USD/CAD Daily Forecast – Canadian Dollar Rebounds At The Start Of The Week
USD/CAD Video 01.03.21.
U.S. Dollar Is Losing Ground Against Canadian Dollar
USD/CAD is currently trying to settle below the support at 1.2665 while the U.S. dollar is gaining ground against a broad basket of currencies.
The U.S. Dollar Index is trying to get above the 91 level. If this attempt is successful, it will head towards the next resistance at 91.10 which will be bearish for USD/CAD. At the same time, it should be noted that USD/CAD has ignored dollar’s strength today as the rebound in the commodity market provided sufficient support to commodity-related currencies including Canadian dollar.
Today, the U.S. reported that Manufacturing PMI declined from 59.2 in January to 58.6 in February compared to analyst consensus of 58.5. In Canada, Manufacturing PMI increased from 54.4 to 54.8 compared to analyst forecast of 53.
Tomorrow, foreign exchange market traders will have a chance to take a look at GDP Growth Rate data from Canada. Analysts expect that GDP grew by 0.3% month-over-month in December. Fourth-quarter GDP is expected to increase by 1.5% on a quarter-over-quarter basis.
USD to CAD is currently testing the nearest support level which is located near the 20 EMA at 1.2665. If this test is successful, USD to CAD will gain additional downside momentum and head towards the next support level at 1.2625. RSI is in the moderate territory, and there is plenty of room to gain additional momentum in case the right catalysts emerge.
If USD to CAD declines below the support at 1.2625, it will move towards the next support level which is located at 1.2590.
On the upside, USD to CAD needs to stay above the 20 EMA to have a chance to develop upside momentum in the near term. The next resistance level for USD to CAD is located at 1.2700.
In case USD to CAD settles above the resistance at 1.2700, it will move towards the next resistance at 1.2725. A successful test of this level will open the way to the test of the next resistance at 1.2750.
For a look at all of today’s economic events, check out our economic calendar.