USD/CAD Daily Forecast – Canadian Dollar Moves Higher Despite Weak Oil Markets

U.S. Dollar Is Losing Ground Against Canadian Dollar

USD/CAD is currently trying to settle below 1.2530 while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index is testing the resistance level at 95.20. If this test is successful, the U.S. Dollar Index will move towards the next resistance at 95.40 which will be bullish for USD/CAD.

Today, U.S. reported that NY Empire State Manufacturing Index increased from 19.8 in October to 30.9 in November compared to analyst consensus of 21.2.

Foreign exchange market traders also had a chance to take a look at economic reports from Canada. Manufacturing Sales declined by 3% month-over-month in September while analysts expected that they would decrease by 3.2%. Wholesale Sales grew by 1% month-over-month in September compared to analyst consensus of 1.1%.

It should be noted that WTI oil continues its attempts to settle below the psychologically important support level at $80 on worries about the spread of coronavirus in Europe. However, the weakness of oil markets failed to put additional pressure on commodity-related currencies, including Canadian dollar.

Technical Analysis

USD to CAD managed to settle below the support at 1.2550 and is trying to settle below the next support level at 1.2530. In case this attempt is successful, USD to CAD will get to another test of the next support level at 1.2500.

If USD to CAD declines below 1.2500, it will get to the test of the support at the 50 EMA at 1.2490. A move below this level will open the way to the test of the next support which is located at the 20 EMA at 1.2470. If USD to CAD manages to settle below the 20 EMA, it will head towards the next support at 1.2450.

On the upside, a move above 1.2530 will push USD to CAD towards the resistance at 1.2550. In case USD to CAD settles above this level, it will move towards the next resistance at 1.2590. A move above 1.2590 will open the way to the test of the resistance level at 1.2625.

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