above this level will open the way to the test of the next resistance at 1.2730.

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