USD/CAD Daily Forecast – Canadian Dollar Remains Volatile
Canadian Dollar Gains Some Ground Against U.S. Dollar
USD/CAD is currently trying to settle back below the support at 1.2785 while the U.S. dollar is flat against a broad basket of currencies.
Trading is nervous today as traders wait for the results of the Fed meeting which will be released tomorrow, and the U.S. Dollar Index is stuck in the 93.10 – 93.40 range. If the U.S. Dollar Index manages to settle below 93.10, it will move towards the support at the 20 EMA at 92.80 which will be bearish for USD/CAD.
Today, foreign exchange market traders had a chance to take a look at Building Permits and Housing Starts reports from U.S. The reports indicated that Building Permits increased by 6% month-over-month in August while Housing Starts grew by 3.9%. Both reports exceeded analyst expectations.
In Canada, New Housing Price Index increased by 0.7% month-over-month in August compared to analyst consensus which called for growth of just 0.3%. On a year-over-year basis, New Housing Price Index grew by 12.2%.
USD to CAD failed to settle above the resistance at 1.2850 and declined towards the support level at 1.2785. In case USD to CAD manages to settle below this level, it will move towards the next support which is located at 1.2760.
A successful test of the support at 1.2760 will open the way to the test of the support at 1.2730. If USD to CAD declines below 1.2730, it will continue its downside move and get to the test of the next support at 1.2710.
On the upside, the nearest resistance level for USD to CAD is located at 1.2830. If USD to CAD gets above this level, it will get to another test of the resistance level at 1.2850.
A move above the resistance at 1.2850 will push USD to CAD towards the resistance at 1.2865. In case USD to CAD settles above this level, it will head towards the resistance at 1.2900.
For a look at all of today’s economic events, check out our economic calendar.