USD/CAD Daily Forecast – Canadian Dollar Moves Higher As Oil Stays Strong

U.S. Dollar Is Under Pressure Against Canadian Dollar

USD/CAD is currently trying to settle below the support at 1.2550 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle below the support level at 94.20. A successful test of this level will push the U.S. Dollar Index towards the support at 94 which will be bearish for USD/CAD.

Today, U.S. reported that Initial Jobless Claims declined from 364,000 (revised from 362,000) to 326,000 while Continuing Jobless Claims decreased from 2.81 million (revised from 2.8 million) to 2.71 million.

Meanwhile, the yield of 10-year Treasuries is currently trying to settle above the resistance at 1.56%. If this attempt is successful, it will gain additional upside momentum and move towards 1.60% which will be bullish for the U.S. dollar.

Foreign exchange market traders will also continue to monitor the developments in commodity markets. WTI oil has been volatile today. It made an attempt to settle below the $75 level but lost downside momentum and moved back above the $78 level. In case WTI oil manages to settle above $78, it will head towards the recent highs near the $80 level which will be bullish for commodity-related currencies, including Canadian dollar.

Technical Analysis

USD to CAD settled below the support at 1.2590 and is testing the next support level at 1.2550. In case USD to CAD manages to settle below this level, it will move towards the next support which is located at 1.2520.

A successful test of the support at 1.2520 will push USD to CAD towards the next support at 1.2500. If USD to CAD declines below 1.2500, it will move towards the support at 1.2475.

On the upside, the previous support at 1.2590 will serve as the first resistance level for USD to CAD. If USD to CAD gets back above this level, it will head towards the resistance near the 50 EMA at 1.2625. A move above the 50 EMA will lead to the test of the resistance at the 20 EMA at 1.2645.

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