USD/CAD Daily Forecast – Canadian Dollar Remains Under Strong PressureUSD/CAD gained strong upside momentum and is trying to settle above the resistance at 1.2700.
USD/CAD Video 26.02.21.
U.S. Dollar Gains Ground Ahead Of The Weekend
USD/CAD continues its rebound and is trying to settle above the resistance at 1.2700 while the U.S. dollar is gaining ground against a broad basket of currencies.
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The U.S. Dollar Index is currently trying to settle above the 50 EMA at 90.65. If this attempt is successful, the U.S. Dollar index will head towards the 91 level which will be bullish for USD/CAD.
Today, U.S. reported that Personal Income increased by 10% month-over-month in January after growing by 0.6% in December. Personal Spending grew by 2.4% compared to analyst consensus which called for growth of 2.5%.
Meanwhile, U.S. Treasury yields pulled back from recent highs as bond markets calmed down a bit. Interestingly, Yannis Stournaras from ECB stated that the pace of bond purchases should increase in order to put pressure on bond yields.
Foreign exchange market traders will monitor whether policymakers from other central banks will make similar calls as higher yields may become a problem for all developed economies.
USD to CAD managed to get above the resistance at the 20 EMA at 1.2665 and is trying to settle above the next resistance level which is located at 1.2700. In case this attempt is successful, USD to CAD will head towards the next resistance level at the 50 EMA at 1.2725.
A move above the 50 EMA will push USD to CAD towards the resistance at 1.2750. If USD to CAD gets above this level, it will head towards the resistance at 1.2775.
On the support side, the previous resistance at the 20 EMA at 1.2665 will serve as the first support level for USD to CAD. If USD to CAD declines below the 20 EMA, it will gain downside momentum and head towards the next support level at 1.2625.
A move below the support at 1.2625 will open the way to the test of the support at 1.2590. This support level has already been tested during the current trading session and proved its strength.
For a look at all of today’s economic events, check out our economic calendar.