USD/CAD Daily Forecast – Canadian Dollar Retreats Against U.S. Dollar

U.S. Dollar Moves Higher Against Canadian Dollar

USD/CAD is currently trying to settle back above the resistance at 1.2550 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index settled above the resistance at 95.40 and is testing the next resistance level at 95.75. In case the U.S. Dollar Index manages to settle above this level, it will move towards the next resistance at 96 which will be bullish for USD/CAD.

Today, U.S. reported that Retail Sales increased by 1.7% month-over-month in October compared to analyst consensus which called for growth of 1.4%. On a year-over-year basis, Retail Sales grew by 16.3% while analysts expected that they would grow by 12%.

U.S. Industrial Production increased by 1.6% month-over-month in October compared to analyst consensus of 0.7% while Manufacturing Production grew by 1.2% compared to analyst consensus of 0.7%.

Stronger-than-expected reports provided additional support to the American currency and pushed it to yearly highs against a broad basket of currencies.

Foreign exchange market traders also had a chance to take a look at Producer Prices data from Canada. Producer Prices grew by 1.3% month-over-month in October while analysts expected that they would increase by 1.1%. On a year-over-year basis, Producer Prices increased by 16.7% compared to analyst consensus of 16%.

Technical Analysis

USD to CAD managed to settle above the resistance level at 1.2530 and is trying to settle above the next resistance which is located at 1.2550.

If USD to CAD gets above the resistance at 1.2550, it will move towards the next resistance level at 1.2590. A successful test of this level will push USD to CAD towards the resistance at 1.2625. In case USD to CAD manages to settle above this level, it will head towards the next resistance at 1.2650.

On the support side, the previous resistance at 1.2530 will serve as the first support level for USD to CAD. In case USD to CAD gets back below this level, it will move towards the support which is located near the 50 EMA at 1.2500. A move below the 50 EMA will push USD to CAD towards the next support near the 20 EMA at 1.2480.

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